US OPEN: Mixed moods on Wall Street

 

US indices are trading mixed today.  From one hand  investors welcomed the fact that China is willing to  waive off some tariffs on US imports. Market participants hope that the easing of business shutdowns caused by the pandemic would help the global economy to recover. China announced a new list of 79 US products including ores of rare earth metals, gold ores and silver ores for waivers from retaliatory tariffs. Also factory workers in Michigan returned to work and GM, Ford and Fiat Chrysler plan to  resume production on May 18th.

 

On the other side mood remained nonetheless cautious, amid lingering concerns that the rushed reopening of the U.S. economy may lead to a second wave of infections and lockdowns later in the year. Today's data showed U.S. consumer prices in April dropped by the most since comparable records began in 1957 amid the COVID-19 pandemic, as prices for apparel, motor vehicle insurance, airline fares, and lodging away from home all fell sharply.  Annual inflation rate in the US dropped to 0.3% in April of 2020 from 1.5% in previous month and below analysts’ expectations of 0.4%. It is the lowest inflation rate since October of 2015, mainly due to a 32% plunge in gasoline prices. US core consumer price inflation, which excludes volatile items such as food and energy, declined to 1.4 percent year-on-year in April from 2.1 percent in March and below market expectations of 1.7 percent. It was the lowest reading since April 2011.

 

The dollar index erased previous gains to trade around 99.76 on Tuesday after hitting a 2-week high of 100.445 earlier in the session.

Later on today, top U.S. health authorities will testify to a Senate committee looking into plans for lifting the nation's lockdown.

 

Novavax (NVAX.US)— stock soared after the vaccine company’s  announced that nonprofit Coalition for Epidemic Preparedness will investment of $384 million to advance the clinical development of its coronavirus vaccine. The company said the vaccine it’s working on “shows strong potential to have a positive impact on this global health crisis.” The company reported a loss of 58 cents per share on revenue of $3.4 million, while analysts expected a loss of 70 cents per share on revenue of $1.7 million.

Novavax (NVAX.US)  shares continue to move higher.  Price broke above 200 MA (red line) and is heading towards key resistance zone at $52.22 per share. Source: xStation5

Tesla (TSLA.US) has resumed production at its Fremont factory in defiance of local authorities. CEO Elon Musk tweeted about the restart, and asked that he be the only one arrested if officials decide to go that route.
JPMorgan (JPM.US) shares went  up 1.0% after Federal Reserve officials played down the possibility of the Fed cutting official interest rates below zero next year.

Tilray (TLRY.US) - shares dropped 5% in extended trading after the company reported its first-quarter earnings. The cannabis company’s revenue of $ 52.1 million, came in above market expectations. However Tilray reported a GAAP net loss of $ 1.73 per share and its adjusted EBITDA was a loss of $ 19.7 million.

Hertz (HTZ.US) – investors are concerned about company's ability to continue, as it tries to reduce costs and avoid defaulting on its debts. Company's CEO Kathryn Marinello announced that the company was doing everything it can to preserve liquidity.

Ingersoll-Rand (IR.US) earned 25 cents per share for the first quarter, 3 cents a share below market forecasts. Revenue came in a above market estimates. The acquisition of Ingersoll-Rand by Gardner Denver was completed on Feb. 29, with Gardner Denver assuming the Ingersoll-Rand name.