Author: Reuters

(Reuters) -Home Depot forecast full-year results below analysts’ estimates on Tuesday, signaling that lackluster demand would continue to affect the company this year as people tighten spending on home remodeling amid sticky inflation.

The company’s shares fell more than 2% premarket, after it also reported a bigger-than-expected drop in fourth-quarter sales.

With food prices and borrowing costs still elevated, customers are limiting home-related spend to just repair and maintenance rather than undertaking larger renovations, resulting in weak demand for discretionary categories such as flooring, kitchen and furniture.

Even as demand for key items such as plumbing and hardware have held up, Placer.ai data showed foot traffic at Home Depot fell in the fourth quarter, with declines worsening toward the end of the reporting period.

Home Depot forecast comparable sales to decline about 1% for 2024, while analysts expected a marginal rise of 0.06%, according to LSEG data.

“There was an expectation from the market that the company could return to growth sooner than they’re guiding to,” said Jonathan Reid, a director at Fitch Ratings covering the retail and consumer goods industries.

While the home-improvement industry is expected to recover in the second half of the year, analysts believe Home Depot will continue to experience near-term pressure.

Transactions at the retailer fell 1.7% in the fourth quarter, logging their eleventh straight quarterly decline.

The company forecast 2024 per-share earnings to grow about 1%, compared to analysts’ expectations of a 3.62% rise to $15.61.

Comparable sales fell 3.5% in the fourth quarter, versus estimates of a 3.3% drop, but a tighter lid on costs and easing supply chain expenses helped Home Depot post a per-share profit of $2.82, beating estimates of $2.77.

(Reporting by Granth Vanaik and Deborah Sophia in Bengaluru; Editing by Shounak Dasgupta)

(Reuters) -Data provider S&P Global said on Tuesday it plans to buy financial technology provider Visible Alpha for an undisclosed sum.

Founded in 2015, Visible Alpha is a financial technology firm that provides consensus estimates and analytics, and distributes the data through channels including a web-based platform and feeds.

S&P Global is also exploring options for its digital solutions provider Fincentric, formerly known as Markit Digital, the company said in a statement.

The deal for Visible Alpha, expected to close this year, and the consideration of options for Fincentric are part of measures to accelerate focus in key areas of strategic growth, S&P said.

(Reporting by Mehnaz Yasmin in Bengaluru; Editing by Devika Syamnath)

By Noel Randewich

(Reuters) – Chipmaker Nvidia is replacing Tesla as Wall Street’s most traded stock, adding to its prominence after becoming the third-most valuable U.S. company and showing more evidence of how central AI-related bets have become to investors.

Nvidia’s outsized representation in day-to-day stock trading could leave investors more vulnerable should the chipmaker’s revenue growth fail to meet investors’ high expectations and puncture a Wall Street rally that has been fueled by euphoria about artificial intelligence.

The Santa Clara, California chipmaker’s quarterly report on Wednesday will be one of Wall Street’s most watched events of the week. Some strategists believe anything short of a blowout report could reverse a rally that has sent Nvidia’s stock soaring 47% in 2024.

About $30 billion worth of Nvidia shares changed hands daily on average over the past 30 sessions, pulling ahead of Elon Musk’s electric car maker, which averaged $22 billion per day over the same period.

Tesla since 2020 had dominated daily U.S. stock trading, according to LSEG data, with turnover — a stock’s share price multiplied by the number of shares exchanged — peaking above $35 billion several times in recent years.

On Friday, combined trading in Nvidia and Super Micro Computer, another company benefiting from the boom in AI, accounted for over 40% of all turnover of the 10 most traded U.S. stocks, including Tesla, Meta Platforms, Apple, Amazon and Microsoft.

“There’s an argument here that this is the dawn of a new era of trading, like the dawn of the internet, with Nvidia in the pole position,” said Dennis Dick, a trader at Triple D Trading in Ontario, Canada.

But Dick also warned that sky-high turnover in AI-related stocks suggests retail investors and algorithmic traders are driving share prices higher based on momentum rather than fundamentals, such as expectations of future revenue growth.

Super Micro, which sells AI-related server components to Nvidia, has seen its value more than triple to $45 billion so far in 2024. It tumbled 20% from record highs on Friday after Wells Fargo started covering the stock with an equal weight rating, saying its valuation already discounts “solid upside”.

