The biggest loser turned out to be the London FTSE100, which after a session characterized by a sustained downtrend ended the day down 1.16%. The Swiss SMI session had a similar outcome, closing the day below the level, down 0.88%. The most important European index, the STOXX, fell 0.60%. The supply advantage was also evident in Madrid (IBEX35: -0.74%), Milan (FTSE MiB: -0.51%), Paris (CAC40: -0.39%) and Frankfurt (DAX: -0.31%). Against the European backdrop, the Warsaw market showed relative strength.
WIG up: Digital Polsat (+9.84%), Benefit Systems (+4.88%), Asbisu (+3.32%)
The biggest winner turned out to be the second tier of companies, but gains were also seen on other indices. Thanks in part to Digital Polsat (+9.84%), Benefit Systems (+4.88%) and Asbisu (+3.32%), the mWIG40 index closed in the green, stronger by 0.46%. The broad market WIG index strengthened by 0.12% over the session.
The WIG20 blue‑chip index and the smallest sWIG80 companies closed just above the level, respectively by 0.05% and 0.04%. On Wednesday investors sold bonds, which led to higher yields. Benchmark 10‑year Treasury yields rose by 4 basis points and remain at 5.800.
Undoubtedly the epicenter of midweek events was Wall Street, where first‑quarter reports showcased the most important U.S. companies. The broad market S&P500 index, despite an attempt to pull up in the final trading phase, ended the day slightly below the level (-0.04%).
The final minutes of trading helped the broad technology sector – the Nasdaq Composite index closed above the level, stronger by 0.04%.
Before the sell‑off, small companies (Russell2000: -0.60%) and industrials (DJIA: -0.57%) were not spared.
Strong results for Meta Platforms
Meta Platforms delivered very good results, beating forecasts both in earnings (EPS 10.44 USD vs consensus 6.73 USD) and revenue (56.31 bln USD vs consensus 55.6 bln USD). The most important information remains the advertising efficiency achieved thanks to high CAPEX spent in previous quarters (ad impressions rose 19%, and the average cost per ad rose 12%). Sentiment, however, dampened forecasts (inline), which were not sufficiently optimistic, leading to a decline in the share price of just under 4% in intraday trading.
In response to recent criticism, a very strong report also came from Microsoft, beating revenue (82.9 bln USD vs consensus 81.46 bln USD) and EPS (4.27 USD vs consensus 4.06 USD).
The most important segment remains the cloud business, which recorded a 40% increase. The company surprised investors with lower CAPEX of just under 32 bln USD (expected 35 bln USD) – cloud accelerates with lower spend, meaning higher business profitability.
The market optimistically read the results of Alphabet (+2% in intraday trading) and Amazon (+1.3%). A moderately positive market picture was also reinforced by the Qualcomm report, after which shares rose about 12%.
Morning view of Asian markets paints a pessimistic picture. Equity asset sell‑off continues in the weak India market since the beginning of the year – Sensex (-1.46%) and Nifty (-1.56%). Since the beginning of the year, Sensex has already lost 10.46%. After yesterday’s break, Japanese investors return to trading, removing risk from portfolios – at the time of comment Nikkei loses 1.12%, and Topix 1.27%.
Mixed sentiment is seen in China, where Hang Seng loses 1.17%, and the continental China Shanghai Composite index strengthens by 0.15%. Remaining near historical highs, the South Korean KOSPI slightly corrects (-0.80%). Yesterday, as expected, the Fed left rates unchanged at 3.50%–3.75%.
The decision was made with the strongest decade‑long split among decision‑makers (8 to 4 in favor of keeping rates), showing a lack of unanimity among FOMC members. The last time four members opposed the decision was in 1992. The overall tone of the meeting and the subsequent conference was hawkish. At the end of his term on May 15, Powell announced he would remain on the Board of Governors until the issue regarding the Federal Reserve’s headquarters renovation is clarified.
Today, later in the day, we will learn the ECB’s decision on euro‑zone interest rates. Oil price concerns are, of course, a worry, as the WTI contract (+6.95%) is priced at $110, and Brent (+6.08%) at $113 per barrel.
