Category: Main News

(C) Reuters. FILE PHOTO: A representation of bitcoin is seen in an illustration picture taken on June 23, 2017. REUTERS/Benoit Tessier/File Photo

By Hannah Lang and Akriti Sharma

(Reuters) – Silvergate Capital (NYSE:SI) Corp said on Friday it made a “risk-based decision” to discontinue the Silvergate Exchange Network, its crypto payments network, two days after the digital asset-focused bank raised doubts about its viability.

“Effective immediately Silvergate Bank has made a risk-based decision to discontinue the Silvergate Exchange Network (SEN). All other deposit-related services remain operational,” Silvergate said in a statement posted on its website.

The Silvergate Exchange Network, one of the bank’s most popular offerings, enabled round-the-clock transfers between investors and crypto exchanges, unlike traditional bank wires, which can often take days to settle.

Silvergate shares on Friday slumped more than 2% in after-hours trading, after closing up 0.9% at $5.77 in regular trade. The shares on Thursday had fallen to a record low, ending the day down more than 97% from their all-time high in November 2021.

Silvergate on Wednesday warned in a filing that it was evaluating its ability to operate as a going concern, disclosing that it had sold additional debt securities this year at a loss and that further losses mean the bank could be “less than well capitalized.”

After the warning, cryptocurrency heavyweights including Coinbase (NASDAQ:COIN) Global Inc and Galaxy Digital dropped Silvergate as their banking partner. Stablecoin issuers Paxos and Circle, Cboe’s digital asset exchange, and crypto exchanges Bitstamp and Gemini also suspended their partnerships with Silvergate.

(C) Reuters. FILE PHOTO: A man watches an electric board showing Nikkei index outside a brokerage at a business district in Tokyo, Japan, June 21, 2021. REUTERS/Kim Kyung-Hoon

By Lawrence Delevingne and Elizabeth Howcroft

(Reuters) – Wall Street stocks posted strong gains while Treasury yields and the dollar pulled back on Friday as data pointing to U.S. economic growth boosted risk appetite, even as expectations for rate hikes kept bond yields near multi-year highs.

The U.S. services sector grew at a steady clip in February, with new orders and employment rising to more than one-year highs, suggesting the economy continued to expand in the first quarter.

U.S. shares jumped, with the Dow Jones Industrial Average up 1.17%, the S&P 500 1.61% higher, and the Nasdaq Composite adding nearly 2%.

“Following weeks of relentless upward pressure on interest rates, the S&P 500 got a bit of a reprieve today,” said Bill Sterling, global strategist at GW&K Investment Management in Boston.

He added that the small differential between shorter-term bonds indicated lower recession risk: “Market participants seem to be saying that the economy – and corporate profits – can withstand a higher-for-longer interest rate path.”

Asian stocks already jumped on investor optimism of a Chinese economic rebound. The positive market sentiment continued during the European session, with Europe’s STOXX 600 up 0.92%.

The recovery in euro zone business activity gathered pace last month, PMI survey data showed, in the latest piece of data to suggest the bloc would avoid a recession.

But euro zone government bond yields were still near their highest levels in years after euro zone inflation data on Thursday drove market expectations for the European Central Bank’s (ECB) terminal rate to around 4%.

At 2.688%, the benchmark 10-year German yield was near its highest level since 2011.

U.S. Treasury yields paused their rally. The U.S. 10-year Treasury yield fell to 3.960%, down from Thursday’s high of 4.091%. The two-year Treasury yield, which typically moves in step with interest rate expectations, dipped 4.3 basis points at 4.859%.

Federal Reserve Bank of Boston President Susan Collins reiterated in comments made public Friday that more central bank rate rises will be needed to lower high inflation levels.

Investors are trying to gauge that exact path for Federal Reserve rate hikes, after strong U.S. data in recent weeks suggested rates may need to be higher for longer.

“Our overall view is still more consistent with slow disinflation amid some further improvement to global growth,” Goldman Sachs (NYSE:GS) market strategists wrote in a note late Thursday. “That mix should maintain the upward pressure on yields but ultimately limit the damage to equities and provide an overdue tailwind to commodities.”

The MSCI world equity index, which tracks shares in 47 countries, jumped 1.47% on the day, up 5.8% for the year.

DOLLAR RETREATS

The euro ticked up 0.33% on the day, while the U.S. dollar slid from a 2-1/2-month high versus the Japanese yen on Friday, its largest weekly loss since mid-January against a basket of six major currencies.

