Thursday, January 30, 2020

Tesla's stock spikes in after-hours trading; concerns about coronavirus outbreak rises

Tags
  • China
  • Dollar
  • Yen
  • Stocks
  • US earnings' season
  • Federal Reserve

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Market Recap: Tesla's stock spikes in after-hours trading; concerns about coronavirus outbreak rises

US stocks remained relatively flat on Wednesday as upbeat earnings reports balanced out concerns about the coronavirus outbreak in China. Apple's shares added 2.09% to end Wednesday's trading session US$324.34 per share. The death toll from the coronavirus outbreak reached 170 on Thursday morning and the number of confirmed cases swelled to more than 7,800.

Tesla beat analysts’ estimates in both sales and profits to post its second quarterly profit in a row thanks to record vehicle deliveries. Coupled with a 500,000-delivery forecast for the year, its shares surged after-hours to as high as US$654 per share, or a 13% gain. Microsoft also reported better-than-expected quarterly sales and profit thanks to a faster pace of growth in revenue from its Azure cloud computing segment. Microsoft shares rose as much as 4.58% to US$175.74 per share in after-hours trading.

Indexes Change (%) Net Change Closing Price
Dow Jones 0.04% 11.60 28,734.45
S&P500 -0.09% -2.84 3,273.40
Nasdaq 0.06% 5.48 9,275.16
*Source: Bloomberg

The dollar index inched only slightly lower on Wednesday as there were little surprises from the Fed's first monetary policy meeting for 2020. As expected, the Fed left interest rates unchanged and raised its IOER by 5bps to 1.60%. The central bank also downgraded household spending to moderate from strong. Fed Chair Jerome Powell said that he is not comfortable with inflation staying persistently below the 2% target, which likely helped put some pressure on the greenback.

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Meanwhile safe haven assets rebounded on Wednesday after suffering losses on Tuesday. Gold, yen and US treasuries all gained across the board. Benchmark 10-year yields declined 7bps to 1.58%.

Safe Haven Assets Change (%) Net Change Closing Price
Gold 0.62% 9.66 1,576.83
Silver 0.50% 0.09 17.35
JPY 0.12% 0.13 109.02
*Source: Bloomberg
US Treasury yields Change (bps) Yield (%)
2-Year -5 1.41%
10-Year -7 1.58%
30-Year -7 2.04%
*Source: Bloomberg

Crude oil prices were mixed on Wednesday. Investors were optimistic that OPEC would extend crude oil output cuts to provide support amid the coronavirus outbreak, although a rise in US crude inventory dampened optimism for crude oil prices. Brent crude futures gained 30cents to close Wednesday's trading session at US$59.81 per barrel while WTI crude futures lost 0.28% or 15cents to end the day at US$53.33 per barrel.

Oil Futures Change (%) Net Change Closing Price
Brent Crude 0.50% 0.30 59.81
WTI Crude -0.28% -0.15 53.33
*Source: Bloomberg

In Asia, stocks look set to fall on Thursday after the WHO called a meeting of its Emergency Committee to consider issuing a global alarm as the deaths and confirmed cases from the coronavirus outbreak continues to rise. The Nikkei and KOSPI both started Thursday 0.41% and 0.71% lower.

Asia Change (%) Net Change Last Price As of (GMT +8)
Nikkei Index -0.41% -94.71 23,275.19 8:14:50 AM
KOSPI Index -0.64% -14.09 2,173.20 8:34:50 AM
ASX200 Index -0.25% -17.92 7,014.50 8:34:35 AM
*Source: Bloomberg

Electronic Arts (6am), Visa (6am), Western Digital (6am) and Amazon (6.30am) are set to report their quarterly earnings tomorrow (January 31st) morning (all timings in GMT +8).

Economic releases for the day include (all timings in GMT +8):

  • Germany Jan Unemployment Rate/Change (4.55pm)
  • Eurozone Dec Unemployment Rate (6pm)
  • BoE Decision on Monetary Policy (8pm)
  • BoE Monetary Policy Press Conference (8.30pm)
  • Germany Jan Inflation Rate (CPI) (9pm)
  • US 2019Q4 Inflation Rate (PCE) (9.30pm)
  • US 2019Q4 GDP (9.30pm)
  • US Jan 23 Initial Jobless Claims (9.30pm)