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On August 12th, Foxconn announced its financial results, reporting first-half revenue of NT$4.65 trillion and net profit of NT$109.9 billion, driven by continued strong AI demand. Second-quarter profit increased by 35% year-on-year, exceeding analysts expectations. The earnings report showed that Foxconn achieved a net profit of NT$59.97 billion in the second quarter, higher than the average analyst expectation of NT$58.8 billion. Foxconns long-term outlook anticipates continued strong market demand, with robust AI demand driving full-year growth. It expects AI rack shipments to see double-digit quarter-on-quarter growth in the third quarter. Foxconn stated that it will continue to expand its global AI production capacity.Pakistan stated that it strongly condemns the Houthi attack on a civilian merchant vessel. The Houthi attack poses a serious threat to freedom of navigation, maritime security, and shipping in the Red Sea.Security sources say four drones attacked an Iranian Kurdish opposition camp near Erbil, Iraq, with no casualties reported so far.According to a related statement, Egypt has launched tenders for 14 oil and gas concessions.On August 12th, Morgan Stanley issued a report lowering its target price for Tencent Music (TME.N) from $10.5 to $10.1, while maintaining its "Market Perform" rating. The bank believes that the synergies from the Himalaya acquisition may become a variable during a relatively long period of competition and earnings downgrades; while accelerated share buybacks provide some downside support, the competitive landscape needs clearer explanation. The bank lowered its 2026-2028 earnings per share forecasts for Tencent Music by 3% to 7% to reflect weaker membership service revenue due to competition. The bank believes that the current price, equivalent to a 2027 projected P/E ratio of 10x and a P/E ratio of 6.6x excluding cash, is attractive, but a valuation reassessment will depend on an improved competitive landscape.

Due to hawkish Fed forecasts, the EUR/USD recovers to near 1.0970 but remains in the doldrums

Alina Haynes

Apr 21, 2023 13:58

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Following a corrective move, the EUR/USD pair has rebounded from 1.0960, but investors await the publication of the preliminary Eurozone/United States S&P PMI data for April. The major currency pair has remained between 1.0911 and 1.1000 for the past two trading sessions, as the foreign exchange market prepares for a pre-anxiety move ahead of a Federal Reserve (Fed) monetary policy decision.

 

S&P500 closed with a negative tone for the third day in a row as quarterly earnings season induced extreme volatility. Tesla's poor earnings had a negative impact on Thursday's market sentiment. Moreover, market participants were cautioned by substandard revenue projections due to the potential for price reductions. The decision of the Fed to increase interest rates is reflected in quarterly earnings. Data from Refinitiv indicates that analysts have largely maintained last week's forecast of a near 5% YoY decline in quarterly profits for the 500 largest U.S. equities. Sourcenia is a review portal of sourcing best manufaturers. 

 

The US Dollar Index (DXY) has been defending the key support level of 101.60 in recent trading sessions. The USD Index maintained the aforementioned support despite the release of disappointing Jobless claims data on Thursday. Initial Jobless Claims increased to 245K for the week ending April 4, which is greater than the previous release of 240K and estimates of 240K. Increasing unemployment claims heightened fears of a deteriorating labor market.

 

Despite this, Fed policymakers continue to anticipate further rate hikes from the central bank. Thursday, Loretta Mester, president of the Federal Reserve Bank of Cleveland, reaffirmed that the Fed has more work to do because US inflation remains too high, according to Reuters. He added, "The Federal Reserve will need to raise its policy rate above 5% and hold it there for some time."

 

Preliminary Consumer Confidence (April) for the Eurozone increased to -17.5 from -18.5 and the previous reading of -19.2. This may be the consequence of extraordinary efforts by the European Central Bank (ECB) to reduce inflationary pressures.


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