A good first quarter did not stop the sale of Meta Platforms shares

Yesterday's session on Wall Street was not very volatile and stock indices ended the session around the reference point. In after-hours trading, Meta Platforms shares dropped significantly (over 15%) despite good results for the first quarter. We received hawkish comments from the ECB and BoE. Today the market is waiting for the reading CBA from the USA for the first quarter.

Yesterday, the yields of 10-year German and British government bonds rose significantly. This is the result of, among others, words of Joachim Nagel - member of the Governing Council of the ECB and head of the Bundesbank. He expressed doubts about further interest rate cuts. He admitted that after the possible reduction in the cost of money by the ECB in June, further steps may not necessarily follow. Nagel is not yet fully convinced that inflation is on track. This means that the mid-year cut may only be a form of adjustment of monetary policy. In turn, the Bank of England's chief economist, Huw Pill, said he supported a relatively cautious approach to interest rate cuts and still expressed concerns about a further disinflationary path.

The report beat analysts' estimates

Yesterday, Wall Street was waiting for the results of Meta Platforms, the owner of the platform Facebook, Instagram and Whatsapp messenger. Shares fell more than 15 percent in after-hours trading. around the level of USD 419. Let us recall that the historical record was set at the beginning of April at around USD 530. The report for the last three months exceeded analysts' estimates. Profit increased by 117%. to USD 12,37 billion and revenues amounted to USD 36,46 billion, which gave an increase of 27%. The market had largely discounted the positive news earlier and the attention was focused on what was ahead.

Meta's revenue forecasts for the second quarter were slightly below expectations. On average, the company assumes that revenues will be around USD 37,75 billion, which is a result slightly worse than the estimate of USD 38,3 billion. The current declines should be treated as a downward correction, the prospects for the company are still very good, so the upward trend should not be destabilized.

Yesterday we received the Ifo index from European data, which increased to 89,4 points in April. with 87,9 points in March. This exceeded market expectations. Business prospects for the next six months improved (89,9 points) and the assessment of the current situation increased to 88,9 points. from 87,7 previously. The business climate has improved in major sectors. The euro did not react in any particular way to the data. EUR / USD exchange rate after setting the daily minimum at 1,0678, it returned to growth, approaching 1,0730 this morning. The upward correction that has been ongoing since April 16 is therefore continuing. The rate broke the internal Fibo retracement level of 38,2%. the last downward impulse.

Source: Łukasz Zembik, OANDA TMS Brokers