Yazar: Geoffrey Smith
Investing.com – GameStop (NYSE 🙂 disappointed with its quarterly report, Intel (NASDAQ 🙂 is planning new strategy and Disney is keeping bets that consumers want to return to theaters. The European and Japanese PMI data are surprisingly strong. Fed Chairman Jerome Powell will return to Congress and his three colleagues will speak elsewhere. Oil prices are soaring after a container ship gets stuck in the Suez Canal. And Elon Musk gave another leap forward.
Here’s what you need to know in financial markets on Wednesday, March 24th.
1. GameStop’s report was disappointing
GameStop, the company at the heart of 2021’s most volatile business, upset with its quarterly results. General sales declined by 3.3%, while earnings per share remained below expectations of around 8%.
However, GameStop increased 6.5% in comparable store sales in the three months leading up to January, while e-commerce sales increased by 175%. This development will support the prospects of successful renewal as an primarily online retailer.
The renewal will continue with the new management. Jenna Owens, veteran of Amazon (NASDAQ 🙂 and Google (NASDAQ :), will join the management at the end of the month as COO and Neda Pacifico, formerly on Chewy (NYSE :), will also take on e-commerce responsibility. Zulily’s Ken Suzuki will take over the supply chain.
The news was enough to change the mind of at least one bear overall. Jefferies’ (NYSE 🙂 in turn raised its price target from $ 150 to $ 175. GameStop stock fell 11% to $ 161.90.
2.Intel CEO plans new strategy
Intel has outlined plans to redefine itself as the world’s leading chip maker with a new $ 20 billion strategy plan that includes the plan to build two new fabrication facilities in Arizona.
Even though the company has pointed out that it is open to outsourcing and contract manufacturing on behalf of others, the plan is a sign that reaffirms Intel’s promise to produce its own chips.
New CEO Pat Gelsinger also said company sales will not drop as much as feared this year, after revenue and profit results exceeded domestic expectations in the first quarter. Intel shares rose 5.6% ahead of the market.
3. Stock markets will open high, eyes on Disney and Musk’s latest Bitcoin support
US stocks are preparing to open higher after falling on Tuesday. Stock markets fell due to fears that the third Covid-19 wave seen in Europe, India and South America might hinder the global economic recovery.
Up 75 points, it gained 0.3% and 0.9%.
Among the stocks that may be of interest is Tesla (NASDAQ :). CEO Elon Musk announced via Twitter that the automaker now accepts Bitcoin for payments (he didn’t say anything about the pricing policy). With this development, Bitcoin rose 5%.
Also Microsoft (NASDAQ 🙂 might get attention. It has been reported that the company is attempting to acquire Discord, the video game chat community, for $ 10 billion. Disney and AMC Entertainment (NYSE 🙂 can also see big moves. The cinema giant kept its promise that consumers wanted to return to cinemas, saying that it will release two big movies in both theaters and broadcast channels at the same time.
4. Fed talks with strong PMI numbers from Europe and Japan and US durable goods orders
Business surveys around the world showed that economic activity accelerated in March. IHS Markit’s purchasing managers index rose above expectations in both Japan and the European region, alongside the UK.
The surveys were not enough to reverse the general losses in the stock market prior to tight restrictions in Germany (federal and regional governments will reconsider on Wednesday) and early trading.
US Fed Chairman Jerome Powell and Treasury Secretary Janet Yellen will testify again before the Senate Banking Committee. A day earlier, Yellen pointed to the possibility of tax hikes to support the budget deficit. Also, February durable goods orders and weekly mortgage refinancing data will be released. Fed’s John Williams (NYSE :), Mary Daly and Charles Evans will speak.
5. Blockage in Suez Canal increases oil prices
Crude oil prices soared as a large container ship stranded on the Suez Canal and blocked one of the world’s most important trade routes. Reports show that it can take up to three days to unblock the channel.
It rose 2.9% to $ 59.43, and rose 2.8% to $ 62.50.
The US government will share weekly stock data at its usual time. While analysts are expecting a 270,000 barrel drop from the previous week, the risk of a rise cannot be ignored, following data from the American Petroleum Institute (API) showing an increase of 2.9 million on Tuesday.