Nvidia controls about 80% of the high-end AI chip market, and last week its market capitalization eclipsed, separately, Amazon’s and Alphabet’s to make it Wall Street’s third-most valuable company, behind Microsoft and Apple. Nvidia’s stock market value has surged to $1.8 trillion from $540 billion a year ago.

Meanwhile, Tesla’s stock has tumbled 20% so far in 2024 as it struggles with tepid demand for its electric cars and growing competition.

(Reporting by Noel Randewich; Editing by Cynthia Osterman)

BEIJING/SHANGHAI (Reuters) -China’s securities watchdog said it held a series of seminars on Sunday and Monday with market participants who proposed tighter scrutiny of company listings and trading behaviour as part of efforts to revive market confidence.

The meetings were led by the watchdog’s newly-installed chairman Wu Qing and held immediately after the week-long Lunar New Year holiday, reflecting the urgency to stabilize a market that dropped to five-year lows early this month.

Participants, including small investors, listed companies, money managers and accounting firms, said regulators should tighten screws on initial public offerings and weed out listed companies that do not qualify.

They also proposed a fairer trading mechanism and harsher punishment for law breakers, the China Securities Regulatory Commission (CSRC) said in a statement.

The watchdog said it would treat all proposals seriously and implement feasible ones immediately, reiterating its intention to “resolutely maintain market stability and control market risks.”

“Confidence is more precious than gold,” the official China Securities Journal said in an editorial on Tuesday.

Improved communication with the market can help rebuild confidence, and “we believe that careful listening is a good start.”

Wu, nicknamed the “broker butcher” after an earlier regulatory stint, was appointed CSRC chairman on February 7. He replaced Yi Huiman, who had failed to arrest share price slides despite a slew of measures designed to stabilise the market.

Just two days after Wu’s appointment, the watchdog punished employees at China Merchant Securities for illegal stock trading and fined Shanghai-based semiconductor company S2C Ltd for fraud in its listing application.

The CSRC plans to strengthen cooperation with law enforcement agencies to crack down on securities cheating and financial manipulation, the China Securities Journal said.

The regulator will also speed up registration of equity funds, and guide more long-term capital into the stock market, the newspaper said.

(Reporting by Shanghai newsroom; editing by Christina Fincher)

By Alexander Hübner and Emma-Victoria Farr

MUNICH (Reuters) -Munich is starting to steal some of German financial hub Frankfurt’s limelight as foreign banks flock to the southern city, which on a clear day has views of the Bavarian Alps.

The appeal lies in Munich’s high proportion of DAX companies and tech start-ups, large insurers and financial investors, while the nearby mountains add to its allure.

Firms such as Goldman Sachs and Morgan Stanley have been drawn by big German companies such as Siemens, Allianz and BMW being based around Munich, while their bankers also value the quality of life on offer.

“Many decision-makers work and live here, it’s a city where you can live well,” said Dietrich Becker, head of Europe and partner at Perella Weinberg, adding that Munich had the highest concentration of clients in Germany.

The U.S. investment banking boutique was a pioneer in choosing Munich for its German base, opening its office in 2020.

“In London and Paris there is a high concentration of companies and decision-makers, in Germany that is more spread out, people are constantly on the move,” Becker told Reuters.

Along with big established industrial and financial names, EQT and General Atlantic are among the largest technology investors present in Munich.

And there are also aspiring German software companies and many European subsidiaries of U.S. technology firms.

Next month, Goldman Sachs will be the first of the major investment banks to establish a presence in the Bavarian state capital when it opens a Munich office.

This will be Goldman’s second office in Germany after Frankfurt, where it has around 400 bankers, with its Wall Street rival Morgan Stanley set to follow suit in the summer. “We will be in Munich with a team of around 30 bankers, some of whom will move from Frankfurt but also some from London,” Wolfgang Fink, head of Germany and Austria and chairman of continental Europe at Goldman Sachs, told Reuters.

“We want to be where our clients are,” said Fink, adding that Munich was becoming “more and more international”.

TECH TEAMS

In the German tech sector, Goldman Sachs and Morgan Stanley are among some of the most sought-after investment banking advisers, alongside fellow U.S. giant JP Morgan.

