Weekly Market Update - 2 May 2022

Exxon Mobil Q1 Profit Surgee

Exxon Mobil has reported a net income of $5.48bn for the first quarter of 2022, more than double compared with $2.7bn a year ago, driven mainly by higher oil and gas prices.

The company’s profit surges despite the fact that the firm took a hit of $3.4bn from its withdrawal of operations from Russia, including exit from the Sakhalin-1 project. The company’s revenue stood at $90.5bn for the quarter ended 31 March 2022 as against $59.14bn in the year ago period. First-quarter capital and exploration expenditures stood at $4.9bn while cash flow from operating activities was $14.8bn. Free cash flow for Q1 was around $11bn.

Source: Offshore Technology

U.S. Gross Domestic Product Fell In The First Quarter

The decline in GDP at a 1.4% annual rate marked a sharp reversal from a 6.9% annual growth rate in the fourth quarter. The drop stemmed from a widening trade deficit and masked underlying strength in consumer and business spending. A slower pace of inventory investment by businesses and fading government stimulus spending also pushed growth down.

Consumer spending rose at a 2.7% annual rate in the first quarter, a slight acceleration from the end of last year. A Commerce Department report today on consumption and inflation in March is set to show that spending accelerated last month too, as rising wages propelled Americans to dine out and travel more. Higher wage and benefits costs, however, are among the factors companies say are leading them to raise prices on goods and services. The Labor Department will report today on labor costs in the first quarter.

Source: WSJ

Tech Stocks Leading A Charge

Meta Platforms rose 18% after it beat investors’ expectations for user growth in the first quarter. That gain helped send the Nasdaq Composite up 3.1% and boosted the S&P 500 technology sector, which was the best performing group in the index. The S&P 500 climbed 2.5% and the Dow industrials 1.8%.

Apple edged up as much as 3.9% in after-hours trading after posting stronger-than-expected earnings and revenue, and CEO Tim Cook said supply constraints were lower than in the December quarter. But today may bring a quick reversal to the tech sector’s gains if after-hours and premarket trading are any indication. Intel shed up to 6.8% after hours as it reported weaker demand for personal computers. Amazon fell 8.5% in premarket trading after the company posted its first quarterly loss since 2015 as revenue growth slowed significantly. In oil markets, benchmark Brent crude rose 2.2%. Chevron and Exxon are among the first big oil companies to report earnings today.

Source: WSJ