Analysts polled by Reuters were unfazed by the dollar’s recent strength, up about 7% over the last 12 months, and predicted a weaker greenback in a year amid an improving global economy and expectations the Fed will stop hiking interest rates well ahead of the ECB.

Oil prices rose, recovering from an early slump after Reuters reported that the United Arab Emirates is not planning an exit from the Organization of Petroleum Exporting Countries (OPEC). U.S. crude rose 2% to $79.73 per barrel and Brent was at $85.86, up 1.31% on the day.

Spot gold added 1% to $1,854 an ounce.

Bitcoin was down nearly 5% at around $22,381, its lowest price since Feb. 15.

(C) Reuters.

By Yasin Ebrahim

Investing.com — The S&P 500 rallied Friday, searching for its first weekly in gain in four weeks as Treasury yields eased from more than decade highs.

The S&P 500 gained 1.5%, the Dow Jones Industrial Average added 1.04%, or 352 points, and the Nasdaq Composite was up 1.9%.

The 10-year Treasury yield moved back below the key 4% level after recently hitting its highest level since 2010. The retreat in yields comes even as data showing an expected return to growth in U.S. services activity for the first time in eight months suggested the economy remains resilient enough to withstand further rate hikes.

“Demand has clearly slowed on the goods side of the economy, but the service sector is still cranking,” Jefferies said in a note. “Service sector businesses are still having difficulty in meeting demand.”

Strong economic data has forced investors to rethink how much more Fed tightening is needed to materially slow the economy.

Investors are now forecasting the Fed to lift rates to a terminal rate as high as 5.46%, well above the 4.95% level seen at the end of last year, Stifel said in a note.

Growth sectors of the economy including consumer discretionary and tech, both of which are vulnerable to rising rates, were bolstered by the fall in Treasury yields.

Tesla (NASDAQ:TSLA) was the biggest gainer in consumer stocks following data showing that demand in China rose after the electric vehicle maker cut prices.

Tesla’s monthly sales climbed 13% to 74,402 vehicles in February, according to preliminary data from China’s Passenger Car Association released Friday.

In tech, Apple Inc (NASDAQ:AAPL) rallied more than 3% after Morgan Stanley reiterated its Buy rating on the stock, citing “underappreciated catalysts” including iPhone and services gross margins near all-time highs and future product launches.

Meta Platforms (NASDAQ:META) was also in the ascendency, up more than 6%, after the social media giant cut the price of its virtual reality headsets at a time when Wall Street continues to talk up the company’s potential boost from artificial intelligence.

In other AI-related stock news, C3 AI Inc (NYSE:AI) reported fiscal third-quarter results that beat Wall Street’s expectations, driven by new business wins and the expansion of partnerships, sending its shares up 33%.

The AI enterprise company also delivered upbeat guidance, with management reiterating their target to reach non-GAAP operating profitability by the fiscal fourth quarter.

Semiconductor stocks also pushed tech higher, underpinned by a more 5% jump in Broadcom Inc (NASDAQ:AVGO) after the chipmaker delivered stronger than expected guidance and its quarterly results topped estimates.

The chipmaker is “well positioned for a soft landing,” UBS says, as its positioning in “high-end networking and compute offload should prove highly advantageous as hyperscalers look to rapidly scale AI infrastructure.”

Marvell Technology (NASDAQ:MRVL) took some shine off chip stocks after reporting mixed fourth-quarter results and guidance that fell short of estimates as it continues to work through bloated inventory levels following pandemic-led stockpiling.

Elsewhere on the earnings front, Costco Wholesale (NASDAQ:COST) reported fiscal second-quarter earnings that beat estimates, but revenue and February same-store sales fell short amid a weaker consumer.

Goldman Sachs said it continued to have confidence in COST’s value proposition continuing to resonate with consumers and noted that the wholesale retailer’s management attributed the weakness in February to adverse weather.

(C) Reuters.

By Yasin Ebrahim

Investing.com — The Dow rallied Friday, snapping a four-week losing streak as growth stocks including tech fought back from their selloff after Treasury yields eased from more than a decade highs.

The Dow Jones Industrial Average added 1.2%, or 386 points, closing the week 1.7% higher. The Nasdaq Composite was up 2%. The S&P 500 gained 1.6%.

