US futures indicate a mixed open when the first trading day of the month begins in North America. This comes after Friday’s sell-off that saw the Nasdaq Composite Index have its worst month since 2008. Amazon led the decline with a 14 percent drop after providing a lower-than-expected revenue forecast for the current quarter. Meanwhile, the Dow and S&P 500 indexes are coming off their worst month since the pandemic’s early days in March 2020. The S&P/TSX Composite finished the day down 359.06 points, down 1.7 percent. Rising interest rates, the impact of inflation, monetary policy tightening and ongoing COVID-19 lockdowns in China are top of mind for investors as they now turn their attention to the US Federal Reserve’s policy announcement on Wednesday, where Chairman Jerome Powell is widely expected to raise The central bank’s main lending rate by half a percentage point.
Oil Trade Less, China Locks Weight on Economy
West Texas Intermediate price is trading lower on concerns that the world’s largest oil importer won’t need as much of the commodity due to ongoing shutdowns as it tries to curb the spread of COVID-19. China’s manufacturing activity shrank further to a six-month low in April, raising concerns about how severely global supply chains will be affected. A survey measuring activity in the construction and services sectors has also fallen significantly, falling far short of expectations and reaching its lowest level since February 2020. Apple warned only last week that its current quarter could take a hit between $4 billion and $8 billion due to to lockdowns in China as it looks to curb the spread of COVID-19.
The pleasure of buying Buffett
Warren Buffett boosted Berkshire Hathaway’s investment in oil giant Chevron and also acquired a 9.5 percent stake in Activision Blizzard, the company behind the popular games “Call of Duty” and “Candy Crush.” Those were just two of the recent investments the Oracle of Omaha shared with the tens of thousands of investors who attended the company’s annual meeting over the weekend to hear from him and his business partner Charlie Munger in person. The company has been on a buying spree since the beginning of the year as it spent about $50 billion on shares, bringing its cash available to $106 billion in the first quarter. The two men took questions on a variety of topics from the markets, cryptocurrency, and nuclear weapons.
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Releases / Notable Events
- Notable data: US ISM Manufacturing PMI, US construction spending
- Notable earnings: Cargojet, Nutrien, TMX Group, MEG Energy
- 1100: Privacy Commissioner Daniel Terrain will appear before the House of Commons Standing Committee on Access to Information, Privacy and Ethics to participate in its study on the use and impact of facial recognition technology
- 1200: The Calgary Real Estate Board released April home sales