Today on Wall Street: The day before tomorrow
|06/09/2021 | 09:18am|
Today's session is likely to be overwhelmed by the stakes of Thursday's session, during which United States will release its much-anticipated inflation figures for May, while the European Central Bank is expected to communicate on its monetary policy. A form of stasis has already taken hold of markets.
Meanwhile, it appears that the richest Americans can sleep soundly, thanks to their tax experts. A previously unknown organization, ProPublica, revealed that the 25 richest Americans, including Jeff Bezos of Amazon, Warren Buffett of Berkshire Hathaway or Elon Musk of Tesla, pay very little tax on their wealth. Some years, they even pay nothing. They paid $13.6 billion in taxes from 2014 to 2018, or 15.8% of their income. That's not nothing, but it's a modest amount compared to the growth of their joint wealth, which increased by $401 billion over the period. This is due to loopholes in the US tax code and the fact that the US taxes income, not wealth. The debate for a fairer contribution has begun. ProPublica is expected to be sued for releasing this confidential information. And the U.S. Internal Revenue Service, the IRS, will get a slap on the wrist for leaking it.
In Washington, Democrats still have a lot of work to do to get their infrastructure investment plan accepted. Joe Biden, who has been personally involved in the discussions, has decided to return to a bipartisan strategy to overcome a setback with a group of Republican senators. The White House had already scaled back its ambitions, reducing the planned package from $2,300 billion to $1,700 billion. But the Republicans have only proposed $330 billion at this stage. Piling up billions was a major issue at election time and when the vaccine campaign was in its infancy, to build confidence among Americans. This is somewhat less true now that the economy is confirming a V-shaped recovery. It is therefore possible that the amount envisaged will continue to melt away in order to reach a political compromise. Joe Biden is leaving today for a European tour that will start in the United Kingdom and end in Geneva on June 16.
In other news, the stock market crash of American electric vehicle manufacturer Lordstown Motors, which announced yesterday, shows that continuity of operations is not guaranteed. The company is expected to generate about $65 million in sales this year and $423 million in losses. It explained that its current resources, $587 million anyway, do not allow it to start commercial production of its future electric pickup, whose pre-orders are high and which would be, according to its CEO, better than Ford's F-150 updated, presented as the future electric reference of the market. Lordstown's share price lost 16% yesterday. Its capitalization went from $6 billion in March to $2 billion currently.
Economic highlights of the day:
Two statistics in the United States today, wholesale inventories and weekly oil inventories (4:30 pm). This morning, China announced consumer prices in annual growth of 1.3% in May, for a consensus of 1.66%. On the other hand, Chinese producer prices jumped 9% over the period, above expectations, to a 13-year high.
The dollar is down to 0.8201. Gold is trading at USD 1895 per ounce. Oil rebounds to USD 70.34 for a barrel of WTI and USD 72.6 for a barrel of Brent. The T-Bond offers a 10-year yield of 1.53%. Bitcoin is trading around USD 35,000 each.
* United Parcel Service - The world's largest parcel delivery company on Wednesday set out its financial targets for the next three years, saying it was aiming for sales of more than $100 billion in 2023, up from $84.6 billion in 2020.
* Campbell Soup- announced Wednesday that it has lowered its earnings guidance for the current fiscal year, saying it has faced "additional headwinds" in an environment marked by rising prices, among other things.
* Lordstown Motors - The electric vehicle designer lost 3.7 percent in pre-market trading after falling 16.3 percent after warning that it wasn't sure it had the resources to launch commercial-scale production or to sustain its business.
* Fastly, the company whose outage knocked out many news websites around the world, said Wednesday that the incident was due to a software "bug" related to changes in settings at one of its customers.
* Clover Health Investments, which more than doubled in value Tuesday, is up 18 percent in pre-market trading and is expected to open at an all-time high. It is one of the stocks that retail investors are buying in droves to counter short sellers ("meme stocks"). Gamestop, another stock whose price has been boosted by this phenomenon, is up 2.4% in pre-market trading.
- APA Corporation: Johnson Rice upgrades to buy from accumulate, adjusts pt to $38 from $30
- Bank of America : Wells Fargo adjusts pt to $52 from $48, maintains overweight rating
- Biogen : Jefferies changes price target to $500 from $450, keeps buy rating
- Citigroup : BMO Capital lifts PT to $95 from $91, maintains outperform rating
- CMC Materials : Seaport Global upgrades the stock to buy from neutral, sets $180 price target
- Coupa Software Incorporated : Citigroup adjusts price target to $254 from $272, keeps neutral rating
- Goldman Sachs : BMO Capital changes pt to $436 from $432, maintains outperform rating
- JPMorgan Chase : BMO Capital adjusts price target to $140 from $147, maintains market perform rating
- Kosmos Energy : Johnson Rice upgrades stock to buy from accumulate, adjusts price target to $6.25 from $4.50
- Qiagen: Goldman Sachs research recommends the stock with a Buy rating.
- M&T Bank : Wells Fargo adjusts pt to $168 from $166, maintains equal weight rating
- NIO : Bank of China International initiates coverage with buy rating, $57 price target
- The Boeing Company: Goldman Sachs advises its customers to buy the stock. The target price is unchanged at $307.
- US Bancorp : Wells Fargo adjusts pt to $68 from $64, maintains overweight rating
- Visa : Credit Suisse raises pt to $285 from $280, keeps outperform rating