“In terms of market value, there are around one third of DAX companies sitting here and more than ten ‘unicorns’, i.e. start-ups with a valuation of more than one billion euros,” said Tammo Buennemeyer, a technology specialist who will help establish Morgan Stanley’s team in Munich.

Goldman Sachs, meanwhile, says it will move the team of Tobias Koester, which covers financial investors, alongside its technology, telecom and media bankers (TMT) under Macario Prieto, head of TMT banking EMEA.

“In the long term, this regionalisation is also a result of Brexit, after which more business moved to the continent for regulatory reasons,” said Fink.

Frankfurt, Paris and Amsterdam fought to be the largest beneficiary from Brexit after Britain left the European Union, with Munich proving to be an unexpected beneficiary.

“The European continent as a whole has gained importance due to Brexit,” said Buennemeyer.

Perella Weinberg partners Stefan Jentzsch and Johann von Wersebe are based in Munich, while former Deutsche Bank CFO Marcus Schenck moved from the advisory boutique to Lazard two years ago, but stayed in Munich.

And another U.S. investment banking boutique, PJT Partners plans to open an office in Munich soon, people with knowledge of the matter told Reuters.

Most bankers agree, however, that Munich is unlikely to rival the more internationally-open Frankfurt as Germany’s banking capital, with only a fraction of them employed in the Bavarian state capital for now.

“Viewed from other European countries, Munich is certainly attractive,” said Fink. “But at the start of a career, many colleagues feel at home quickly in Frankfurt.”

(Reporting by Alexander Huebner and Emma-Victoria Farr; Editing by Alexander Smith)

BOGOTA (Reuters) – Colombia’s financial regulator on Monday suspended trading of shares in food producer Nutresa, ahead of a planned public offer of shares launched by Grupo Gilinski, Nutresa’s current majority shareholder.

After several years of tense corporate wrangling, Grupo Gilinski agreed to exit its stake in the country’s largest investment firm Grupo Sura and take at least an 87% stake in Nutresa.

Gilinski along with its partner, IHC Capital Holding LLC, currently controls 76.9% of Nutresa.

The public offer will be for as many as all of Nutresa’s remaining shares, the regulator said in a statement, and trading is suspended until the day after the public announcement of the offer.

The purchase price for shares in Nutresa under the offer will be $12, the statement said. Shares in Nutresa closed at 46,700 pesos ($11.95) on Friday.

Neither Grupo Gilinski nor Nutresa, which operates in 14 countries and produces coffee, chocolates, pasta, ice creams and includes a chain of restaurants, responded to requests for comment.

(Reporting by Nelson Bocanegra; Writing by Julia Symmes Cobb; Editing by Sandra Maler)

By Alexander Hübner and Emma-Victoria Farr

MUNICH (Reuters) – Munich is starting to steal some of German financial hub Frankfurt’s limelight as foreign banks flock to the southern city, which on a clear day has views of the Bavarian Alps.

The appeal lies in Munich’s high proportion of DAX companies and tech start-ups, large insurers and financial investors, while the nearby mountains add to its allure.

Firms such as Goldman Sachs and Morgan Stanley have been drawn by big German companies such as Siemens, Allianz and BMW being based around Munich, while their bankers also value the quality of life on offer.

“Many decision-makers work and live here, it’s a city where you can live well,” said Dietrich Becker, head of Europe and partner at Perella Weinberg, adding that Munich had the highest concentration of clients in Germany.

The U.S. investment banking boutique was a pioneer in choosing Munich for its German base, opening its office in 2020.

“In London and Paris there is a high concentration of companies and decision-makers, in Germany that is more spread out, people are constantly on the move,” Becker told Reuters.

Along with big established industrial and financial names, EQT and General Atlantic are among the largest technology investors present in Munich.

And there are also aspiring German software companies and many European subsidiaries of U.S. technology firms.

Next month, Goldman Sachs will be the first of the major investment banks to establish a presence in the Bavarian state capital when it opens a Munich office.

This will be Goldman’s second office in Germany after Frankfurt, where it has around 400 bankers, with its Wall Street rival Morgan Stanley set to follow suit in the summer. “We will be in Munich with a team of around 30 bankers, some of whom will move from Frankfurt but also some from London,” Wolfgang Fink, head of Germany and Austria and chairman of continental Europe at Goldman Sachs, told Reuters.

