New decline in Wall Street and Oil continues to rise at an 8 year high

2022-01-19T18:17:27
indices Negative dynamics Oil US stock Wall Street
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New decline in Wall Street and Oil continues to rise at an 8-year high

New decline in Wall Street and Oil continues to rise at an 8-year high: Geopolitical developments in the Middle East continue to support oil movements in the Green Zone to hit an 8-year high. 

Evest follows market developments in the following report.

Topics:

Yoshitsu is setting new records on its debut in the United States

Oil continues to rise under the geopolitical tensions in the Middle East

US stock indices decline because of higher government bond yields

Drop in Technology stocks

Negative dynamics in Asia

 

 

Yoshitsu is setting new records on its debut in the United States

Japanese retail sales of Yoshitsu cosmetics rose by 700% in its US debut on Tuesday.

The company’s American Depository Shares (ADS) opened at $40.99, 924% more than the supply price.

As a result of the session, the paper reached $32, having increased by $28 compared to the offer price.

Yoshitsu set the offer price on January 8th. The company sold 6 million ads at $ 4 per stock, the minimum range of $ 4-6. 

According to the IPO prospectus, Yoshitsu sells cosmetics in stores and online in Japan and China ,
and has franchises in the United States, Canada and the United Kingdom.

Activity in the IPO market at the beginning of the year remains slow, with only a few companies submitting their papers.

So far, Yoshitsu has shown the best result on the first trading day.

Previously, private stock firm TPG (TPG) was the top performer, up more than 15% last week from its offer price.

Oil continues to rise under the geopolitical tensions in the Middle East

Oil prices continued to rise on Wednesday, rolling to their highest level since 2014 because of the risk of supply disruptions from the Middle East.

The March futures cost for Brent crude on the London Stock Exchange ICE Futures is $88.36 per barrel,
which is $0.85 (0.97%) higher than the closing price of the previous session.

As a result of Tuesday’s trading, these futures rose by $1.03 (1.2%) – to $87.51 per barrel.

The price of West Texas Intermediate oil futures for February in electronic trading on the New York Mercantile Exchange (NYMEX) is $86.41 per barrel,
$0.98 (1.15%) higher than the final value of the previous session.

By the closing of the previous day’s trading, the value of these futures rose by $1.61 (1.9%) to $85.43 per barrel.

The previous day, the two brands had closed at their highest level since October 13, 2014, according to FactSet data.

Trading Economics wrote that prices were supported by concern about fuel shortages on the world market due to supply cuts,

and the inability of some OPEC countries to increase production to agreed levels.

In the meantime, Wednesday night’s explosion at the Kirkuk – Jehan Great Oil Pipeline linking Iraq and Turkey interrupted the pipeline’s operation, the media reported.

The cause of the explosion has not yet been determined and there are no reports of deaths.

According to Bloomberg analyst Javier Blass, more than 450,000 barrels of oil are pumped through the pipeline every day.

Earlier, it was revealed that there had been a drone attack on the territory of the United Arab Emirates, killing three people.

The Emirati authorities blamed the Yemeni Houthi rebels for the attack. Three oil tanks in Abu Dhabi were damaged by the explosion.

According to analysts: “Global oil standards are rising to levels that we have not seen ,
in almost eight years because of the outlook for declining supplies and the repercussions of tensions in the Middle East.”

 

 

US stock indices decline because of higher government bond yields 

US stock indices declined dramatically on Tuesday due to higher government bond yields, as well as lower-tech stocks.

The yield on the 10-year US Treasury rose to a two-year high of 1.866% annually, and at the two-year level to 1.038% annually,
the highest level since the end of February 2021. 

The Dow Jones Industrial Index fell by 543.34 points, or 1.51%, to 35,368.47 on Tuesday.

Among the components of the index, in addition to Goldman Sachs and Microsoft,
JPMorgan Chase & Co stock prices were at the forefront by 4.2% and Cisco Systems Inc. – by 2.7%. 

The Standard & Poor’s 500 fell by 85.74 points (1.84%) to 4577.11 points on the day.

The Nasdaq Composite Index fell by 386.86 points (2.6%) to 14506.9 points at the end of the session.

These dynamics of U.S. government bonds reflect concern that the Fed will raise interest rates faster because of rising inflation.

The inflationary threat was heightened by oil price growth, which renewed its highest level in 7 years.

The local Fed in the region said the New York Empire manufacturing index fell to 0.7 in January from 31.9 the previous month.

This surprised analysts who expected a decline of just 25 points, according to Trading Economics. 

Respondents to the Wall Street Journal predicted 25.5 points.

The index’s decline occurred for the first time since the second quarter of 2020 due to the spread of a new strain of the coronavirus, “Omicron”.

Of the Standard & Poor’s 500 sectoral sub-indices, representatives of the information technology industry and financial firms suffered the greatest losses. 

Drop in Technology stocks

US stock indices declined dramatically on Tuesday due to higher government bond yields, as well as lower-tech stocks.

In particular, the value of Twitter securities fell by 3%, and Tesla – by 1.8%.

Goldman Sachs Group cut its net profit in October and December by 13%, while the stock figure fell short of experts’ expectations.

The price of banknotes fell by 7%.

Bank of New York Mellon increased its net income for the fourth quarter by 17.1%, coinciding with average revenue and analysts’ expectations.

Revenue was better than expected. However, the bank’s stock price fell by 1.1%.

Charles Schwab Corp.’s net income rose in the fourth quarter by about 40٪, but the adjusted figure grew weaker than market expectations.

As a result, bank stock prices and brokerage fell by 3.5%.

The news that Microsoft Corp. bought the computer game developer Activision Blizzard for $68.7 billion caused the first company’s stock price,
to decline by 2.4% and the second company’s stock price to jump by 26%.

 

Negative dynamics in Asia

Stock indices in the Asia-Pacific region are also showing negative dynamics on Wednesday morning.

Japan’s Nikkei index fell by 2.36%, China’s CSI 300 by 0.58%, Australia’s S & P/ASX 200 – by 0.95%, South Korea’s Kospi – by 0.8%;
The Hong Kong Hang Seng Index alone grew by 0.02%, while U.S. S&P 500 futures lost 0.43% compared to the previous day’s closing,
indicating negative morale may continue on the US stock market on January 19.

 

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