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Stocks rise following earnings data release. Investors shift focus to Meta!

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Tesla stocks rose a whopping 13.00% after market close supporting the SNP500 and NASDAQ.
Tesla earnings failed to achieve the expected earnings per share figure. However, the CEO has announced the company will accelerate its launch of more affordable cars prompting higher demand.
The SNP500 climbs to a 9-day high as earnings prompt higher demand! Visa and Pepsi confirm a higher Earnings Per Share figure and stronger than expected revenue.
The Australian Dollar is the best performing currency after Australia’s inflation rose to 3.5% and read higher than expectations.

USA500 Climbs To a 9-Day High!

The SNP500 is currently only trading 0.15% higher during the day’s first two sessions, however, indications point to a possible larger correction. The price of the USA500 trades above the day’s VWAP and above the 75-Bar EMA which acts as a trend line. In addition to this, the oscillator is hovering at 65.00 which signals buyers are controlling the market. For this reason, indicators point towards a further rise with the signals intensifying above $5,085.00.

The main price drivers continue to be earnings data from the night before as well as the latest US PMI Indexes. Of the 30 most influential stocks, 12 stocks are trading higher in pre-hours trading and 18 lower. However, the most volatile stocks are bullish hence why the USA500 is trading higher.

Tesla, Visa, Meta and NVIDIA are largely driving the upward price movement before the market opens. Visa is trading 2.41% higher as the company saw earnings rise by $0.10 from the previous quarter. Tesla on the other hand saw its earnings report trigger concern over the company’s profitability with profits tumbling 55%. However, Elon Musk has advised the company to start offering more affordable cars, which is expected to boost sales. For this reason, the stock trades 13% higher, which takes the stock back to the previous price range.

Lastly, another factor allowing investors to reconsider entering the stock market is the lower PMI data. The US Manufacturing PMI dropped to a 3-month low, and both sets of releases read considerably lower. Investors are hoping this data will increase the possibility of 3 rate cuts in 2024, which recently has been fading.

Investors tomorrow will turn their attention to the US Advanced GDP. As long as the data does not read significantly higher, investors are likely to maintain their buy position. However, equally investors will watch Meta’s quarterly earnings release after market close. Meta currently trades 44.00% higher in 2024 and is the 5th most influential stock for the SNP500.

AUDUSD – The Australian Dollar Rises Against All currencies!

The Australian Dollar is the best performing currency of the day as a result of higher inflation data. However, investors should note that the US Dollar Index and US Bond Yields are also trading considerably higher. Therefore, investors should be cautious of a currency “tug-of-war” scenario. If investors wish to avoid this, the EURAUD benefits traders with the weakening Euro and low spreads compared to most AUD Pairs.

In April, the composite PMI rose to 53.6 points, with services at 54.2 points and manufacturing at 49.9 points, suggesting industry recovery. However, this also highlights inflation risks, as Q1 CPI exceeded expectations at 1.0%, while year-on-year figures fell to 3.6%. Despite this, RBA officials maintain high interest rates to support the currency.

Michalis Efthymiou

Market Analyst

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

 

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