Wall Street Today | Surging U.S. share buybacks offer support to sputtering market

Moomoo Recap US wrote a column · Feb 20, 2022 18:01

Wall Street Today | Surging U.S. share buybacks offer support to sputtering market

U.S. futures drop, Bonds climb on Ukraine risks

U.S. equity futures declined Monday and Asian stocks looked set to fall amid deepening geopolitical concerns and growing calls from Federal Reserve officials for higher interest rates to fight inflation.

$NASDAQ 100 Index(.NDX.US)$ contracts were down about 1%, while those for the $S&P 500 Index(.SPX.US)$ were also in the red. Australian equities and futures for Japan and Hong Kong all slipped. U.S. markets are shut for a holiday Monday.

JPMorgan expects string of nine straight Fed rate hikes

$JPMorgan(JPM.US)$ economists said the Federal Reserve is likely to raise interest rates by 25 basis points at nine consecutive meetings in a bid to tamp down inflation.

The bank is joining others on Wall Street in ramping up bets for faster policy tightening, after U.S. consumer prices posted the biggest jump since 1982 in January. $Goldman Sachs(GS.US)$ is forecasting 7 hikes this year, up from its earlier prediction of five.

Surging U.S. share buybacks offer support to sputtering market

The 10 biggest repurchases for S&P 500 Index companies last quarter totaled $86 billion, up almost 30% from a year earlier, led by $Apple(AAPL.US)$, $Meta Platforms(FB.US)$ and $Alphabet-A(GOOGL.US)$, data compiled by Bloomberg show.

Buybacks are surging as companies tap cash hoards amassed during the pandemic. While some investors argue the funds are better spent on the businesses, many cheer the efforts to boost per-share earnings and potentially stock prices. The trend is expected to continue in 2022, providing a market tailwind with stocks sputtering below all-time highs.

Biden abruptly cancels Delaware trip after top level meeting on Ukraine crisis

President Joe Biden abruptly canceled plans on Sunday to go to his home in Delaware for the holiday following a two-hour meeting of his national security team to discuss the Russian threat to Ukraine. It's unusual for a U.S. president's travel plans to change this quickly, especially plans that involve leaving Washington.

Biden's movements took on a new significance this weekend after the president said he believed Russian President Vladimir Putin had decided to carry out an attack on Ukraine "in the coming days."

Trump's Truth Social app set for Monday release in Apple App Store

Donald Trump's new social media venture, Truth Social, appears set to launch in Apple's App Store on Monday, according to posts from an executive on a test version viewed by Reuters.

The launch would restore Trump's presence on social media more than a year after he was banned from Twitter, Facebook and Alphabet's YouTube.

Vitol CEO sees oil above $100 for a 'prolonged period' this year

Oil prices could be set for a "prolonged period" above $100 a barrel over the next six to nine months, with the world setting fresh demand records this year, said Vitol Group CEO Russell Hardy.

Crude already surged to within a few dollars of that level earlier this month, as the recovery in fuel use from the pandemic started to run into supply constraints. In an interview in London with Bloomberg television, the boss of the world's largest independent oil trader said the market will get tighter, with daily consumption set to rise well above pre-Covid levels by the end of 2022.

Big Oil on course for near-record $38bn in share buybacks

Western energy majors are on course to buy back shares at near record levels this year as soaring oil and gas prices enable them to deliver bumper profits and boost returns for investors. The seven supermajors — including $BP PLC(BP.US)$, $Shell PLC(SHEL.US)$, $Exxon Mobil(XOM.US)$ and $Chevron(CVX.US)$ — are poised to return $38bn to shareholders through buyback programmes this year, according to data from Bernstein Research.

Investment bank RBC Capital Markets puts the total figure higher at $41bn. That would be almost double the $21bn in buybacks completed in 2014 — when oil last traded above $100 a barrel — and the biggest total since 2008.

Elon Musk donated $5.7 billion of Tesla shares to charity

Elon Musk gifted almost $6 billion worth of $Tesla(TSLA.US)$ stock to charity late last November in one of the largest philanthropic donations in history.

In the weeks leading up to the gift, Musk suggested he'd sell stock if the United Nations proved $6 billion would help solve world hunger, after the head of the organization's World Food Programme called for billionaires like Musk to "step up."

Source: Bloomberg, CNBC

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