The Day at a Glance | February 15 2024

The Top

*In Mexico, a record-high of $36.058 billion in Foreign Direct Investment (FDI) was attracted in 2023, the largest amount since records have been kept. 

*Retail sales in the U.S. decreased by -0.8% month-on-month (0.6% expected) in January 2024, following a 0.6% month-on-month growth at the end of 2023. 

*Japan and the United Kingdom entered a technical recession in the second half of 2023. 

*The European Commission reduced growth forecasts for the Eurozone in 2024 and expects lower inflation. 

*The number of people filing for unemployment benefits in the U.S. decreased by 8,000 from the upwardly revised figure in the previous week to 212,000 in the period ending on February 9th (220,000 expected).

*Around 82% of S&P 500 companies have reported fourth-quarter results. On average, the results exceed consensus estimates by 7.1%.

Economic environment

In Mexico, $36.058 billion in Foreign Direct Investment (FDI) was attracted in 2023, an all-time high since records have been kept. Compared to 2022, FDI grew by 2.2%; however, extraordinary events occurred in that year, such as the Televisa-Univisión merger and the restructuring of Aeroméxico. Excluding these events, FDI growth in 2023 would set 27%. Regarding FDI components, 74% corresponds to reinvestment of profits, 13% to new investments, and the rest to inter-company transactions. Considering the country of origin, the top three are the United States, Spain, and Canada. By states, 31% of the investment was concentrated in Mexico City, 8% in Sonora, 7% in Nuevo León, and the remainder in other states of the Republic.

Markets and companies

Global markets with positive sentiment. Futures for major US indices are up, with the Dow Jones increasing by 0.31%, the S&P 500 by 0.44%, and the Nasdaq 100 up by 0.48%. Meanwhile, the 10-year Treasury bond yield is at 4.20%. European markets are on the rise, evaluating UK fourth-quarter growth figures and monitoring corporate earnings reports. The Stoxx 600 index rose by 0.68%, with most sectors in positive territory. Asia-Pacific markets rebounded after mostly falling on Wednesday, with Japan entering a technical recession as its GDP contracted for the second consecutive quarter. Japan’s Nikkei 225 experienced a late rally, rising by 1.21% to close at 38,157.94, marking the first time the index closed above the 38,000 mark since 1990. China remained unchanged. In Mexico, IPC futures continue to rise, standing at 58,824 points (+1.01%). Oil prices retreated after US crude inventories increased more than expected, raising concerns about demand in the world’s largest economy. The price is at $76.47 per barrel. Natural gas prices are on the rise. Gold struggled near a two-month low as comments from two US representatives were evaluated. Gold is trading at $2,001.53 per ounce. Silver is trading at $22.78 per ounce, and copper at $373.25 per pound. Finally, cryptocurrencies are on the rise, with Bitcoin trading at $52,175.

After yesterday’s trading session, the exchange rate fluctuated between a low of 17.0 and a high of 17.10, currently trading at 17.06.

Fibra Monterrey reported better-than-expected results, with a year-on-year increase of 61.2% in revenues. The net operating income (NOI) and funds from operations (FFO) increased by 69.00% and 26.5% year-on-year, respectively. The results reflect the acquisition of the industrial portfolio “Zeus.” The occupancy rate as of December 31, 2023, was 96.3%. The distribution for the fourth quarter of 2023 will be Ps. 0.225 per CBFI.

Corporate news

*Tripadvisor rose by 6% after beating both revenue and earnings estimates.

*Cisco announced more than 4,000 job cuts, representing a 5% reduction in its global workforce. The technology company is the latest in a series of layoff announcements aimed at restructuring and cost savings.

*Berkshire Hathaway reduced several holdings during the fourth quarter, including Apple and HP.

*Tripadvisor rose by 7% after fourth-quarter results surpassed Wall Street estimates for both revenue and earnings.

*Twilio, a technology stock, fell by 11%. Twilio’s revenue guidance for the fourth quarter was weaker than expected.