Follow us on Facebook

Recent Tweets


Subscribe to Our Blog | Newsletter

Please complete to receive our insights and newsletters.

Daily Market Report | March 4, 2022


U.S. Stocks Fall After Russia Shells Ukrainian Nuclear Plant – Wall Street Journal, 3/4/2022

  • U.S. stocks and global equity indexes fell as investor concerns mounted about Russia’s intensifying military campaign in Ukraine.
  • Russian shelling in southern Ukraine, which caused a fire at a nuclear power plant, intensified fears among investors Friday morning about Moscow’s tactics and concerns about a nuclear disaster.
  • However, officials said the fire didn’t affect essential equipment, lessening worries about reactor damage.
  • The Dow Jones Industrial Average dropped 524 points, or 1.6%, in morning trading. The S&P 500 fell 1.8% and the Nasdaq Composite declined 2.3%. Nine of the S&P 500’s 11 sectors were in the red, with only energy and utility companies rising.
  • A strong jobs number early Friday wasn’t enough to push major indexes higher. Many investors remained focused on Russia’s escalating military campaign and trying to assess how much tough Western sanctions on Russia will damage economic growth.
  • The invasion and rising commodity prices could further stoke inflation at a time when prices have already been at a 40-year high.
  • New data on Friday showed that the U.S. added 678,000 jobs in February, more than the 440,000 expected by economists surveyed by The Wall Street Journal.
  • In bond markets, the yield on the benchmark 10-year U.S. Treasury note declined to 1.710%, down from 1.843% Thursday.
  • Bond yields have swung wildly throughout the week as investors have monitored the Russian invasion, comments from Federal Reserve Chairman Jerome Powell and economic data.
  • The pan-continental Stoxx Europe 600 index fell 2.8% to trade close to its lowest level in nearly a year, reflecting concerns that Europe will bear the brunt of the economic fallout from the Russia-Ukraine crisis.
  • European bank stocks were hit particularly hard Friday.
  • Société Générale lost around 9.5% after the French lender said Thursday that its exposure to Russia stood at 18.6 billion euros, equivalent to over $20 billion, at the end of 2021.
  • Shares of Italian bank UniCredit tumbled around 13.6%.
  • Meanwhile, Uniper, a major German energy company that is owed about 950 million euros by the Russia-owned company behind the Nord Stream 2 pipeline, fell 12%.
  • Asian stocks dropped, in part reflecting Thursday’s action on Wall Street, where technology stocks sold off more than the broader market and U.S.-listed Chinese companies stumbled.
  • Japan’s Nikkei 225 closed 2.2% lower Friday. Hong Kong’s benchmark Hang Seng Index fell 2.5%, registering its lowest close since March 2020. In mainland China, the CSI 300 index fell 1.2% to its lowest close since July 2020.

Broadcom says enterprise spending ‘on fire,’ forecasts upbeat revenue – Reuters, 3/4/2022

  • Chip company Broadcom on Thursday forecast second-quarter revenue above Wall Street estimates on the back of strong demand from enterprise and cloud clients, and the ramp-up in 5G technology.
  • Adjusted revenue for the quarter ended Jan. 30 was $7.71 billion, up 16% year-on-year and slightly higher than Wall Street’s expectation for $7.60 billion.
  • Excluding items, the company earned $8.39 per share, beating estimates of $8.08.
  • Broadcom forecast current-quarter revenue of about $7.9 billion, compared with analysts’ average estimate of $7.43 billion, according to IBES data from Refinitiv.
  • Broadcom’s chief financial officer, Kirsten Spears, told analysts that the company’s hardware had an order backlog of over $25 billion at the end of the quarter compared with $22 billion in the previous quarter.

