London, Tuesday, 3 May 2022
US Markets Summary
On Tuesday, US equities climbed for a second day as investors awaited the Federal Reserve's policy decision and weighed in on a slew of positive business reports and solid economic data.
On Wednesday, the Fed is likely to announce a 50 basis point rate hike, the largest since 2000, as well as confirmation of plans to begin decreasing its $9 trillion asset portfolio by $95 billion each month in June.
Markets expect the Fed to raise rates to a range of 2.25 percent to 2.5 percent or higher by December, with the focus on Fed Chair Powell's news conference for indications on the rate hike trajectory to combat inflation, which is at a 4-year high.
In company news, Pfizer posted a better-than-expected first quarter; Expedia Group Inc. posted revenue that was in line with analysts' expectations, and Elliott Investment Management LP revealed a 6.1% interest in Western Digital Corp. In addition, factory orders increased by twice as much as expected in March, and job opportunities reached an all-time high of 11.5 million.
European Markets Summary
The regional STOXX 600 and the DAX 30 indexes both rose 0.5 percent and 0.7 percent on Tuesday, as investors absorbed a spate of earnings reports while bracing for the impact of tighter monetary conditions throughout the world.
Following positive first-quarter earnings, Danish facility management company ISS gained almost 13%, leading advances in the STOXX index.
BNP Paribas' stock jumped more than 5% after the bank reported a 19.2% increase in first-quarter net earnings, aided by a strong increase in trading activity, and confirmed its 2025 projection.
In addition, BP reported a $1.5 billion loss from its pullout from Russia, despite announcing a $2.5 billion share repurchase programme.
Aside from a hectic day of earnings, investors digested Australia's central bank's larger-than-expected 25bps rate hike while preparing portfolios for the Federal Reserve's 50bps rate hike on Wednesday, the largest rate hike since 2000.
(Written and edited by: The Decision Maker)