Global Market Overview

Fixed Income Market Overview

U.S. Treasury yields saw an uptick on Tuesday following the release of labor cost data surpassing expectations, with the 2-year Treasury yield rising 4 basis points to 5.012% and the 10-year yield climbing nearly 5 basis points to 4.659%. The employment cost index, indicating a 1.2% increase in wages for civilian workers in the first quarter, contributed to this movement. Analysts suggest  this data reinforces the absence of immediate Fed rate cuts, as the market anticipates insights from the ongoing Federal Reserve meeting regarding future interest rate policies amidst persistent inflation concerns and economic resilience. Expectations for rate cuts have shifted from June to September, aligning with evolving economic indicators. Eurozone data also showed  inflation in line with estimates and a 0.3% GDP growth in Q1 2024.

Treasury Department announces new Series I bond rate of 4.28% for the next six months.

Coca-Cola tops earnings estimates, hikes revenue outlook on higher prices.

Microsoft to invest $1.7 billion into AI infrastructure in Indonesia, CEO Satya Nadella says.

Volkswagen profit drops 20% in first quarter on lower sales.

Euro zone inflation steady at 2.4%, keeping June rate cut in play as economy returns to growth.

Major Indicies

Bonds

Futures & Commodities

Equity Market Overview

PayPal

PayPal reported a 9% increase in revenue to $7.7 billion for Q1 2024, surpassing analyst projections, but non-GAAP EPS fell short at $1.08. The company, known for its digital payment solutions  including Venmo, boasts over 426 million active accounts globally. Total payment volume surged to $403.86 billion, with GAAP net income rising by 12% to $888 million. Operating income also  saw a 17% increase to $1.168 billion, reflecting effective operational management. Operating margin improved to 15.2%, and cash flow from operations soared by 64% to $1.917 billion, highlighting  solid financial health. CEO Alex Chriss emphasized long-term growth strategies amidst challenges, including adjustments in strategic investments. PayPal remains cautious yet optimistic about future quarters, aiming to leverage core strengths in the competitive digital payments landscape.

Amazon

Amazon reported strong earnings and  revenue for the first quarter, driven by growth in advertising and cloud computing, with earnings per share at 98 cents and revenue at $143.3 billion, surpassing expectations. Operating income surged over 200% to $15.3 billion, with net income tripling to $10.4 billion. AWS revenue reached $25 billion, and advertising revenue was $11.8  billion, both exceeding expectations. The company anticipates continued profitability growth in the second quarter, with operating income expected to be $10 billion to $14 billion and revenue in the range of $144 billion to $149 billion. Despite layoffs and cost-cutting measures, Amazon’s advertising unit saw a 24% surge in sales, solidifying its position as a key profit driver in online advertising.

Advanced Micro Devices

Advanced Micro Devices (AMD) reported first-quarter earnings and sales slightly above Wall Street’s expectations, with earnings per share at 62 cents and revenue at $5.47 billion. Despite meeting forecasts and signaling growth in AI chip sales, shares fell 7% in extended trading. The company provided an in-line forecast for the current quarter, expecting around $5.7 billion in sales. AMD’s Data Center segment saw significant growth of 80% year-over-year to $2.3 billion, driven by sales of its MI300 series AI chips, which have seen over $1 billion in sales since their launch. However, AMD’s gaming segment declined 48% year-over-year due to lower chip sales for game consoles and PCs. The company’s client segment revenue surged 85% annually to $1.4 billion, indicating a recovery from the PC slump of the previous year.