The Day at a Glance | February 2 2024

The Top

*Gross fixed investment in Mexico increased 19.2% YoY in November 2023.

*Non-farm payroll increased by 353 thousand jobs in January, above the market consensus of 180 thousand. The unemployment rate stood at 3.7%.

*INEGI published figures for the 3Q23 Tourism GDP, which recorded a 2.8% QoQ and 7.6% YoY increase.

*In Mexico, 112,100 new cars were sold in the first month of the year, according to data from INEGI and AMIA.

*The World Bank will provide countries with access to emergency funds for existing loans.

*Global markets positive and boosted by reports from Meta and Amazon. U.S. Treasury bonds rise after a surprisingly strong employment report.

Economic environment

Gross fixed investment in Mexico grew 19.2% YoY in November 2023. The reading set below the market forecast of a 26.2% increase, following a 25.5% rise in the previous month. Fixed investment increased in construction (20.7%), as residential (5.6%) and non-residential construction (34.4%) recorded YoY growth. Meanwhile, fixed investment in machinery and industrial equipment increased 17.6%, among growth in both domestically produced machinery (16.1%) and imported machinery (18.6%). On a month-on-month basis, gross fixed investment decreased by 1.3% in November. Private consumption in Mexico remained strong with an annual increase of 5.8%. Spending in imported goods grew by 35.1%, and in domestic goods and services by 1.6%. In November 2023, private consumption increased by 0.7% compared to the previous month. Gross fixed investment and private consumption contribute 25.6% and 70% to the gross domestic product, respectively.

Markets and companies

Global markets positive. S&P500 futures rose on Friday morning as three tech giants reported results. Meta shares surged +17% after the social media giant defied analysts’ expectations. Meanwhile, Amazon shares rose +6% for better-than-expected fourth-quarter results. However, Apple shares fell -3% after the company reported a decline in sales in China during the fiscal first quarter. These moves follow a rebound session in Wall Street, where the major indices rose around +1% each, a day after a sell-off triggered by the Federal Reserve signaling that a rate cut in March is unlikely. S&P500 futures are up +1.1%, Nasdaq +1.6%, and Dow Jones +0.4%. Additionally, U.S. Treasury bond yields rose on Friday as investors assessed a surprisingly strong jobs report; the yield on the 10-year Treasury increased 9 basis points to 3.955%. In Europe, stocks show positive movements. The Bank of England held interest rates steady on Thursday with an unexpected split vote highlighting the challenging outlook for policymakers as inflation approaches the target level. Preliminary inflation data for the Eurozone on Thursday revealed a slight slowdown in the annual increase in the headline consumer price index in January. In Asia, South Korea’s Kospi led gains, while China’s CSI 300 hit a new low since January 2019. The Shanghai Composite fell -1.5%. In Mexico, IPC futures are up (+0.94%), reaching 58,373 points. Oil prices indicate downward movements (WTI -0.7%; Brent -0.7%) after both contracts closed over -2% lower on Thursday due to unverified ceasefire reports between Israel and Hamas. It’s worth mentioning that on Thursday, two OPEC+ sources said the group has kept its oil output policy unchanged and will decide in March whether to extend or not the cuts. Natural gas prices are up. Meanwhile, the price of metals are down; gold -0.6%, silver -1.4%, and copper -0.2%. Lastly, cryptocurrencies are mostly negative; Bitcoin -0.36%, XRP -1.5%, Ethereum 0%. After yesterday’s trading session, the exchange rate fluctuated between a low of 17.04 and a high of 17.14, currently trading at 17.10.

Corporate news

*Meta shares surged 17% after the tech giant reported profits that tripled in the fourth quarter and issued its first-ever dividend payout. Earnings per share came in at $5.33, topping the $4.96 expected from analysts polled by Refinitiv.

*Amazon shares rose nearly 7% a day after posting earnings. Amazon’s fourth-quarter earnings were $1 per share, versus the 80 cents expected from analysts, per Refinitiv.

*Bristol-Myers Squibb shares increased 2.4% after the pharmaceutical company reported fourth-quarter adjusted earnings of $1.70 on revenues of $11.48 billion, topping estimates of $1.53 on revenues of $11.19 billion, according to Refinitiv.

*Chevron shares gained less than 1% after the company reported mixed earnings for the fourth quarter and raised its dividend by 8%. Adjusted earnings per share were $3.45, topping the $3.21 expected from analysts polled by Refinitiv.

*Exxon Mobil shares slipped less than 1% after the oil giant posted an earnings beat in the fourth quarter. The company reported $2.48 earnings per share, while analysts polled by Refinitiv had expected $2.21 per share. Meanwhile, net income fell 40% year-over-year due to weaker oil prices.

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