Quotes at 18:10 Moscow time
S&P 500 Index: 4290 (-2,5%)
Nasdaq Composite Index: 13,366 (-3%)
External background: German DAX -3.4%; Japanese Nikkei +0.2%; Chinese Shanghai Composite +0.05%.
US stock indexes are falling at the opening of trading on Monday. The focus is on the reporting season and upcoming events of the week. The key factor in the fall is the Fed meeting, which will be held on Tuesday-Wednesday.
On Friday, the S&P 500 fell 1.9% due to fears of tightening the Fed’s monetary policy. In the area of 4300-4250 on the S & P 500 there is a support zone. Resistance in the case of a new entry up is 4500-4550 p.
Corporate messages
Shares of Netflix fall 6% after Friday’s 22% dip. The reason is poor reporting. The number of new subscribers decreased by 8.28 million compared to 8.5 million in the fourth quarter a year earlier. The total number of paid subscribers is 222 million. The second negative factor is the forecast for new subscribers for the current quarter.
On Monday, after the close of trading in the US, quarterly reports will be made by IBM. In addition, from the reporting this week it is worth paying attention to General Electric, Microsoft, Tesla, Apple, Intel. According to FactSet, in the fourth quarter, the composite EPS of the S&P 500 index could rise by 21.4% (y/y). 76% of companies presented a positive surprise on earnings per share and 90% on revenue
On the week
On Wednesday, the results of the Fed meeting will be published. We are waiting for a decision on the asset buyback program, comments on the economy, Jerome Powell’s speech. The focus is on market forecasts for the key rate, the dynamics of the yield of US government bonds and the dollar.
The yield of 10-year Treasuries tested the 1.9% mark and rolled back to the support level of 1.7%, the probability of a new entry of 2% is high.
From macro statistics, it is worth paying attention to orders for durable goods, retail sales, personal income and expenses of Americans. On Thursday, the first estimate of US GDP for the fourth quarter will be presented, the consensus forecast of economists suggests a 5.4% indicator (q/q).
BCS World of Investments