Will Jerome put on his angry dove costume? Or a paternalistic hawk? A mixture of both? Financiers no longer really believe in a rate cut at the March 20 meeting, and they seem to have taken this in their stride. They are very divided on the May, June and July meetings. They will therefore be looking to see whether the Fed will unleash its first monetary easing before the summer or not. US economic indicators are robust and inflation seems under control, albeit still a little high. In terms of monetary tactics, the Federal Reserve has almost no interest in letting financial markets off the hook at present.

The ADP employment report, released today, showed that companies added 107,000 workers in January, down from 158,000 in December. This is below estimates of 150,000.

The month of January ends this evening and it was a pretty good one for most stock markets. However, it was a terrible month for China's stock market, which continued to plummet despite Beijing's measures to halt Hong Kong and Shanghai's slump.

Among the standouts, the Japanese market, which has gained over 7%. We also have indices with a strong technology component, such as the US Nasdaq 100 and the Dutch AEX. More defensive indices follow, such as the Swiss SMI and the Copenhagen OMX.

Technology and Japanese equities remain the most popular bets at the start of 2024. This was already the case last year. The more astute among you will no doubt add that it's been 15 years in the making for technology. It looks like it's going to continue.

Today, exactly 703 companies are releasing their results across the world, including the troubled aircraft manufacturer Boeing, Europe's most highly capitalized company Novo Nordisk, Korea's leading electronics company Samsung and the old Swiss laboratory Novartis. Mastercard, Thermo Fisher Scientific, Boston Scientific, Phillips 66 and Hess are also on today’s agenda.

Yesterday, we got results from Microsoft, Alphabet and Advanced Micro Devices. In the eyes of the market, the trio's results were poor. Microsoft beat expectations and its share price did virtually nothing following the announcement (the company generally publishes very well, but the market generally expects very, very well, hence a certain softness in the reception). It's more complicated for Alphabet and AMD, which fell by 6% after the session because the results were below analysts’ expectations. Futures on the Nasdaq are down 1% this morning as a result, while the S&P 500 is down 0.5%.

In China, the official January manufacturing PMI is a little lower than expected and still in contraction territory, at 49.2 points. Ugly. Chinese stock indices are well on their way to deepening their losses this morning. Elsewhere in the Asia-Pacific region, Tokyo and Sydney ended the month higher, as did Bombay. On the other hand, Seoul confirmed its difficult start to the year. Europe's leading indicators are hesitant amid a flurry of earnings reports.

Economic highlights of the day:

Today, we have French and German inflation estimates for January, the ADP employment report, Chicago PMI, DOE crude oil inventories and the FOMC rate decision. The full agenda is here.

The dollar is worth EUR 0.9211 and GBP 0.7870. The ounce of gold is little changed at USD 2040. Oil is stable, with North Sea Brent at USD 81.92 a barrel and US light crude WTI at USD 77.17. The yield on 10-year US debt falls to 4.02%. Bitcoin trades at USD 42,600.

In corporate news:

  • Microsoft reported quarterly results ahead of Wall Street expectations on Tuesday evening, as new artificial intelligence (AI) features helped attract consumers to the company's cloud computing services. The stock is down 1.5% in pre-market trading due to rising AI-related costs.
  • Alphabet on Tuesday evening reported advertising sales for the October-December period below Wall Street expectations, overshadowing the technology giant's efforts in artificial intelligence (AI) and cloud computing. The stock fell by 5.6% in pre-market trading.
  • Tesla is down 3.1% in pre-market trading after a Delaware judge overturned a record $56 billion compensation package for Elon Musk, the automaker's CEO, following a shareholder complaint.
  • Electronic Arts reported lower-than-expected quarterly bookings on Tuesday, as lower spending and increased competition affected demand for its game titles. The share price fell by 3% in after-hours trading.
  • Boeing has "a lot to prove" to regain the confidence of regulators and customers after the mid-air incident involving an Alaska Airlines 737 MAX, CEO Dave Calhoun acknowledged on Wednesday, adding that the aircraft manufacturer will "move forward cautiously" in the face of the "serious challenge" it faces. It did not provide financial forecasts for 2024, and said it posted a fourth-quarter adjusted loss per share of $0.47, compared with an adjusted loss of $1.75 per share a year ago. Sales rose by 10% to $22 billion. The share price is up slightly in pre-market trading.
  • Starbucks advanced 2.7% in premarket trading after the coffee chain reported lower-than-expected results for its fiscal first quarter.
  • Mondelez International reported a rise in fourth-quarter sales on Tuesday, but price increases weighed on demand, which declined in volume terms. The share lost 2.8% in pre-market trading.
  • Paramount Global jumped 21% in premarket trading as media tycoon Byron Allen submitted a $30 billion takeover bid, including debt, for the group, a statement to Reuters showed on Tuesday evening.
  • Walmart announced on Tuesday that it would proceed with a 3-for-1 stock split of its outstanding shares, as part of an ongoing review of optimal trading and spread levels. The stock gained 1.3% in pre-market trading.
  • Match, parent company of Tinder, announced Tuesday evening that it expected first-quarter sales to fall short of Wall Street expectations, as users of dating apps cut back on spending amid economic uncertainty.
  • Phillips 66 exceeded expectations on Wednesday for quarterly earnings, thanks to sustained demand for fuel and solid performances in its chemicals division.
  • Otis Worldwide - The elevator and escalator manufacturer reported slightly better-than-expected earnings on Wednesday, thanks to sustained demand for its maintenance and repair services.
  • Nasdaq, the company that manages the American stock exchange of the same name, plans to cut hundreds of jobs as part of the integration of software provider Adenza into its operations - an acquisition completed last year, Bloomberg reported on Tuesday, citing sources close to the matter.
  • Juniper Networks, which is to be acquired by Hewlett Packard Enterprise, published sales for the fourth quarter on Tuesday evening below market expectations, penalized in particular by weak customer spending in the cloud computing sector.
  • Skyworks Solutions, an Apple supplier, exceeded expectations for quarterly earnings on Tuesday evening, helped by a stabilization of its market and the growing use of 5G telecom technologies.
  • Thermo Fisher Scientific - The medical equipment manufacturer said Wednesday it expects full-year earnings to fall short of Wall Street expectations, due to a further decline in demand for its services used to manufacture therapeutics and vaccines.

