Media Room
The week in the markets -
April 28, 2023
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Big Tech delivers
The ongoing earnings season for U.S.-listed stocks is progressing rapidly, with nearly half of the companies having released their Q1 results. As of Thursday's market open, a striking 81% of the 232 reporting companies had surpassed earnings expectations. The standout story emerging from this earnings season has been the impressive performance of Big Tech. Microsoft saw a 10% increase in profits, driven primarily by AI stimulating sales, according to the company's commentary. Alphabet (Google) unveiled a colossal US$70 billion stock buyback program and proudly announced that its cloud computing unit turned profitable for the first time. Meta, formerly known as Facebook, also delivered a strong quarter, demonstrating improvements across the board. These results highlight the stock market's resilience, even in the face of less-than-stellar macroeconomic data.
First Republic Bank's recent earnings release serves as a reminder that the banking crisis is far from over, echoing earlier warnings from Warren Buffet and Jamie Dimon. The bank disclosed a staggering US$100 billion loss in deposits over the last quarter, sending its stock to new lows and dampening hopes for a swift resolution to the crisis.
On the macroeconomic front, manufacturing data proved to be disappointing this week. Although the New York (Empire) results last week had sparked optimism for potential surprises, subsequent data from Philadelphia, Dallas and Chicago fell significantly short of expectations.
Thursday's U.S. gross domestic product (GDP) figures came in at a modest 1.1%, slightly lower than anticipated. In addition, the Fed's preferred inflation measure, personal consumption expenditures, came in at 4.2% (from its expected 4.1%), which reinforced the downward trend of overall inflation, as it slowly inched downwards. While this trend is positive, it’s higher than the 2% target, which means inflation is still stickier in parts of the economy. Despite these headwinds, consumer spending remains robust, buoyed by a resilient labour market. The weaker GDP is primarily attributed to inventory challenges. While this data might suggest that the Fed should continue raising interest rates at the next meeting, the ongoing issues in the banking sector could prompt a pause. Market participants will be watching the Fed's decision with keen interest.
This week's market closing value - week ending April 28, 2023
(As of 4:00 PM ET.*)
| EQUITY INDICES | Level | Change | 1-week | YTD | 1-year | 5-year |
| CAD | CAD | CAD | CAD | |||
| S&P/TSX | 20,631.89 | -36.79 | -0.18% | 6.51% | -1.01% | 5.74% |
| S&P 500 | 4,160.18 | 31.16 | 0.86% | 8.82% | 6.01% | 10.63% |
| DJIA | 34,098.95 | 289.86 | 0.96% | 2.95% | 9.03% | 8.29% |
| FTSE 100 | 7,870.57 | -43.56 | 0.50% | 9.85% | 9.93% | 0.19% |
| CAC 40 | 7,491.50 | -85.50 | -0.79% | 19.18% | 26.32% | 5.49% |
| DAX | 15,922.38 | 40.72 | 0.60% | 17.77% | 24.43% | 3.97% |
| Nikkei | 28,856.44 | 292.07 | -0.50% | 6.60% | 7.96% | 1.69% |
| Hang Seng | 19,894.57 | -181.16 | -0.83% | 0.08% | -0.57% | -7.39% |
| CURRENCY RETURNS | CAD | Change | 1-week | YTD | 1-year | 5-year |
|---|---|---|---|---|---|---|
| USD | 1.3550 | 0.0014 | 0.10% | 0.08% | 5.44% | 1.08% |
| Euro | 1.4930 | 0.0051 | 0.34% | 2.99% | 10.17% | -0.76% |
| Yen | 0.0099 | -0.0002 | -1.51% | -3.60% | 0.45% | -3.28% |
| CANADIAN TREASURIES | Yield | Change | COMMODITIES | USD | Change |
|---|---|---|---|---|---|
| 3-month | 4.35 | -0.05 | Oil | $76.62 | -$1.15 |
| 5-year | 2.98 | -0.12 | Gold | $1,988.22 | $6.06 |
| 10-year | 2.85 | -0.09 | Natural Gas | $2.40 | $0.19 |
| CANADIAN PRIME RATE |
|---|
| 6.70% |
*The data contained in the charts above is provided by Bloomberg as of 4:00 PM ET. Please note that the final closing market values may vary due to data delays and market settlement.
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