Marvell Technology Reports 4Q Profit, 68% Revenue Increase — Earnings Review – MarketWatch, 3/4/2022

  • Chip maker Marvell Technology’s results beat Wall Street targets and revenue reached $1.34 billion, the third consecutive quarter of more than a billion dollars in revenue.
  • Net revenue reached a record $1.34 billion from $797.8 million a year earlier.
  • Analysts expected about $1.32 billion, roughly the midpoint of Marvell’s guidance.
  • Fourth-quarter profit fell to $6.2 million from $16.5 million a year earlier.
  • On a per-share basis, the profit was a penny, or 50 cents as adjusted. Analysts surveyed by FactSet expected a loss of 3 cents a share and an adjusted profit of 48 cents a share, at the mid-range of the company’s guidance.
  • This quarter, Marvell expects a profit of a penny a share, plus or minus 4 cents, or 51 cents a share as adjusted, plus or minus 3 cents. It expects about $1.43 billion in revenue.
  • That compared with analysts’ forecast of a profit of 2 cents a share, or 49 cents a share as adjusted, and $1.38 billion in revenue.

Sweetgreen’s Sales Climb on Higher Prices, Return of Office Workers – Wall Street Journal, 3/4/2022

  • Shares of Sweetgreen rose 19% in extended-hours trading after the salad chain reported better-than-expected results and outlook, boosted by higher prices and workers increasingly returning to the office.
  • The company, which went public in November, reported revenue for the quarter was $96.4 million, up from $59.2 million a year earlier. Analysts expected sales of $84.7 million.
  • Same-store sales, which measures sales at stores opened at least 13 months, rose 36%. Analysts were expecting the metric at 17.8%. The rise was driven mostly by an increase in transactions. Higher prices also helped same-store sales in the quarter.
  • The company remained unprofitable. For the fourth quarter, it reported a net loss of $66.2 million, compared with a loss of $41.1 million a year earlier.
  • For the current year, Sweetgreen said it expects revenue to range from $515 million to $535 million. Analysts were expecting $513 million. Guidance for the current quarter was also ahead of expectations.

Gap shares rise after retailer issues strong earnings guidance, despite weak revenue outlook – CNBC, 3/4/2022

  • Gap shares climbed in after-hours trading Thursday after the apparel retailer offered an upbeat forecast for its profits in 2022, in spite of rising inflation and logistics challenges.
  • Revenue grew about 2% to $4.53 billion from $4.42 billion a year earlier.
  • That beat estimates for $4.49 billion. Compared with 2019 levels, however, Gap said its sales were down 3%.
  • Same-store sales — a key metric that tracks revenue at retail stores open for at least 12 months — grew 3% year over year, short of the 3.7% increase that analysts had been looking for. On a two-year basis, same-store sales were also up 3%.
  • Same-store sales at Athleta, Gap’s growing athletic apparel line for women, surged 42% on a two-year basis.
  • The company said Athleta is still on track to hit $2 billion in annual sales by 2023.
  • Banana Republic same-store sales dropped 2% from 2019 levels, in part due to ongoing store closures, the company said.
  • Gap swung to a loss in the three-month period ended Jan. 29 of $16 million, or 4 cents per share, compared with net income of $234 million, or 61 cents a share, a year earlier.
  • For the full year, Gap expects to earn between $1.85 and $2.05 per share, on an adjusted basis, with sales growing a low single digit percentage from 2021.
  • Analysts were projecting annual adjusted per-share earnings of $1.86, with sales up 1.6% from prior-year levels.

Tesla Gets Approval for Vehicle Production in Germany – Wall Street Journal, 3/4/2022

  • Tesla has secured local approvals in Germany to formally begin electric-vehicle productions at its new plant outside Berlin, a key pillar of Chief Executive Elon Musk’s push to rapidly boost output and sales.
  • Tesla’s plant is a shot across the bow of Europe’s established auto makers, who have invested billions of euros over the past few years to develop electric cars and catch up with the U.S. EV powerhouse.
  • Berlin, when fully operational, will have a production capacity to make 500,000 vehicles and will initially make Model Y compact crossover vehicles.
  • Tesla produced a total of just under one million vehicles last year globally. The plant is Tesla’s third, following Fremont, Calif., and Shanghai. Tesla expects to inaugurate production at a new plant in Austin, Texas, soon.

Amazon Moves to Force FTC Antitrust Decision on MGM Deal – Wall Street Journal, 3/4/2022

  • has given the Federal Trade Commission a fast-approaching deadline to deliver a verdict on its proposed $6.5 billion acquisition of the MGM movie and television studio, a move that could make it difficult for the agency to challenge the deal before the tech giant completes it.
  • Amazon recently certified to the FTC that it had provided all the information requested by antitrust investigators, according to people familiar with the matter.
  • That certification triggered a ticking clock for the FTC that expires in mid-March, the people said.
  • If the commission doesn’t file a legal challenge before the deadline, Amazon could be free to consummate the deal.

