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Nasdaq Gains on News of Microsoft Closer to Acquiring Activision Blizzard

Miguel A. Rodriguez
Miguel A. Rodriguez
18 July 2023

North American Indices see slight rise as a number of reports from the earnings season have beaten expectations so far. The best performance was seen from the Nasdaq index after the acquisition deal between Microsoft and Activision Blizzard takes another step forward.

Earnings Season: Beating Estimates So Far

Prior to a hectic week of earnings reporting, US markets started the week on a stronger note.  

Two of the major North American banks, Bank of America and Morgan Stanley, will release their Q2 earnings results today. Major corporations and financial institutions like Goldman Sachs, Tesla, Inc., and Netflix will present their financial results this week.  

Last week ended with the news of the earnings per share and income of JP Morgan, Wells Fargo and Citigroup. The numbers for all three of these banks exceeded forecasts.

So far, the earnings season has been successful, exceeding market analysts' predictions. In fact, about 80% of the 30 S&P 500 businesses that have released earnings so far have surpassed forecasts.

Positive data has given rise to North American indices

While awaiting the release of the results this week, these encouraging indicators have so far given the North American indices a small upward boost.  

Although the June consumer price index and producer price reports showed prices cooling quicker than anticipated, stocks had already been gaining since last week, encouraging anticipation that the Federal Reserve could cease its interest rate hikes sooner rather than later.  

Retail sales are another set of data that will be released this week and used to determine the strength of domestic demand in the United States.

Nasdaq index surges by nearly 1%

With gains of close to 1%, the Nasdaq index had the strongest performance yesterday. This was due to improved merger possibilities for technology businesses following news that Microsoft (MSFT) is one step closer to acquiring Activision Blizzard, an American video game holding company.

Wheat reacts to news of Russia blocking Ukraine’s exit of the commodity

In the commodities market, wheat had a highly volatile day after it was revealed that Russia had declined to extend the arrangement allowing Ukrainian wheat to exit through the Black Sea.

Although it later dropped while waiting for confirmation of the agreement's termination, the price of wheat reached $688, its highest level since April, even though the negotiations are still ongoing.

DMO 18.07.2023 graph.png

Wheat monthly graph. Sources: Bloomberg, Reuters 

Key Takeaways

  • JP Morgan, Wells Fargo and Citigroup earnings reports beat expectations
  • Bank of America and Morgan Stanley to release Q2 earnings results today
  • Goldman Sachs, Tesla, Inc., and Netflix to present financial results this week
  • Around 80% of the 30 S&P 500 businesses that have released earnings so far have surpassed forecasts
  • North American indices saw a small upward boost on positive earnings
  • Nasdaq index gains almost 1% on news that Microsoft is closer to acquiring Activision Blizzard.
  • Wheat gained and then dipped on news that Russia did not extend privileges to Ukraine to move wheat through the Black Sea

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Miguel A. Rodriguez
Miguel A. Rodriguez
Financial Writer

Miguel worked for major financial institutions such as Banco Santander, and Banco Central-Hispano. He is a published author of currency trading books.