(ABM FN-Dow Jones) The Amsterdam stock exchange entered the weekend higher on Friday. The AEX rose 1.0 percent to a close of 887.44 points. On a weekly basis, the main index rose around half a percent.
On the last day of the week, the main index managed to tighten the April 10 record of almost 887 points. The AEX is therefore still below the intraday peak of 894.52 points on April 12.
Much attention was paid to the American jobs report on Friday. There was also plenty of attention for the current earnings season. Heavyweight Apple sold fewer iPhones, but the results were better than expected. The tech giant also announced a new purchasing program of no less than 110 billion dollars.
The US jobs report for April showed job growth of 175,000, an unemployment rate of 3.9 percent and annual wage growth of also 3.9 percent annually. The market expected job growth of 240,000, a stable unemployment rate of 3.8 percent and wage growth of 4.0 percent.
The disappointing job growth in April is not yet so alarming that the Fed will have to intervene soon. The central bank needs three to four more of these types of figures to be able to lower interest rates during the course of the year, market analyst Philip Marey of Rabobank told ABM Financial News on Friday.
“You see the construction and leisure sectors falling sharply compared to March. That should not actually be the case, given that the figures have been adjusted for seasonal effects. Wages are rising less strongly, but an increase of 3.9 percent is still clear to the Fed too high. The central bank prefers to see growth of 2 to 3 percent,” says Marey.
ING pointed out that if the US unemployment rate rises in September “to roughly 4.2 percent, the Fed could cut rates.”
Still, Fed Governor Michelle Bowman warned on Friday that as far as she is concerned, an interest rate increase is not off the table as long as inflation in the US remains high. Earlier this week, Fed Chairman Jerome Powell seemed to emphasize that the market did not have to fear an increase when making the interest rate decision.
The chance of an interest rate cut in June was less than 10 percent on Thursday. On Friday, that chance rose to 14 percent. The chance of an increase in July is now estimated at 36 percent and for September the chance is now 67 percent, according to CME’s FedWatch Tool.
On a macroeconomic level, further attention was paid to purchasing data from the United Kingdom and the United States. For example, the British services sector grew slightly faster in April than a provisional estimate showed, with an index reading of 55.0.
In the US the picture was mixed. S&P Global’s purchasing managers index showed a slight growth slowdown for April to 51.3, while ISM purchasing data pointed to an unexpected contraction in the American services sector. The index stood at 49.4 in April.
The euro/dollar was 0.5 percent higher at 1.0777 after the jobs report. The US ten-year yield fell to 4.53 percent on Friday after the jobs report, while the two-year Treasury yield fell to 4.82 percent. Earlier this week, short-term interest rates were still around 5.00 percent.
Oil prices fell further and appear to have lost around 6 percent on a weekly basis.
Risers and fallers
Among the main stocks, Universal Music Group did good business with a gain of 3.6 percent after opening the books. UMG recorded higher profit and turnover last quarter. Deutsche Bank increased the price target with an unchanged buy recommendation. UBS and Bank of America also increased the price target.
Semiconductor stocks, which were the worst on Thursday, managed to recover today. ASMI, ASML and Besi rose approximately 3 to more than 4 percent. Besi was therefore the leader in the main index.
Shell ended up at the bottom of the AEX on Friday, with a loss of 0.8 percent. Furthermore, losses were limited to half a percent or less for, for example, KPN and Unilever.
In the Midkap, Galapagos and Aperam fell 1.3 and 4.6 percent respectively after figures. Flow Traders led the AMX with a gain of almost 5 percent.
Aperam dipped into the red last quarter. ING spoke of a subdued quarter, with non-traditional activities able to offset the weakness in the core activities.
Galapagos has maintained cash burn for the current year, while R&D costs continued to increase in the first quarter of 2024.
Heijmans fell more than 5 percent in the AScX after an ex-dividend listing. Brunel won almost 4 percent after results. ING spoke of a strong quarter for Brunel. The volatile Vivoryon rose more than 7 percent.
BAM fell another 0.8 percent after the share price drop of almost 11 percent on Thursday, in response to the figures then. ING spoke on Friday of “not a very good start” to the year, but the buy recommendation was maintained. BAM also announced today a share buyback program, with which it will buy back more than 7 million ordinary shares.
Wall Street
Around the close in Amsterdam, the American stock markets were trading approximately 1.0 to 2.0 percent higher.
Source: ABM Financial News
ABM Financial News is a supplier of stock market news, video and data, both for real-time trading platforms and dealing rooms and for online and offline media publications. The information in this article is not intended as professional investment advice or as a recommendation to make certain investments.
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