Daily Update: Strengthening the Fold
| Tuesday's Market Insights || --- || S&P 5005,985 (+0.02%) || Nasdaq19,231 (-0.26%) || Dow43,958 (+0.11%) || Bitcoin89,297 (+1.09%) |
1. ASML Stays Optimistic
Despite a 20% plunge in two days earlier due to a downbeat prediction for the upcoming fiscal year, ASML (ASML 0.77%) executives kept a positive long-term perspective at its investors' meeting, attributing continued demand from AI-driven semiconductor products.
- "We foresee... ASML will provide substantial revenue and profitability growth": For 2030, estimates are in the range of $46-$64 billion, with CEO Christophe Fouquet emphasizing the potential to establish current technology.
- "There's hardly any company with a stronger non-geographic moat than ASML": Fool analyst Bill Mann reminded investors "Sure, the long-term trends will likely be very strong, but... remember the growth curve can be unpredictable."
2. CPI Suggests Potential Rate Cut
Markets stayed relatively stable on Wednesday, as anticipated Consumer Price Index (CPI) data for October aligned with expectations, leading traders to expect an 82.5% chance of another 0.25% rate decrease in December.
S&P 5005,985 (+0.02%)
- No substantial increase in core inflation observed: The headline CPI reports were 2.6%, slightly higher than the 2.4% the preceding month. The core index (excluding food and energy) remained constant at 3.3%.
- Eager for feedback: Fed Chair Jerome Powell is due to speak later, providing investors with his initial viewpoint on the data's significance for December's policy action. October's Producer Price Index (PPI) is also slated to be released today.
3. Banks Strike the Bond Market
Nasdaq19,231 (-0.26%)
Just released data reveals the banking sector has been actively acquiring funds through the bond markets, issuing the most bonds on a single day since 2016 during Tuesday.
- Making similar choices: Major players such as HSBC (HSBC 0.46%), Goldman Sachs (GS -1.04%), and Citigroup (C -0.59%) were crucial in contributing $23.5 billion of the $30.15 billion investment-grade issuance of the day.
- "It appears that banks are issuing bonds now to get ahead of what could occur in 2025 with interest rates": Jack McIntyre, a Brandywine Global portfolio manager, pointed out the potential for higher inflation in the U.S. in 2025 could keep interest rates elevated, increasing loan costs for banks.
Dow43,958 (+0.11%)
4. Upcoming: E-Commerce Earnings
JD.com (JD -2.15%) is scheduled to present Q3 earnings today, with projections indicating growth for both revenue and profits for the e-commerce giant.
Bitcoin89,297 (+1.09%)
- Positive development outlook: The consensus view is for revenue of $36.54 billion, reflecting a rise of more than 7% from this period last year. Earnings per share are anticipated to stand at $1.09, an 18% increase over the same period.
- Severe competition for market share:Amazon (AMZN -0.66%) broke a fresh record high the day before following news of the launch of a discount-oriented e-commerce service, titled Amazon Haul.
5. The Fun Section
Disney (DIS -1.36%) will be reporting before the market opens. If you assumed responsibility as the CEO for a day, which choice among allocating extra funds to Disney movies and streaming, or Disney Parks, Experiences and Products, would you approve and specify the reasons? Engage in discussions with family and friends, or join our community to hear the various opinions of your fellow Fools!
- Individuals interested in finance and investing might consider diversifying their portfolio by investing in ASML, given its potential for substantial revenue and profitability growth in the future.
- As banks see rising interest rates in the future, they are making moves now by bond issuances, reducing potential loan costs in the long term.