Analyst recommendations:

  • Costar Group, Inc.: Zacks upgrades to neutral from underperform with a price target raised from USD 70 to USD 91.
  • Danaher Corporation: Nephron Research LLC upgrades to buy from hold with a price target raised from USD 215 to USD 275.
  • General Motors Company: Punto Research downgrades to hold from buy.
  • Johnson Controls International Plc: Deutsche Bank downgrades to hold from buy with a price target reduced from USD 65 to USD 60.
  • Mettler-Toledo International, Inc.: Zacks upgrades to neutral from underperform with a price target raised from USD 1037 to USD 1290.
  • Verizon Communications: Barclays downgrades to equalweight from overweight with a target price of USD 44.
  • Vertex Pharmaceuticals Incorporated: Baird downgrades to underperform from neutral with a target price of USD 325.
  • Advanced Micro Devices, Inc.: Citigroup maintains its buy recommendation and raises the target price from USD 136 to USD 192. JP Morgan maintains a neutral recommendation with a price target raised from USD 115 to USD 180.
  • Archer-Daniels-Midland Company: Morgan Stanley maintains its market weight recommendation and reduces the target price from USD 76 to USD 57.
  • Corning Incorporated: Barclays maintains its equalweight recommendation and raises the target price from USD 28 to USD 35.
  • Costar Group, Inc.: Zacks upgrades to neutral from underperform with a price target raised from USD 70 to USD 91.
  • Danaher Corporation: Nephron Research LLC upgrades to buy from hold with a price target raised from USD 215 to USD 275.
  • Fortinet, Inc.: Wedbush maintains its outperform rating and raises the target price from USD 55 to USD 75.
  • Intuitive Surgical, Inc.: Daiwa Securities maintains its outperform rating and raises the target price from USD 302 to USD 422.
  • Mettler-Toledo International, Inc.: Zacks upgrades to neutral from underperform with a price target raised from USD 1037 to USD 1290.
  • Microsoft Corporation: D.A. Davidson maintains its buy recommendation and raises the target price from USD 415 to USD 500.
  • Royal Caribbean Group: Susquehanna maintains a positive recommendation with a price target raised from USD 120 to USD 150.
  • Skyworks Solutions, Inc.: Wolfe Research maintains its outperform rating and raises the target price from USD 100 to USD 130.
  • Vertex Pharmaceuticals Incorporated: Goldman Sachs maintains its buy recommendation and raises the target price from USD 442 to USD 559.
  • Harbour Energy P: Goldman Sachs downgrades to sell from buy with a price target reduced from GBX 300 to GBX 260.
  • Antofagasta Plc: Citigroup maintains its buy recommendation and raises the target price from GBP 17 to GBP 21.
  • Manulife Financial Corporation: CIBC Capital Markets upgrades to neutral from underperform with a price target raised from CAD 28 to CAD 30.
  • Sun Life Financial Inc.: CIBC Capital Markets upgrades to outperform from neutral with a price target raised from CAD 73 to CAD 75.