U.S. stocks rose Tuesday as investors reviewed earnings reports and a revised International Monetary Fund (IMF) forecast that the global economy would shrink sharply during the Russian invasion of Ukraine.
The S&P 500 is up 1.3%, marking its best day session in three weeks, while the Dow Jones Industrial Average exceeds 360 points. The tech-heavy Nasdaq Composite rose 1.5% after a one-month low on Monday with the S&P 500. Meanwhile, Treasury yields continued to rise, with the US 10-year benchmark reaching 2.9%, the highest since December 2018.
The International Monetary Fund (IMF) on Tuesday expected global GDP, which is a measure of economic growth, to increase 3.6% in 2022 (down from a January estimate of 4.4%) and a further 3.6% in 2023 (and decline from the last projected forecast. 3.8%).
"This crisis occurred while the global economy was in its infancy but not fully recovered from the COVID-19 epidemic," said IMF economic adviser Pierre-Olivier Gourinchas.
Quarterly results from 69 companies on the S&P 500 are in line for investors to process until Friday. Big names on the revenue docket scheduled for release this week include United Airlines (UAL), American Express (AXP) and Tesla (TSLA).
Netflix (NFLX), which is scheduled to report earnings quarterly after the market closes on Tuesday, will provide investors with information on whether subscriber growth in the streaming service has slowed post-COVID-19.
As of Monday, 53% of the 34 S&P 500 companies (comprising 10% of revenue) have so far reported the worst hit in both sales and earnings per share, a Bank of America research team has shown, slightly better than the standard. normal 1 week beating. of 47% and a quarterly value of 1% of 50%. The institution expects the EPS to hit the first quarter of 4% but anticipates a risk that could reach its target by 2022, which means that revenue will accelerate quarterly until next year.
"The pressure on capital gains from almost everything else, especially labor, building materials, and transportation, has made this quarter difficult to navigate," LPL finance strategists Jeff Buchbinder and Ryan Detrick commented on Monday. "Add spillover from the Russia-Ukraine conflict and the closure of COVID-19 in China, and key corporate lines are affected in many ways."
"Despite the difficult situation, we believe that better opportunities allow companies to beat rates as they did historically after growing revenue by two digits," added Buchbinder and Detrick. "Higher inflation translates into higher incomes so that revenue can grow at a faster rate even if it reduces a certain profit margin."
In contrast to BofA, a study from FactSet suggests that although analysts estimated their earnings in the first quarter earnings, they lowered EPS forecasts from Q1 by 0.7% from $ 52.21 to $ 51.83, forecasts EPS for the second, third and fourth quarters are more. Profits for the whole of 2022 also increased by 2.2% this year to $ 228.50 per share.
"The first thing investors take is to look at how your stock is reacting beyond the news," Heritage Capital President Paul Schatz told. "If your stock is rife with bad news, that 's a good sign that markets are volatile and volatile and have a lot of bad news."
—
11:16 a.m. ET: Investors await earnings report from Netflix after the bell
Netflix (NFLX) is set to report quarterly after market close.Investors are looking forward to further growth during the company's exit from Russia and as its significant North American market grows exponentially.
Wall Street expects Netflix to report revenue of $ 7.95 billion in the first quarter of revenue, earning per $ 2.91 per share, and a surplus of additional subscribers of $ 2.51 million.
In hindsight, 2.51 million new subscribers will represent the smallest share of Netflix's quarterly revenue from the second quarter of 2021. at the end of the last term.
Netflix has been struggling to reduce user growth over the past year, with new users slowing down after a pandemic-driven subscription. But further exacerbating the decline will be Netflix's departure from Russia in early March, which will follow the Ukraine invasion earlier this year. Cowen analyst John Blackledge estimates that Russia has about a million Netflix subscribers.
Netflix shares increased by 3% during daily trading hours to $ 347.99 per share from 11:16 a.m. ET.
—
9:33 a.m. ET: Stocks flat as investors digest earnings, downgraded IMF forecast
Here's where the main indexes were trading during Tuesday's opening bell:
—
9:08 a.m. ET: IMF says Russia-Ukraine war will cause global economy to 'slow significantly'
The International Monetary Fund (IMF) said the global economic recovery will “slow significantly” this year due to Russia's invasion of Ukraine.
The International Monetary Fund (IMF) has reduced growth in Eastern European countries but also warned that countries around the world would be affected by the effects of the war on commodity markets. The international community now expects global GDP, the rate of economic growth, to increase by 3.6% by 2022 (down from a January estimate of 4.4%) and a further 3.6% by 2023 (and decline from the last projected -3.8%).
"This crisis occurred while the global economy was in its infancy but not fully recovered from the COVID-19 epidemic," said IMF economic adviser Pierre-Olivier Gourinchas.
Russia has seen the biggest decline in the IMF report, with the country's economy now expected to shrink by 8.5% this year (compared to the 2.8% growth it predicted before the attack).
8:58 a.m. ET: Houses start to rise, building permits increase in March
U.S. housing activity was taken abruptly last month, but the start of single-family housing declined amid rising lending rates.
The Department of Trade reported that the number of new home registrations increased by 0.3% in March to an annual adjusted level of 1.793 million units last month. The February data was updated to more than 1.788 million units from the previously reported 1.769 million units. Economists had predicted that they would begin to decline to the level of 1.740 million units.
Future housing permits increased by 0.4% to an average of 1.873 million units last month.
The 30-year mortgage rate reached 5.0% during the week ending April 14, the highest since February 2011, up from 4.72% last week, with each financial institution Freddie Mac. Further increases are expected as the Federal Reserve moves forward with its fiscal consolidation plans.
7:10 a.m. ET: Stock futures near breakeven, Treasury yield grazes 2.9%
Here's how the main benchmarks fared in pre-market trading Tuesday:
—
6:13 p.m. ET Monday: Futures jump as earnings season sets into full swing
Here were the main moves in markets heading into overnight futures trading Monday:
