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Indonesian minister: The United States has agreed to remove clauses related to nuclear reactor development from the trade agreement.1. All three major U.S. stock indexes closed lower. The Dow Jones Industrial Average fell 0.54% to 49,395.16 points, the S&P 500 fell 0.28% to 6,861.89 points, and the Nasdaq Composite fell 0.31% to 22,682.73 points. Boeing fell more than 2%, leading the decline in the Dow. The Wind U.S. Tech Big Seven Index fell 0.29%, with Apple falling more than 1%. The Nasdaq China Golden Dragon Index fell 0.35%, with LuKong falling more than 3% and BaWangChaJi falling more than 2%. 2. Most of the three major European stock indexes closed lower. The German DAX fell 0.93% to 25,043.57 points, the French CAC40 was flat at 8,429.03 points, and the UK FTSE 100 fell 0.55% to 10,627.04 points. 3. A report released by the U.S. Treasury Department shows that in December of last year, 14 major countries and regions reduced their holdings of U.S. Treasury bonds, with a total reduction of $88.4 billion. The total holdings of U.S. Treasury bonds by overseas "creditors" fell to $9.27 trillion. The top three overseas "creditors" of the U.S.—Japan, the UK, and China—all chose to reduce their holdings of U.S. Treasury bonds. Among them, Japans holdings of U.S. Treasury bonds decreased by $17.2 billion to $1.1855 trillion, while the UK significantly reduced its holdings by $23 billion, with its holdings falling to $866 billion. 4. The U.S. crude oil futures contract closed up 2.49% at $66.67 per barrel; the Brent crude oil futures contract rose 2.25% to $71.93 per barrel. 5. International precious metals futures generally closed higher. COMEX gold futures rose 0.12% to $5015.50 per ounce, and COMEX silver futures rose 1.09% to $78.44 per ounce.The yield on Japans 5-year government bond fell 1.0 basis point to 1.620%.Japans preliminary services PMI for February was 53.8, down from 53.7 in the previous month.Japans preliminary manufacturing PMI for February was 52.8, down from 51.5 in the previous month.

Why is HP stock down by 6% today?

Larissa Barlow

Apr 01, 2022 09:56

Tips

  • Morgan Stanley lowers its PC sales forecast and downgrades HP and Dell.

  • The pandemic's demand boost may have worn off, and PC sales may revert to their normal downward trajectory.

  • HP stock may require additional upside catalysts to return to recent highs above $40.

  • HP stock is under pressure following an analyst downgrade.


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HP shares fell after Morgan Stanley downgraded the stock owing to concerns of sluggish PC sales. Dell was also downgraded.

 

Morgan Stanley predicts that hardware budgets could be reduced, hurting HP sales. Furthermore, demand may drop as the world returns to normalcy following a two-year epidemic that boosted PC consumption.

 

The market reacted cautiously to the analyst downgrade, and HP stock fell from $40 to $36. HP stock attempted to close above yearly highs yesterday, but the downgrade definitely harmed the positive momentum.

What Is the Future of HP Stock?

Analysts estimate HP to report earnings of $4.28 per share this year and $4.43 per share the next year, thus the stock is trading at only an 8 ahead P/E ratio, which appears to be low for the current market situation.

 

However, Dell is even cheaper with a forward P/E of 7, indicating that the market does not have a strong taste for computer hardware firms.

 

Concerns about declining demand may ultimately put greater pressure on HP stock in this climate. Companies and people that updated their hardware in 2020–2021 may be hesitant to renew it, and PC sales may revert to their former downward trend.

 

This is a significant risk for HP stock, which may require other favorable catalysts to return to its recent highs. At the same time, the stock's present valuation levels may provide some support in the approaching trading sessions.

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