The U.S. retail sales data in January far exceeded expectations, sending a clear signal of economic overheating, allowing the Federal Reserve (Fed) to raise interest rates to cool the economy. Major U.S. stock indexes opened lower on Wednesday (15th).
before the deadline,Dow Jones Industrial Averagefell more than 160 points or nearly 0.5%,Nasdaq Composite Indexfell more than 40 points or nearly 0.4%,S&P 500 Indexfell nearly 0.5%,Philadelphia SemiconductorThe index fell nearly 0.8 percent.
The latest US Consumer Price Index (CPI) report shows that US inflation is still showing a cooling trend, but the pace of decline has shown signs of stagnation. At the same time, several Federal Reserve (Fed) officials showed their eagle claws one following another following the inflation report, saying that they need to gradually raise interest rates to fight inflation, and hinted that price pressures brought regarding by the hot job market may push up borrowing costs than they had expected.
Williams, president of the Federal Reserve Bank of New York and vice chairman of the Federal Open Market Committee (FOMC), said a benchmark rate of between 5% and 5.5% this year appeared to be “the correct framework for the policy outlook.” Harker, president of the Federal Reserve Bank of Philadelphia, also said that inflation has not changed his view that the policy rate must rise above 5%. Interest rate futures traders are now forecasting that the policy rate will be pushed higher to a range of 5.25 to 5.5 percent in June and July.
According to data released by the U.S. Department of Commerce, U.S. retail sales rose 3% month-on-month in January, higher than market expectations of 2%. The previous value was -1.1%, the largest increase since March 2021. After deducting automobiles and gasoline, core retail sales in January reported a monthly growth rate of 2.3%, far exceeding market expectations of 0.8%, the largest increase in nearly two years, and the pre-revised value was -0.9%. None of the relevant retail sales data has been adjusted for inflation.
In terms of individual stocks, Airbnb (ABNB-US) pre-market shares rose more than 8%, rising above $130 per share, mainly because the company’s revenue in the last quarter exceeded Wall Street analysts’ expectations, and the good news also drove other travel stocks higher.
Elsewhere, U.K. inflation fell more than expected in January,GBPgo soft.
In terms of energy, the February monthly report of the Organization of the Petroleum Exporting Countries (OPEC) predicted that the growth rate of global oil demand this year will be 2.3 million barrels per day, slightly higher than the previous forecast of 2.22 million barrels per day.At the same time, the organization also raised its forecast for global economic growth this year from 2.5% to 2.6%,EURThe regional economic growth forecast was revised up to 0.8% from 0.4%.
The International Energy Agency (IEA) also raised its global oil forecast on Wednesday as China reopened following years of lockdowns to fight the coronavirus. Before the deadline, international oil prices fell more than 0.7%.
As of 22:00 on Wednesday (15th) Taipei time:
Focus stocks:
Tesla (TSLA-US) rose 0.8 percent to $210.93 a share in early trade
US electric car leader Tesla closed up 7.51% on Tuesday, and its stock price returned to $200 per share, with a market value soaring by nearly $50 billion. The stock continued to move higher in premarket Wednesday, up more than 2 percent at $214 a share. In addition, by the end of next year Tesla will open 3,500 new and existing superchargers along highways to “non-Tesla users” and 4,000 slow chargers in places such as restaurants and guessing tubes. Analysts said the move might turn Tesla into a general-purpose gas station in the electric car era, but it might also erode Tesla’s competitive advantage.
Meta Platforms(META-US) fell 1.57% in early trade to $176.66 per share
Tom Alison, vice president of Meta, the parent company of Facebook, said that this year plans to focus resources on artificial intelligence (AI), and will give priority to the development of AI recommendation engine (AI Discovery Engine), which recommends platform content through information such as user registration accounts. In addition, this month, Facebook’s daily active users exceeded 2 billion for the first time, and monthly active users approached 3 billion.
Roblox(RBLX-US) soared 18.70% in early trading to $42.34 per share
Metaverse concept stock Roblox soared 16% before the U.S. stock market on Wednesday. According to its latest financial report, Roblox’s annual revenue increased by 16% to US$2.2 billion last year, and its annual bookings increased by 5% to US$2.9 billion; last quarter’s net loss was US$290 million, which was lower than the market’s expected loss of US$303 million US dollars, adjusted EBITDA reported 183 million US dollars, a loss of 0.48 US dollars per share, far below market expectations of 0.51 US dollars. In addition, daily active users reported 58.8 million in the last quarter, lower than market expectations of 59.3 million.
Today’s key economic data:
- U.S. retail sales rose 6.38% in January, up from 5.89% previously
- U.S. retail sales rose 3.0% in January, expected to be 1.8%, and the previous value was -1.1%
- U.S. industrial production grew at an annual rate of 0.79% in January, up from 1.15% previously
- The monthly growth rate of industrial production in the United States in January was reported at 0%, expected to be 0.5%, and the previous value was -1.0%
- The US February NAHB housing market index is expected to be 37, the previous value is 35
Wall Street Analysis:
Jim Bianco, founder of Bianco Research, said that the biggest concern facing US stocks in the future is that the Fed believes that the tightening policy is not enough. The assumption behind all the US recession forecasts earlier this year was that the Fed had raised rates aggressively and hurt the economy, but that may not be the case, and maybe all the Fed did was move rates toward neutral, and that’s what the market is starting to pick up on.
John Paulson, founder of the hedge fund Paulson & Co., said,goldwill appreciate and the dollar will depreciate. That’s his outlook for this year, and the next three and five years. In addition, he also said that the Fed may raise interest rates by another 2 to 4 yards before pausing rate hikes.
