The Day at a Glance | March 6 2024

The Top

*In the first two months of 2024, 625,804 light vehicles were produced, and 536,975 units were exported.

*The ADP private employment survey reports the creation of 140,000 jobs in February.

*Donald Trump and Joe Biden dominate the “Super Tuesday” contests and are heading for a rematch in the presidential elections.

*Jerome Powell, Chairman of the Federal Reserve, will present his semi-annual report to U.S. lawmakers today.

*Retail sales in the eurozone fell -1.0% YoY in January 2024 (-1.3%e.).

*In Mexico, consumer confidence decreased from 47.1 points in January to 47 points in February 2024.

*Futures for U.S. indices are up after a drop was recorded yesterday, mostly in the tech sector. 

Economic environment

In the first two months of 2024, 222,357 light vehicles were sold, 625,804 units were produced, and 536,975 cars were exported. Regarding sales and for the first two months of the year, there was an annual growth of +14.8%, for production +8.6%, and for exports +14.6%. By brand and compared to the first two months of 2023, the highest increases in production were in Volkswagen with an increase of 81.5%, followed by Ford and BMW with 55.4% and 48.7%, respectively. On the export side, the brands with the highest annual growth in the January-February period were BMW with 76.1%, Nissan with 72.9%, and Honda with 75.6%. Audi reported a drop in production and exports in February by 57.0% and 85.2%, respectively, which is associated with the strike that ended in mid-February. Every month, INEGI collects information from the 23 companies affiliated with the Mexican Association of the Automotive Industry (AMIA), Giant Motors Latin America, and Autos Orientales Picacho. The automotive sector data shows dynamism, anticipating that automotive exports in February could rebound once the number of exported units grew by 22.6% in that month.

The ADP private employment survey reported 140,000 new jobs in February. In the second month of the year, the ADP survey showed job creation below the 150,000 expected by the market. By sector, services generated 110,000 jobs, with 41,000 coming from the leisure and hospitality sector, while in goods, 30,000 jobs were generated, almost all of which came from the construction sector (28,000). ADP employment figures anticipate a moderate report for non-farm payrolls on Friday, with consensus estimating 200,000 jobs.

Markets and companies

Global markets up. Futures linked to U.S. indices show upward movements after Tuesday’s sell-off. Yesterday, the three main indices fell at least 1%. Investors sold large-cap tech names, fueling Tuesday’s losses and marking the worst day for the tech sector since January 2nd. It is also noteworthy that this morning the Fed’s Chair stated that policymakers remain attentive to the risks posed by inflation and do not want to ease measures too quickly. He reiterated that he expects interest rates to start coming down this year but is not yet ready to say when. In Europe, the Stoxx 600 was slightly up (+0.2%) in afternoon trading, with most sectors operating in positive territory. Chemicals and utilities stocks rose 1.3%, while media retreated 0.8%. In Asia, markets reversed early declines to mostly rise on Wednesday, with Hong Kong stocks leading gains in the region. The Hang Seng index rose more than 2% earlier in the session, before paring gains, while mainland Chinese stocks slid. In Mexico, IPyC futures are observed to be up (+0.58%), standing at 55,797 points. Oil prices rose ahead of Powell’s testimony before Congress and the release of U.S. inventory data; WTI +1.1%, Brent +0.8%. Meanwhile, metals are up: gold +0.4%, silver +0.5%, copper +0.4%. Finally, cryptocurrencies show significant upward movements: Bitcoin +6.13%, Ether +12.2%, Litecoin +6.04%. After yesterday´s trading session, the exchange rate fluctuated between a low of 16.87 and a high of 16.95, currently trading at 16.87.

Fibra Prologis made an offer worth 120 million Real Estate Investment Trust Certificates (CBFIs) at a price of Ps.70 per certificate, resulting in a total offer amount of Ps. 8,400 million. The offer included a public offering in Mexico and a concurrent international offering of CBFIs in the United States to qualified institutional investors.

Corporate news

*Target shares rose almost 8% after a stronger-than-expected fourth-quarter report. 

*Apple shares fell 2.3% after a report from Counterpoint Research indicated a 24% drop in iPhone sales in China during the first six weeks of 2024 compared to the previous year. 

*Tesla shares fell 2.5%. The company halted production on Tuesday at its Berlin plant after a power outage due to a nearby fire, according to Reuters, citing a German news report. 

*Microstrategy shares fell 3.6% after the bitcoin development company announced a private offering of $600 million in convertible senior notes. Microstrategy said it will use the proceeds to buy more bitcoin and for general corporate purposes. 

*Advanced Micro Devices shares fell almost 2% after U.S. regulators blocked the semiconductor company from selling its artificial intelligence chips designed for China, Bloomberg reported. The chips are reportedly too powerful and will require a license from the Department of Commerce’s Bureau of Industry and Security to be sold.