FedEx Suspends All Service to Russia and Belarus as War Intensifies – Bloomberg, 3/4/2022

  • FedEx has suspended all services in Russia and Belarus as fighting intensifies following the invasion of Ukraine.
  • FedEx earlier had suspended inbound service to Russia, but now has halted all package movements including domestic deliveries in both Russia and Belarus, according to an employee memo Friday.
  • The company had also suspended services to Ukraine.

Coal Runs Hot as Russia-Ukraine War Risks Europe’s Climate Agenda – Wall Street Journal, 3/4/2022

  • The war in Ukraine scrambled global energy markets, with one especially unloved commodity—coal—enjoying a renaissance as European countries look again at the dirty fuel to establish energy independence from Russia.
  • A surge in a benchmark thermal coal price to a record high of $446 a metric ton this week reflected this reordering of priorities among governments that have been trying to phase out the fossil fuel because of its contribution to climate change.
  • In the days after Russian troops crossed over Ukraine’s border, Poland asked Australia if it could supply coal that could displace Russian imports. Italy’s prime minister has suggested reviving coal-fired power plants because of fears of a breakdown in natural-gas supplies from Russia.
  • Germany signaled that it might extend the lifespan of coal plants that were due to close by 2030, days after it suspended certification of a pipeline that would have doubled the volume of gas it imports directly from Russia.
  • Futures for high energy Australian thermal coal added more than $140 a ton on Wednesday, according to ICE Futures Europe. Australia is one of the world’s top exporters of coal.
  • While prices were lower at $410 a ton on Friday, they remain well above the $134 a ton the commodity was fetching at the start of 2022. European prices also broke records.

Oil rally to power on as sanctions on Russia throttle market: Reuters poll – Reuters, 3/4/2022

  • A rally that has driven oil prices to their highest in almost a decade shows no signs of abating, as supplies from top exporter Russia are disrupted by sanctions after its invasion of Ukraine, a Reuters poll showed on Friday.
  • A survey of 35 economists and analysts forecast Brent crude would average around $91.15 a barrel this year, a jump from January’s $79.16 consensus and the highest 2022 estimate in all the Reuters surveys.
  • Among the most bullish predictions, JP Morgan expects $185 oil by the end of 2022 if disruption to Russian exports lasts that long, although its average for the year was $98.
  • The highest average predictions for 2022 were Rabobank and Raiffeisen with $111.43 and $110 respectively.
  • An estimated 8% of global supply has been disrupted in recent days.
  • The shortfall may not be offset by the International Energy Agency’s decision to release 60 million barrels from emergency reserves or a likely return of Iranian supply, analysts said.

Wheat Mounts Historic Week as War Sparks Deepening Supply Fears – Bloomberg, 3/4/2022

  • This week will go down in wheat trading history.
  • Chicago futures for the grain have soared 40% — the most ever — as Russia’s war in Ukraine upends global grain supplies. That puts prices at a 14-year high, and milling wheat in Paris reached an unprecedented 400 euros ($438 per ton).
  • Ukraine and Russia together account for a quarter of global trade of the staple, used in everything from bread to couscous and noodles. The conflict has closed major ports in Ukraine, and severed logistics and transport links.
  • That leaves grain importers flocking elsewhere, sparking “unprecedented” demand for spot supply, according to adviser Agritel in Paris. Corn is also nearing a decade high, and soybean oil reached a fresh record on Thursday.
  • The gains are accelerating global food inflation and raising concerns for countries reliant on foreign supply. That includes Egypt, which already had been struggling to maintain bread subsidies used by about 70 million people in the face of a pandemic.

