The Federal Reserve keeps the interest rate unchanged and Asian markets are in the Red Zone

2022-01-27T17:55:45
Asia Intel Negative trading Oil Tesla US indices
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The Federal Reserve keeps the interest rate unchanged and Asian markets are in the Red Zone

The Federal Reserve keeps the interest rate unchanged and Asian markets are in the Red Zone: US companies continue to announce financial results for the fourth quarter of 2021, which investors focus on with the results of the federal meeting. 

Evest follows market developments in the following report.

Topics:

Negative trading in Asia and US indices without a clear trend

Samsung hits record revenue in the fourth quarter of 2021

Oil falls while Brent is close to $90 per barrel

Intel results better than expected

Tesla’s record net profit in 2021

 

 

Negative trading in Asia and US indices without a clear trend

On Thursday morning, stock indices for Asia Pacific countries show a negative trend, with Japan’s Nikkei 225 falling by 2.85%, and China’s CSI300 by 0.99%. 

US stock indices ended their trading on Wednesday without any dynamics after summing up the results of the first meeting of the US Federal Reserve Board this year. 

The Federal Reserve kept the interest rate on federal funds at 0% to 0.25% annually.

The decision coincided with the predictions of economists and market participants.

The Fed also said it plans to further reduce the asset buyback program and plans to terminate it in March.

Given that inflation is significantly higher than 2% per annum with a strong labor market,
members of the Commission expect that “it will soon be appropriate to raise the rate target range.” 

Following the meeting that ended on Wednesday, Fed Chairman Jerome Powell said that the Fed’s policy tendency is not fully ascertained so far.

Meanwhile, he indicated very significant support for the Fed’s actions on its course to raise interest rates.

He also noted that the economy no longer needed strong Federal Reserve support.

Members of the Federal Open Market Commission (FOMC) plan to raise interest rates at the March meeting.

Samsung hits record revenue in the fourth quarter of 2021

South Korean electronics manufacturer, Samsung, posted record revenue in the fourth quarter of 2021,
with operating profits more than 1.5 times higher due to increased demand for memory chips.

The company’s operating profit from October to December 2021 increased by 53% on an annual basis to 13.9 trillion South Korean won ($11.6 billion).

The result was the highest since 2017.

Samsung revenue in the said quarter was 76.6 trillion won ($63.97 million) and became a record for the company.

The company attributed the revenue rise to increased sales of smartphones, televisions and other consumer electronics.

The company’s semiconductor business recorded revenues of 26.01 trillion won and an operating profit of 8.85 trillion won.

The supply business recorded quarterly revenue of 9.06 trillion won and operating income of 1.32 trillion won.

The mobile information and communications technology division generated revenue of 28.95 trillion won and an operating income of 2.66 trillion won.

The consumer electronics division, including the television sector, recorded revenues of 15.35 trillion won and an operating income of 0.7 trillion won.

In total, in 2021, the company recorded an operating profit of 51.63 trillion won with a revenue of 279.6 trillion won.

Samsung stocks fell by 2.5 percent in Thursday’s trading.

Over the past 12 months, the company’s capitalization has fallen by 14.6%, as with the Kospi index in South Korea.

 

Oil falls while Brent is close to $90 per barrel

Brent crude futures for March fell by $0.69 (0.77%) on the London Futures Exchange, to $89.27 per barrel.

On Wednesday, the price of Brent crude rose $1.76 (2%) to $89.96 per barrel during transactions,
rising above $90 per barrel for the first time since October 2014.

The March futures price for West Texas Intermediate crude at the time,
was lower in electronic trading on the New York Mercantile Exchange (NYMEX) by $0.62 (0.71%), to $86.73 per barrel.

During the previous session, the futures contract rose by $1.75 (2%) to $87.35 per barrel.

The rise in prices on Wednesday increased tensions between Russia and the West over Ukraine,
as well as information on the decline in inventories at the terminal in Cushing,
where traded oil is being stored on NYMEX, to the lowest level for this time of year in the past 10 years.

The United States Department of Energy said that inventories in Cushing declined last week,
by 1.8 million barrels and in strategic petroleum reserves by 1.2 million barrels.

Intel results better than expected

The American company Intel, one of the world’s leading manufacturers of computer components,
cut its net profit by 21% in the fourth quarter of 2021 but increased its revenue by 3%, which was better than market expectations.

Intel’s net profit from October to December 2021 was about $4.6 billion, compared to $5.9 billion in the same period the previous year.

Stock dividend fell to $1.13 from $1.42.

Profits before non-recurrent factors fell to $1.09 per stock from $1.52 per stock a year earlier.

Analysts surveyed by FactSet expected an average of $0.9 per stock.

Intel’s quarterly revenues rose to $20.5 billion from $20 billion in the same period last year.

Analyst predictions for this index are $18.33 billion, and revenue excluding the production of memory chips,
which Intel sells to South Korean SK Hynix, was $19.53 billion, compared to $18.86 billion.

The company expected an adjusted profit for the fourth quarter of $0.9 per stock with revenue of about $18.3 billion.

In total, the company recorded net income for the past year of $19.9 billion or $4.86 per stock, earnings of $79 billion and revenues of $77.7 billion.

In the first quarter of 2022, Intel expects revenues of $18.3 billion, net income of $0.7 per stock and non-recurrent profits of $0.8 per stock.

Analysts expect an average adjusted Intel profit for the current quarter of $0.86 per stock on a return of $17.61 billion.

The company also announced that it had increased the year’s profit by 5% to $1.46 per stock.

Intel stocks fell by 2.75% in additional trading on Wednesday after the financial results were announced.

Over the past 12 months, the company’s stock price has fallen by 5%, while Standard & Poor’s has risen by 15%.

 

Tesla’s record net profit in 2021

The US electric car manufacturer, Tesla, posted a record net profit in 2021,
despite the fact that the company’s enterprises were not operating at full capacity due to supply chain problems.

These Tesla problems are expected to continue until the end of 2022.

According to a company press release, net annual income rose 7.7 times to $5.52 billion compared to $721 million the previous year.

In 2020, Tesla reached a profitable level for the first time at the end of the year.

The automaker’s revenue rose by 71% to $53.8 billion In 2021, and car sales jumped by 87% to a record 93600 cars.

In the fourth quarter, Tesla’s net income rose to $2.3 billion, or $2.05 per stock, compared to $270 million, or $0.24 per stock, in the same period last year.

Profits before non-recurrent factors were recorded at $2.54 per stock, exceeding the FactSet consensus of $2.36 per stock.

Tesla’s quarterly revenue rose by 65% to $17.7 billion, with an average market forecast for this index of $17.1 billion,
and car sales rose by 71%, to 308.65 thousand cars.

Tesla’s stock fell by 0.8 percent in additional trading on Wednesday.

Over the past 12 months, its value rose by 8.5%.

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