“We want to be where our clients are,” said Fink, adding that Munich was becoming “more and more international”.

TECH TEAMS

In the German tech sector, Goldman Sachs and Morgan Stanley are among some of the most sought-after investment banking advisers, alongside fellow U.S. giant JP Morgan.

“In terms of market value, there are around one third of DAX companies sitting here and more than ten ‘unicorns’, i.e. start-ups with a valuation of more than one billion euros,” said Tammo Buennemeyer, a technology specialist who will help establish Morgan Stanley’s team in Munich.

Goldman Sachs, meanwhile, says it will move the team of Tobias Koester, which covers financial investors, alongside its technology, telecom and media bankers (TMT) under Macario Prieto, head of TMT banking EMEA.

“In the long term, this regionalisation is also a result of Brexit, after which more business moved to the continent for regulatory reasons,” said Fink.

Frankfurt, Paris and Amsterdam fought to be the largest beneficiary from Brexit after Britain left the European Union, with Munich proving to be an unexpected beneficiary.

“The European continent as a whole has gained importance due to Brexit,” said Buennemeyer.

Perella Weinberg partners Stefan Jentzsch and Johann von Wersebe are based in Munich, while former Deutsche Bank CFO Marcus Schenck moved from the advisory boutique to Lazard two years ago, but stayed in Munich.

And another U.S. investment banking boutique, PJT Partners plans to open an office in Munich soon, people with knowledge of the matter told Reuters.

Most bankers agree, however, that Munich is unlikely to rival the more internationally-open Frankfurt as Germany’s banking capital, with only a fraction of them employed in the Bavarian state capital for now.

“Viewed from other European countries, Munich is certainly attractive,” said Fink. “But at the start of a career, many colleagues feel at home quickly in Frankfurt.”

(Reporting by Alexander Huebner and Emma-Victoria Farr; Editing by Alexander Smith)

By Harry Robertson and Ankur Banerjee

LONDON/SINGAPORE (Reuters) -The dollar inched higher on Monday after rising for the fifth week straight on the back of strong inflation data, while the yen traded near the psychologically important 150 level.

U.S. markets are closed for the Presidents’ Day holiday, with trading volumes likely to be low throughout the day.

The dollar index, which tracks the currency against six peers, was last up 0.13% at 104.35, after rising 0.18% the previous week.

It rose to its highest since mid-November last Tuesday to 104.97 after figures showed U.S. inflation came in stronger than expected in January, causing investors to dial down the number of interest rate cuts they expect from the Federal Reserve this year. But it slipped on Thursday after data showed retail sales fell last month.

“In theory last week should have been a good week for the dollar, but the dollar didn’t really hold on to its gains,” Chris Turner, global head of markets at ING, said.

“Are we getting near to the point where the pricing in the Fed cycle is about right?”

The euro was down 0.12% at $1.0763, after falling to a three-month low of $1.0695 last week. Sterling was unchanged at $1.2595.

Survey-based purchasing managers’ index data, released on Thursday, will give a sense of the health of the euro zone and UK economies in February.

The minutes from the Fed’s last meeting, due on Wednesday, are likely to be the main release for investors this week.

Investors expect around 90 basis points of Fed rate cuts this year, according to money market pricing, down sharply from around 145 basis points at the start of February.

The dollar slipped 0.1% against the yen on Monday, taking it to 150.08 yen.

It remains around 6% higher against the yen this year as Japan has kept its ultra-loose monetary policy in place. That has created a wide gap between the two countries’ bond yields which has boosted the attractiveness of the dollar.

The rally has prompted speculation among investors that the Japanese authorities could intervene to boost their currency.

Finance Minister Shunichi Suzuki last week warned that “rapid moves are undesirable for the economy”.

Weekly data from the U.S. markets regulator showed speculators again increased their net short position against the yen, taking it to a more than two-month high worth $9.2 billion.

China’s onshore yuan barely budged as investors returned from the week-long Lunar New Year break, despite tourism revenues surging during the holiday. It last changed hands for around 7.1987 per dollar.

(Reporting by Harry Robertson in London and Ankur Banerjee in Singapore, Editing by Shri Navaratnam, Ed Osmond, Andrew Heavens, Peter Graff)

BEIJING/SHANGHAI (Reuters) – China’s securities watchdog said it held a series of seminars on Sunday and Monday with market participants who proposed tighter scrutiny of company listings and trading behaviour as part of efforts to revive market confidence.