Wall Street Is Pouncing on Russia’s Cheap Corporate Debt – Bloomberg, 3/4/2022

  • As the U.S. and allies tighten sanctions on Russia and choke off investor demand for its assets, parts of Wall Street are jumping on the buying opportunity that it’s creating.
  • Goldman Sachs Group and JPMorgan Chase have been purchasing beaten-down company bonds tied to Russia in recent days, as hedge funds that specialize in buying cheap credit look to load up on the assets, according to people with knowledge of the private transactions.
  • Banks routinely scoop up debt because clients asked them to, or because they expect to find ready buyers.
  • Goldman Sachs is primarily asking for corporate debt from the likes of Evraz, Gazprom and Russian Railways that matures within the next two years, and has made bids for Russian sovereign notes, the people said.


February Hiring Strongest Since Summer; Unemployment Falls to Pandemic Low – Wall Street Journal, 3/4/2022

  • The U.S. economy posted the strongest job growth in seven months in February and the unemployment rate fell to the lowest level since the pandemic, signs of a strong labor market ahead of a pivotal Federal Reserve meeting.
  • Employers added a seasonally adjusted 678,000 workers to their payrolls last month, the strongest gain since last July, the Labor Department said Friday.
  • The jobless rate, derived from a separate survey of households, fell to 3.8% from 4.0% a month earlier, edging closer to the pre-pandemic level of 3.5%.
  • Hourly wage gains, while still historically high, cooled from the prior month and aren’t keeping up with inflation. Wages grew 5.1% in the year through February—down from the prior month’s 5.5% gain.
  • The average hourly earnings of private-sector workers rose a penny from a month earlier, the smallest gain in 13 months. In January, earnings had risen by 19 cents.
  • Meanwhile, the labor-force participation rate—the share of people employed or looking for work—rose to 62.3% from 62.2%.
  • The latest data shows the labor force grew by 304,000 workers, a potential sign the effects of the pandemic—such as people not being able to work because they were sick or businesses scaling back hours due to the virus—are fading.
  • About 4.2 million people said in February they were unable to work because their employer closed or lost business because of the pandemic, down from 6 million the prior month.
  • Job growth was also stronger in prior months than initially reported, the agency said.
  • The economy added 481,000 jobs in January and 588,000 jobs in December.

Fed’s Powell Says Ukraine War Creates Risks of Higher Inflation – Wall Street Journal, 3/4/2022

  • Federal Reserve Chairman Jerome Powell said that Russia’s invasion of Ukraine was likely to push up inflation, a setback to central bank expectations that price pressures would diminish in the coming months.
  • Because of Russia’s role in global energy and other commodity markets, “we’re going to see upward pressure on inflation at least for a while,” Mr. Powell told the Senate Banking Committee on Thursday.
  • Sen. Richard Shelby (R., Ala.) pushed Mr. Powell to say whether he would follow the example set in the 1980s by former Fed Chairman Paul Volcker, who raised rates high enough to tame inflation, even though it caused a recession. “I would hope history will record that the answer to your question is yes,” said Mr. Powell.
  • “There’s already a lot of upward inflation pressure and additional pressure does probably raise the risk that inflation expectations will start to react in a way that is negative for controlling inflation,” Mr. Powell said.

Fed Should Raise Rates Near to 2% This Year, Evans Says – Bloomberg, 3/4/2022

  • Federal Reserve Bank of Chicago President Charles Evans said the central bank should increase interest rates to close to its “neutral” setting this year, implying as many as seven quarter-point hikes.
  • “If we were to do 25 basis points at each meeting, which may be more than I think is essential, but if we did it at each meeting, we’ll end the year at 1.75% to 2%,” he told CNBC in an interview Friday, referring to the target range for the Fed’s benchmark overnight policy rate.
  • “That is close enough to neutral that we could take quick action if it were necessary. Or we could stick or we could back off if that is what the case was.”
  • The so-called neutral rate in monetary policy is a theoretical level that neither speeds up nor slows down the economy. Fed officials in December estimated that to lie around 2.5%, according to their medium projection.