The 10-year Treasury yield moved back below the key 4% level after recently hitting its highest level since 2010. The retreat in yields comes even as data showing an expected return to growth in U.S. services activity for the first time in eight months suggested the economy remains resilient enough to withstand further rate hikes.

The recent string of strong economic data has forced investors to rethink how much more Fed tightening is needed to materially slow the economy. Markets are now forecasting the Fed to lift rates to a terminal rate as high as 5.46%, well above the 4.95% level seen at the end of last year, Stifel said in a note.

Still, with the Fed closing in on the end of its rate-hike cycle, some on Wall Street believe the trend for the year is higher and pullbacks in the broader market are a buying opportunity.

“For long term investors, the recent pullbacks are buying opportunities,” Jimmy Lee, Founder and CEO of The Wealth Consulting Group, told Investing.com’s Yasin Ebrahim in an interview earlier this week.

“The main point that investors need to understand is that the fed is going to stop raising rates probably before the summer starts,” Lee added. “And if that happens, I think that a lot of late money will come into the market.”

Growth sectors of the economy including consumer discretionary and tech, both of which are vulnerable to rising rates, were bolstered by the fall in Treasury yields.

Tesla (NASDAQ:TSLA) was the biggest gainer in consumer stocks, up 3.6%, following data showing that demand in China rose after the electric vehicle maker cut prices.

Tesla’s monthly sales climbed 13% to 74,402 vehicles in February, according to preliminary data from China’s Passenger Car Association released Friday.

In tech, Apple Inc (NASDAQ:AAPL) rallied more than 3% after Morgan Stanley reiterated its Buy rating on the stock, citing “underappreciated catalysts” including iPhone and services gross margins near all-time highs and future product launches.

Meta Platforms (NASDAQ:META) was also in the ascendency, up more than 6%, after the social media giant cut the price of its virtual reality headsets at a time when Wall Street continues to talk up the company’s potential boost from artificial intelligence.

In other AI-related stock news, C3 AI Inc (NYSE:AI) reported fiscal third-quarter results that beat Wall Street’s expectations, driven by new business wins and the expansion of partnerships, sending its shares up 33%.

The AI enterprise company also delivered upbeat guidance, with management reiterating their target to reach non-GAAP operating profitability by the fiscal fourth quarter.

Semiconductor stocks also pushed tech higher, underpinned by a more than 5% jump in Broadcom Inc (NASDAQ:AVGO) after the chipmaker delivered stronger than expected guidance and its quarterly results topped estimates.

The chipmaker is “well positioned for a soft landing,” UBS says, as its positioning in “high-end networking and compute offload should prove highly advantageous as hyperscalers look to rapidly scale AI infrastructure.”

Marvell Technology (NASDAQ:MRVL) took some shine off chip stocks after reporting mixed fourth-quarter results and guidance that fell short of estimates as it continues to work through bloated inventory levels following pandemic-led stockpiling.

Elsewhere on the earnings front, Costco Wholesale (NASDAQ:COST) reported fiscal second-quarter earnings that beat estimates, but revenue and February same-store sales fell short amid a weaker consumer.

Goldman Sachs said it continued to have confidence in COST’s value proposition continuing to resonate with consumers and noted that the wholesale retailer’s management attributed the weakness in February to adverse weather.

(C) Reuters.

By Liz Moyer

Investing.com — U.S. stocks were rising on Friday as Treasury yields fell back from key levels.

At 10:46 ET (15:46 GMT), the Dow Jones Industrial Average was up 114 points or 0.4%, while the S&P 500 was up 0.8% and the NASDAQ Composite was up 1.2%.

The 10-year Treasury dipped back below 4% earlier on Friday after reading a four-month high a day earlier. The 2-year Treasury was at 4.855% after reaching highs not seen since 2007.

Economic data continues to show a tight labor market and higher costs for businesses, stoking concerns the Federal Reserve would have to continue raising interest rates. Fed Gov. Chris Waller and Atlanta Fed President Raphael Bostic said Thursday they were open to raising rates by more than they previously thought would be necessary.

The market is now betting the benchmark rate will reach closer to 5.5% and stay higher for longer.

The hawkish comments from Fed officials have also led market watchers to factor in at least three more rate hikes of a quarter of a percentage point each, starting this month.

Marvell Technology, Inc. (NASDAQ:MRVL) shares were down 7.2% after the semiconductor maker provided first quarter profit and revenue forecasts that fell short of analysts’ estimates.