The meetings were led by the watchdog’s newly-installed chairman Wu Qing and held immediately after the week-long Lunar New Year holiday, reflecting the urgency to stabilize a market that dropped to five-year lows early this month.

Participants, including small investors, listed companies, money managers and accounting firms, said regulators should tighten screws on initial public offerings and weed out listed companies that do not qualify.

They also proposed a fairer trading mechanism and harsher punishment for law breakers, the China Securities Regulatory Commission (CSRC) said in a statement.

The watchdog said it would treat all proposals seriously and implement feasible ones immediately, reiterating its intention to “resolutely maintain market stability and control market risks.”

Wu, nicknamed the “broker butcher” after an earlier regulatory stint, was appointed CSRC chairman on February 7. He replaced Yi Huiman, who had failed to arrest share price slides despite a slew of measures designed to stabilise the market.

Just two days after Wu’s appointment, the watchdog punished employees at China Merchant Securities for illegal stock trading and fined Shanghai-based semiconductor company S2C Ltd for fraud in its listing application.

(Reporting by Shanghai newsroom; editing by Christina Fincher)

By Carolina Mandl, Amruta Khandekar and Ankika Biswas

(Reuters) -U.S. stocks fell on Friday with the Nasdaq showing the largest decline after a hotter-than-expected producer prices report eroded hopes for imminent interest rate cuts by the Federal Reserve.

A Labor Department report showed producer prices increased more than expected in January, feeding fears inflation was picking up after months of cooling. After five consecutive weeks of gains, all three indexes posted a weekly decline.

The data could encourage the Fed to wait before cutting rates. Earlier this week, a hot consumer prices report sparked a selloff in equity markets although a slump in January retail sales on Thursday stoked hopes of rate cuts.

“The inflation data this week are definitely going to keep the Fed at least on pause until summer,” said Carol Schleif, chief investment officer at BMO family office. “Data is bumpy, it’s not a straight line.”

Treasury yields spiked after the report as traders added to bets the Fed may defer the first rate cut until after June.

“The theme of higher for longer is really the continuing market narrative” for interest rates, said Greg Bassuk, Chief Executive Officer at AXS Investments.

Two Fed officials expressed caution. Atlanta Fed President Raphael Bostic said he needed more evidence inflation pressures are easing, but is open to lowering rates at some point in the next few months. San Francisco Fed President Mary Daly said “there is more work to do” to ensure stable prices, despite remarkable progress.

The S&P 500 lost 24.18 points, or 0.49%, to end at 5,005.15 points, while the Nasdaq Composite lost 132.38 points, or 0.83%, to 15,775.65. The Dow Jones Industrial Average fell 149.48 points, or 0.39%, to 38,623.64.

Most megacap stocks dropped, with Meta Platforms falling 2.2% and dragging the S&P 500 communication services index down 1.56%.

The S&P 500 closed above 5,000 for the fourth time this year thanks to robust corporate earnings and surging enthusiasm around artificial intelligence.

Applied Materials jumped 6.4% after the semiconductor equipment supplier forecast better-than-expected second-quarter revenue on strong demand for advanced chips used in AI.

Vulcan Materials gained 5,2% after forecasting a higher full-year profit, aiding a rise in the S&P 500 materials sector index.

Roku slumped 23.8% after forecasting a bigger first-quarter loss, while crypto exchange Coinbase Global jumped 8.8% on posting its first quarterly profit since 2021.

DoorDash dropped 8.1% as the delivery firm forecast a quarterly profitability metric below expectations, hurt by higher labor costs.

Declining issues outnumbered advancers by a 1.7-to-1 ratio on the NYSE, while on Nasdaq declining issues outnumbered advancers by a 1.6-to-1 ratio.

The S&P 500 posted 63 new 52-week highs and 3 new lows while the Nasdaq recorded 225 new highs and 66 new lows.

On U.S. exchanges 11.18 billion shares changed hands compared with the 11.65 billion moving average for the last 20 sessions.

(Reporting by Carolina Mandl, in New York, Amruta Khandekar and Ankika Biswas in Bengaluru; Editing by Maju Samuel, Chizu Nomiyama and David Gregorio)