New York Fed’s Williams Supports March Rate Rise Despite Uncertain Outlook – Wall Street Journal, 3/4/2022

  • Federal Reserve Bank of New York President John Williams said Thursday he believes an interest rate increase this month is likely and that the U.S. central bank has the will and space to raise rates to lower inflation if price pressures don’t ease.
  • “We’re absolutely committed to bringing inflation back to 2% and taking the actions necessary to do that,” Mr. Williams said in a virtual appearance.
  • To tackle high levels of inflation by increasing short term rates, a rate rise “should happen in our next meeting in March,” Mr. Williams added.
  • More rate increases will likely be needed after this month and the Fed will also need to lower the size of its balance sheet, Mr. Williams said. But he added the high levels of uncertainty made worse by Russia’s war on Ukraine limit how much guidance Fed officials can provide.

Senate votes to end Covid-19 emergency declaration, Biden threatens veto – Politico, 3/4/2022

  • A bill by Senate Republicans to terminate the national emergency declaration for the Covid-19 pandemic passed 48 to 47 Thursday on a party-line vote.
  • Republicans brought the bill to the floor using a technical process under the National Emergencies Act, which allows for a simple majority floor vote if the committee of jurisdiction fails to take up the bill within two weeks.
  • Given several absences on the Democratic side of the aisle — with some members out sick with Covid and others mourning the death of a relative — the measure was able to pass.
  • The White House on Thursday pledged to veto the bill if it reached Biden’s desk, calling the GOP attempt to terminate the pandemic emergency declaration “a reckless and costly mistake.”

Iran, U.S. Close to Reviving Iranian Nuclear Deal – Wall Street Journal, 3/4/2022

  • The U.S. and Iran on Thursday were closing in on an agreement to restore the 2015 nuclear deal, although officials from both countries warned final issues still needed to be nailed down in the coming hours.
  • After weeks of intense negotiations in Vienna involving the U.S. and Iran, and Britain, France, Germany, Russia and China, senior diplomats said they were now within reach of an agreement that would restore the 2015 deal. That pact lifted most international sanctions on Tehran in exchange for strict but temporary restrictions on Iran’s nuclear work.
  • U.S. and Iranian officials cautioned there was at least one big issue that still needed solving: Iran has been pushing for more sanctions relief if the nuclear deal is restored. In particular, it wants the Islamic Revolutionary Guard Corps to be taken off Washington’s most significant terror sanctions list, the Foreign Terrorist Organization.
  • The U.S. has long pushed back against the demand given the Revolutionary Guard’s role across the Middle East backing designated terrorist groups such as Lebanon’s Hezbollah. A final decision would almost certainly need to be cleared at the highest levels in the Biden administration.

Biden to Finalize ‘Buy American’ Rule for Government Procurements – Wall Street Journal, 3/4/2022

  • The Biden administration is expected to complete rules that would speed up federal procurement policies to require a higher level of American-made products.
  • The new requirements, which President Biden is set to highlight during an event Friday at the White House, will mean that products obtained under the “Buy American” program will need to have at least 60% of the value of components made in the U.S., up from the current threshold of 55%.
  • The rules will increase that standard to 65% in 2024 and 75% by 2029, the White House said.
  • A senior administration official said the final rules would ensure that taxpayer dollars are used to create jobs in the U.S. and strengthen critical supply chains.


Russia’s Shelling of Ukrainian Nuclear Plant Sparks Alarm – Wall Street Journal, 3/4/2022

  • Russian shelling in southern Ukraine caused a fire at Europe’s largest nuclear power plant before Russian troops took control of the area, according to local authorities and international observers, raising fears that Moscow’s increasingly indiscriminate war could cause a global environmental disaster.
  • The fire, extinguished Friday morning, erupted at the Zaporizhzhia power plant’s training facility, Ukraine’s emergency service said. None of the plant’s six reactors, one of which is currently operational, were affected and there was no radiation leak. Both sides said Russian troops at the complex weren’t interfering with the plant’s staff.
  • Still, the skirmish sparked international outrage and fanned fears of a repeat of the 1986 nuclear disaster at Chernobyl that sent a vast plume of radioactive steam circling the world and left the region surrounding the plant uninhabitable.
  • Russia’s government blamed the Ukrainian military for the incident, which it called “an attempt at sabotage.”