Costco Wholesale Corp. (NASDAQ:COST) shares fell 3% after the big box retailer posted disappointing second quarter revenue. Inflation is forcing consumers to cut back on their discretionary spending.

Oil was mixed. Crude Oil WTI Futures was up 0.2% to $78.33 a barrel, while Brent Oil Futures was down 0.1% to $84.64 a barrel. Gold Futures was up 0.6% to $1850.

(C) Reuters.

By Peter Nurse

Investing.com — Stocks in focus in premarket trade on Friday, March 3rd. Please refresh for updates.

Tesla (NASDAQ:TSLA) stock rose 1.8% after data released Friday showed that the electric car manufacturer sold 74,402 China-made electric vehicles in February, up 12.6% from January, and 31.65% higher from a year earlier.

Dell Technologies (NYSE:DELL) stock fell 3.7% after the computer hardware maker offered up a soft FY24 outlook, overshadowing positive fourth quarter numbers and a hiked dividend.

Costco (NASDAQ:COST) stock fell 2.5% after the big box retailer posted disappointing second quarter revenue as consumers are limiting their spending on discretionary items because of the continued high inflation.

Zscaler (NASDAQ:ZS) stock fell 12% after the cloud security computer announced it planned to lay off around 3% of its workforce due to the difficult macroeconomic situation.

ChargePoint (NYSE:CHPT) stock fell 11.6% after the electric vehicle infrastructure maker reported a wider-than-expected quarterly loss, while sales also disappointed.

Marvell (NASDAQ:MRVL) stock fell 10.4% after the semiconductor company posted disappointing guidance for the fiscal first quarter, citing inventory corrections.

Hewlett Packard Enterprise (NYSE:HPE) stock rose 2.8% after the tech company raised its annual outlook after reporting fiscal first quarter revenue that topped estimates.

Procter & Gamble (NYSE:PG) stock rose 1% after JPMorgan upgraded its stance on the consumer goods company to ‘overweight’ from ‘neutral’, saying the company can generate superior earnings during an economic downturn.

C3.ai (NYSE:AI) stock rose 16% after the provider of artificial intelligence software posted better-than-expected quarterly results, with CEO Thomas Siebel seeing a “dramatic change” in sentiment.

(C) Reuters

By Geoffrey Smith

Investing.com — Central bank watchers get more than they bargain for as they tune in to Federal Reserve Governor Chris Waller’s latest warnings on inflation. Two-year bond yields are set for their highest weekly close since 2007. The ISM releases its non-manufacturing survey. Broadcom and Marvell offer starkly diverging views of the outlook for chipmakers, but VMWare and C3.AI surprise positively. Rajiv Jain rides to the rescue of Gautam Adani, and Russia’s armed forces claim they’re close to capturing the town of Bakhmut, the focal point of fighting in Ukraine for the last four months. Here’s what you need to know in financial markets on Friday, 4th March.

1. Fed’s Waller, Bostic warn on rate path

Benchmark 2-year U.S. bond yields are set for their highest weekly close in over 15 years, at the end of a week stamped by fears that inflation isn’t coming down as quickly as hoped.

Two Federal Reserve officials – Governor Chris Waller and Atlanta Fed President Raphael Bostic – said on Thursday that they’re open to raising rates by more than they previously thought would be necessary, pushing market expectations of the ‘terminal’ fed funds rate in this cycle ever closer to 5.5%.

Bostic stressed that he’s still in favor of “slow, steady” increases rather than reverting to hikes of 50 basis points. Waller’s prepared remarks indicated he still sees a terminal rate of between 5.1% and 5.4%, but would revise that higher if economic data continue to come in hotter than expected.

“Hotter than expected” was one way of describing Waller’s comments in general. The speech, which was due to be delivered remotely – ended up being canceled after one user’s device was hacked and used to broadcast pornography to the rest of the participants.

2. Mixed fortunes for chipmakers

Chipmakers Broadcom (NASDAQ:AVGO) and Marvell (NASDAQ:MRVL) offered starkly contrasting outlooks for the year ahead as the semiconductor industry grapples with a looming glut.

Broadcom stock edged up in premarket after it forecast a “soft landing” in the second half, cushioned by an order book that still looks amply stocked and by strong demand for chips powering the rapid expansion in artificial intelligence applications. That echoed with a strong outlook from C3.AI (NYSE:AI), which rose over 16% in premarket.

