The Day at a Glance | May 24 2024

The Top

In April, Mexico’s trade balance recorded a deficit worth$3.746 billion, compared to a $1.646 billion deficit in the same month of 2023.

• Durable goods orders in the U.S. increased 0.7% month-over-month, more than expected in April (-0.8%); however, excluding the most volatile items (transportation and defense), there was a -1.6% month-over-month decline.

• Bundesbank President Joachim Nagel said on Friday that it is more likely that the European Central Bank will adjust interest rates in June if price trends remain stable.

• According to Reuters, Russian President Vladimir Putin is willing to end the war in Ukraine with a negotiated ceasefire that recognizes the current battlefield lines.

• Oil prices remained stable on Friday, near a three-month low, amidst persistent concerns that inflation’s resistance to decline towards its target could prolong high interest rates and curb fuel demand.

Economic Environment

In April, Mexico’s trade balance recorded a deficit worth $3.746 billion, compared to a $1.646 billion deficit in the same month of 2023. In April, exports logged an annual 11.4% increase, driven by a 13.1% rise in non-oil exports and a -17.5% decline in oil exports. Within non-oil exports, those directed to the U.S. increased by 13.8% annually, and those directed to the rest of the world rose by 9.5%. As for imports, they recorded a positive 15.4% year-over-year reading in April. This result came from a 19.8% rise in non-oil imports and a 28.2% decrease in oil imports. By type of good, consumer goods imports increased 25.6%, intermediate goods 11.5%, and capital goods 32.5%. Thus, in the first four months of the year, the trade balance logged a deficit worth $6.452 billion, compared to a deficit of $6.464 billion in the same period of the previous year.

Markets and companies

Main U.S. stock indices are rebounding after yesterday’s decline, while for the week, the S&P and DJI are expected to end with losses. Yesterday, the market responded positively to Nvidia’s earnings report and guidance. However, the minutes from the latest Federal Reserve meeting rekindled doubts about interest rate cuts for this year, as members expressed concern about inflation levels remaining above their target. Additionally, indicators continue to reflect strength in the U.S. economy, with durable goods orders growing more than expected in April. In Asia, markets closed with declines, and a negative bias is also observed in Europe.

Regarding commodities, oil prices continue to decline, likely ending the week lower. The market will keep an eye on theOPEC+ meeting on June 2^nd, where the possibility of maintaining production cuts to support prices will be discussed. Meanwhile, gold is up today, although it is on track to end the week lower.

In Mexico, the IPC is trading lower, standing at 56,813.8 points.

The exchange rate of the peso against the dollar is at 16.73, after closing at 16.72 yesterday.

Corporate news

• Nvidia shares increased significantly yesterday following a positive earnings report and guidance. This pushed the company’s shares to a new all-time high, surpassing $1,000 per share.

• Guardant Health shares rose after the FDA determined that the benefits of its colon cancer test outweigh the risks.

• Ross Stores reported better-than-expected quarterly earnings, with its shares rising nearly 7%.