A cheerful start to the 2023 business year is announced on US stock exchanges on Tuesday. Support comes from Europe and China.
With gas prices falling, sentiment is positive in Europe. Gradually there are signs of economic recovery in China. Purchasing managers’ sentiment for the manufacturing sector continued to deteriorate in December, according to business magazine Caixin, but interestingly the picture painted was less pessimistic than official reports over the weekend, wrote the analyst at broker market Oanda Craig Erlam. In addition, SPI Managing Partner Stephen Innes drew attention to reports that the number of daily corona infections in China’s populous centers had peaked.
About three-quarters of an hour before the start, brokerage IG valued the Dow Jones Industrial 0.4% higher at 33,270 points. The best known Wall Street index closed 2022 with a loss of almost 9%. This was the weakest year for equity markets since the 2008 economic and financial crisis.
After a long New Year’s weekend, IG valued the tech-heavy Nasdaq 100 on Tuesday, up 0.7% to 11,013 points. Last year, the Nasdaq stock market picking index finished significantly weaker. By 2022, his score had dropped by about a third.
The papers of stock leaders Tesla and Apple could be the focus of individual stocks. Despite price cuts, the electric-car maker fell short of its 2022 sales targets. Before the market, the paper was now about 4% down, after which JPMorgan analyst Ryan Brinkman immediately lowered his price target for Tesla and reiterated his “underweight” rating. That deliveries were slightly better than he had expected is due to increased buying incentives, he wrote, and he expects lower selling prices and weakened margins. Tesla faces a significant demand problem that is likely to persist into 2023, Bernstein analyst Toni Sacconaghi added.
With a gain of 0.4%, Apple shares were in line with the market before the market. Exane BNP Paribas analyst Jerome Ramel has distanced himself from his “outperform” rating for the iPhone maker’s filings and now rates them as “neutral.” The target price is $140.
Shares in payment service provider Paypal and Gilead Sciences could also move, according to analysts. Truist Securities is now recommending Paypal as a buy, citing high cash holdings. For biotech firm Gilead, however, RBC is more cautious and has downgraded the title to “Sector Perform”. While Paypal is up 2.5% ahead of the market, Gilead is down 0.6%.