By contrast, Marvell Technologies stock fell nearly 9%, putting it on course to test a five-week low when it opens later, after the company forecast earnings in a range around 29c a share in the current quarter, around 30% below consensus.

3. Stocks set to extend rebound; ISM Non-manufacturing survey due

U.S. stock markets are set to extend their gains after rebounding on Thursday, putting them on course for a weekly gain that looked unlikely a couple of days ago.

By 06:45 ET (11:45 GMT), Dow Jones futures were up 62 points, or 0.2%, while S&P 500 futures were up 0.3% and Nasdaq 100 futures were up 0.4%, with Broadcom’s outlook giving support to most of the rest of the chipmaking sector. Solid reports from VMware (NYSE:VMW) and Hewlett Packard Enterprise (NYSE:HPE) also reassured as to the strength of business investment, although Dell (NYSE:DELL) and Zscaler (NASDAQ:ZS) both slumped after giving weak outlooks.

Early attention is likely to focus on the ISM’s non-manufacturing survey due at 10:00 ET, with the market on the lookout for any further evidence of ‘sticky’ inflation.

4. Rajiv Jain gives Adani some breathing space

Embattled Indian tycoon Gautam Adani got a shot in the arm, as GQG – a U.S.-based investment firm founded by Indian-born Rajiv Jain – injected $1.9 billion into various parts of his struggling empire.

The move was the biggest external vote of confidence in Adani’s group since it was hit by a short-selling report from Hindenburg Research, which accused it of using excessive debt and shell companies to inflate the value of its portfolio companies’ stocks.

Adani Enterprises (NS:ADEL), the group’s flagship holding company, rose nearly 17%, although it’s still down more than 50% year-to-date. Adani Ports and Special Economic Zone (NS:APSE) stock rose 10% and Adani Transmission (NS:ADAI) rose 5%.

5. Russians close in on Bakhmut

The battle for Bakhmut appeared to be nearing its end, as Russian forces claimed they had all but surrounded the town that has been the focal point of fighting in Ukraine for the last four months. Ukrainian authorities acknowledged that a bridge on the last serviceable road out of Bakhmut had been destroyed, further undermining the position of the remaining defenders.

The fall of Bakhmut would in theory allow Russia to resupply its forces further south in Ukraine more easily, making it harder for Ukraine to recapture the provinces that the Kremlin annexed last year. That in turn could provide a fresh test of U.S. and European resolve to continue supporting Kyiv.

Recent reports have suggested that France and Germany, in particular, have urged President Volodymyr Zelensky to consider peace talks – something that Zelensky and (at least in public) all of Ukraine’s western allies reject.

(C) Reuters.

By Oliver Gray

Investing.com – U.S. stock futures ticked lower during Thursday’s evening trade, after major benchmark indices posted a positive session on investor optimism of a pause on aggressive interest rate hikes from Federal Reserve policymakers.

By 6:40pm ET (11:40pm GMT) Dow Jones Futures and S&P 500 Futures were 0.1% lower, while Nasdaq 100 Futures dipped 0.2%.

In extended deals, Dell Technologies (NYSE:DELL) lost 3% after the company reported Q4 EPS of $1.80 versus $1.65 expected on revenues of $25 billion versus $23.51 billion expected.

Hewlett Packard Enterprise Co (NYSE:HPE) added 1.9% after reporting Q1 EPS of $0.63 versus $0.54 expected on revenues of $7.8 billion versus $7.44 billion expected. The company also forecasted Q2 2023 EPS of $0.44-$0.52 versus $0.47 expected, while revenues are forecasted to total $7.1-7.5 billion versus $7.04 billion expected.

ChargePoint Holdings Inc (NYSE:CHPT) dipped 13.6%, reporting Q4 losses of $0.23 versus $0.19 expected on revenues of $152.8 million versus $165.09 million.

Ahead in Friday’s trade, market participants will be focused on the Markit and ISM Services PMIs, as well as speeches from the Fed’s Logan the FOMC members Bostic and Bowman.

During Thursday’s session, the Dow Jones Industrial Average added 341.7 points or 1.1% to 33,003.6, the S&P 500 gained 29.9 points or 0.8% to 3,981.3 and the NASDAQ Composite lifted 83.5 points or 0.7% to 11,463.

On the bond markets, United States 10-Year rates were at fresh 4-month highs of 4.062%.