Linea Mercati Interview 1/22/25
January 23, 2025Linea Mercati Interview 1/23/25
January 24, 2025The New York Stock Exchange opened higher on Wednesday, buoyed by corporate results that generally exceeded expectations and relieved by announcements from US President Donald Trump on tariffs and artificial intelligence (AI).
Around 15:20 GMT, the Dow Jones gained 0.35%, the Nasdaq index gained 1.23% and the broader S&P 500 index advanced 0.69%.
Corporate results “were enough to revive a stock market that had been bogged down by rising rates” on bonds, Patrick O’Hare, analyst at Briefing.com, said in a note.
“The recovery continues (…) so far about fifteen key companies have published their results”, most of which have shown good performances, Peter Cardillo, analyst at Spartan Capital Securities, explained to AFP.
This analyst highlighted in particular the case of Netflix which “contributes to the mood of the market”, the streaming platform soaring on Wednesday (+12.16%) after having announced the day before slightly better-than-expected results, with nearly 19 million new subscriptions gained during the fourth quarter of 2024.
With more than 300 million subscribers, Netflix consolidates its position as a pioneer and leader in the streaming industry. Over the last three months of 2024, the company achieved $10.2 billion in quarterly revenue, up 16%, from which it generated $1.9 billion in net profit.
Another rising stock, the American giant of household and hygiene products Procter & Gamble (P&G) gained 2.24% on Wednesday, after having published results above expectations for the second quarter of its staggered financial year.
The owner of Febreze, Gilette and Pampers announced a net profit up 33% to $4.65 billion. GE Vernova, which brings together the former energy activities of the General Electric conglomerate, also advanced (+2.42%), despite a net profit below expectations in the fourth quarter of 2024.
Based on a full order book, the group reaffirmed its forecasts for 2025.
Customs duties
In addition to the results, “the fact that Trump is adopting a more measured outlook (than expected) on customs duties is also contributing to the upward movement” of the market, according to Peter Cardillo.
The new American president assured Tuesday evening that his government was discussing “10% customs duties on Chinese products”, “probably for February 1st”. This date corresponds to that announced the day before for the application of 25% customs duties on Mexican and Canadian products.
Donald Trump justifies these possible customs duties by the fact that China sends “fentanyl to Mexico and Canada”, which according to him ends up being consumed in the United States.
This synthetic drug, whose analgesic effect is 100 times more powerful than that of morphine, according to the American Drug Enforcement Agency (DEA), is at the origin of a huge health crisis in the United States.
However, these would be customs duties of a much lower magnitude than the 60% previously mentioned by Donald Trump.
On the bond market, the yield on ten-year US government bonds stood at 4.57% compared to 4.56% the previous day at the close.
Elsewhere, on the stock market, AI-related stocks benefited from Donald Trump’s announcement of the new Stargate project, which includes investments of “at least $500 billion” in AI infrastructure in the United States.
The IT services giant Oracle jumped in particular (+6.10%). Semiconductor manufacturers also welcomed this announcement positively, such as Nvidia (+3.81%), Broadcom (+0.87%) and Qualcomm (+1.85%).