Japan Sticks to Russian Oil and Gas, Bucking Western Pullouts – Wall Street Journal, 3/4/2022

  • The Japanese government and local companies are sticking with their Russian energy deals, defying a pullout led by Western companies.
  • Shutting off the flow of billions of dollars to Russia for oil and gas would be one of the biggest steps Tokyo could take to hurt Moscow. But Japanese officials say it could raise prices for consumers and increase dependence on the Middle East.
  • So far, Tokyo has sanctioned some Russian banks and President Vladimir Putin, while offering $100 million in aid to Ukraine. On Thursday, Prime Minister Fumio Kishida called Russia’s invasion of Ukraine an outrage that “we absolutely cannot accept.”
  • Japan’s hesitations are part of a larger global rethink about how fully to cut ties with Russia. Even the U.S., while imposing heavy sanctions on Moscow, still permits some business dealings with Russian government-controlled energy companies like Rosneft and Gazprom.

Sony, Honda to Team Up in Developing, Selling Electric Vehicles – Wall Street Journal, 3/4/2022

  • Honda Motor and Sony Group said they were teaming up to build electric vehicles, bringing together two big Japanese brands that have missed out on some major technology trends this century.
  • The companies said Friday they would form a joint venture that would start selling cars in 2025.
  • On Friday, Sony Chief Executive Officer Kenichiro Yoshida said his company wasn’t going to miss out on what he called the next megatrend: internet-connected electric cars. Sony hopes to leverage its prowess in videogames and video content, which have driven a revival at the company in recent years.
  • Honda CEO Toshihiro Mibe echoed Sony’s concerns. “Honda will not stand by and watch these changes happening. We want to be the one who takes the initiative in this transformation,” he said.
  1. Korea Feb inflation accelerates to near decade high amid Ukraine crisis – Reuters, 3/4/2022
  • South Korea’s consumer inflation hovered near a decade high in February and stood above the central bank’s 2% target for an 11th month, adding pressure on policymakers to raise interest rates amid surging oil prices due to the Russia-Ukraine crisis.
  • The consumer price index (CPI) for February rose 3.7% from a year earlier, government data showed on Friday, exceeding a 3.5% gain tipped in a Reuters survey and a notch below the decade high of 3.8% marked in November. It rose 3.6% in January.
  • The breakdown of data showed the cost of petroleum surged 19.4%, while that of housing rentals and outdoor dining increased 2.1% and 6.2%, respectively, year on year.
  • Core inflation, which excludes volatile food and energy costs, jumped 2.9% from a year earlier, the fastest since June 2009, in a sign that surging prices of fuel and other raw materials have fed through to higher costs for goods and services.
  • Separately on Friday, Finance Minister Hong Nam-ki said the country will extend the 20% tax cut in oil products by three months to minimise the impact of surging energy prices, pushed up by the Russia-Ukraine crisis.

Russian lender TCS posts record profit, focused on challenges – Reuters, 3/4/2022

  • Russian lender TCS Group Holding on Friday reported its 2021 net profit surged 43% in rouble terms to hit a new annual record, but said it was now focused on making sure its systems work as usual.
  • Full-year revenue grew by 40% to 273.9 billion roubles and the bank’s return on equity increased to 42.5% in 2021 from 50.6% a year earlier.
  • Last year’s net profit of 63.4 billion roubles ($561 million) came at around $860 million in dollar terms when calculated against the rouble’s 2021 average rate of 73.65.
  • The operator of Russia’s largest online bank Tinkoff, which had 20.8 million customers by year end, has not been sanctioned but trading of its London-listed global depositary receipts was suspended on Thursday along with several Russia-based companies.

Factmonster – TODAY in HISTORY

  • The Constitution of the United States went into effect. (1789)
  • Abraham Lincoln was inaugurated as president. (1861)
  • Jeannette Rankin took her seat as the first woman elected to the U.S. House of Representatives. (1917)

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. Historical performance is no guarantee of future results. All indices are unmanaged and may not be invested into directly. All investing involves risk including loss of principal. No strategy assures success or protects against loss. Any economic forecasts set forth may not develop as predicted. All company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. Material presented is excerpts derived from third party content and you may need a subscription to access the full the content. The views and opinions expressed are those of the authors and do not necessarily reflect the views of Pence Wealth Management or LPL Financial. Prior to making any investment decision please consult your financial advisor regarding your specific situation.

Share This Post!