Before the bell: Markets on the move on Assumption Day

It may be Assumption Day, but that doesn’t mean Spaarvarkens.be is taking a holiday. The Belgian stock exchange is open as usual. In Europe yesterday, defence stocks such as Rheinmetall (+2.8%) were in demand. Today, Trump and Putin meet to discuss a ceasefire in Ukraine, although both have downplayed expectations for the meeting. In the US, the standout was the sharp rise in producer prices in July, which increased by 0.9% compared to the 0.2% expected. Consumers have not yet been hit with higher prices, but companies have. The impact on the S&P 500 and Nasdaq was limited, with both ending the day almost unchanged. Crypto platform Bullish surged another 10% after an +84% market debut the day before, buoyed by positive sentiment around cryptocurrency companies in the US. Cisco fell 1.6% despite better-than-expected results, as uncertainty over the outlook weighed on the stock. Intel gained 7.4% on reports that the US government may take a stake in the chipmaker.

This morning, the Chinese market is trading lower after weak economic data. Softer retail sales and industrial production figures pushed the Hang Seng Index down 1.2%. In Belgium and the rest of Europe, corporate news is quiet today due to the Assumption Day holiday. Investors can still savour the fresh records set by markets worldwide, with the Bel20 yesterday breaking its record for the first time in 18 years. The Spaarvarkens team wishes you a pleasant holiday.

Friendship is worth money

Not everyone is enjoying the benefits of AI. One such player is Applied Materials, the largest US producer of equipment for manufacturing computer chips. While companies like Nvidia and AMD are flirting with record highs, Applied Materials appears to be feeling the pain of the US–China trade war. Quarterly revenue came in at 6.7 billion dollars, a full 620 million dollars below analysts’ expectations. Earnings per share of 2.11 dollars also missed estimates by 0.27 dollars. Applied Materials is barred from exporting its products to China, and this weighs on its results. Nvidia and AMD faced the same problem but struck a deal with the Trump administration: from now on, they will transfer 15% of their China revenue to the US Treasury. If you want to do business as a US multinational, it’s best to stay on good terms with Trump. We expect Applied Materials to open in the red later today.

Flashback to 2023

Some shareholders of online payment specialist Adyen may have had a flashback to 2023 yesterday. During the pandemic, Adyen was a favourite among Dutch investors. In 2021, the share price peaked around 2,700 euros. After that, it entered a persistent downtrend, hitting rock bottom in summer 2023 when Adyen announced it would miss its growth targets. Investors threw in the towel, and within a month the stock lost more than half its value. Yesterday, Adyen issued a similar message, initially sending its shares nearly 20% lower. Growth slowed again as merchants processed fewer online payments, and the company cut its annual forecast. Remarkably, most of the early 20% loss was recovered by the end of the trading day, leaving a decline of just 5%. Investors who had the courage to buy after the 2023 plunge saw their investment nearly triple in price within a year and a half. Was that memory a reason to buy yesterday?

Did you know…

Palm oil company Sipef has been listed on the Belgian stock exchange since 1920? Its shares were once traded on the exchanges of Antwerp, Brussels, Geneva, Amsterdam, and Rotterdam!

This article was translated from Dutch and was originally published on Spaarvarkens.be.