U.S. Markets Begin Week With Gains, Latin America’s With Losses

A roundup of Monday’s stock market results from across the region

🗽 On Wall Street:

U.S. stock markets started the week higher, following the rebound in Asia as a result of the decline of Covid-19 contagion, although the gains seen during the session failed to rebound further as 10-year Treasury bond yields rose.

The selloff in these assets pushed yields back above 3%, a level not seen since May and adding further arguments to the risk aversion that has dominated markets in 2022.

The S&P 500 advanced 0.31%, while the Dow Jones Industrials gained 0.05%, and the Nasdaq Composite (CCMPDL) climbed 0.40%.

Twitter’s shares sank, falling almost 1.5% after Elon Musk once again warned that he could halt the purchase of the social network.

The billionaire entrepreneur assured that the company is in breach of the acquisition agreement by not providing more data on the social network’s spam accounts. Twitter responded that it “will continue to share information to consummate the transaction under the terms of the agreement”.

Amazon (AMZN) stock also starred on the day in the first trading session following a 20-for-1 stock split, the e-commerce company’s first such move in more than two decades.

🔑 The Day’s Key Movements:

The war in Ukraine, which has now passed the 100-day mark, will negatively impact Latin America and cause lower economic growth, which will in turn harm job creation and the fight against poverty, according to the Economic Commission for Latin America and the Caribbean (ECLAC).

The organization also warned that this scenario could lead to a climate of social instability that could end up affecting foreign investment.

ECLAC expects the region to have an average annual growth of 1.8%, a figure even lower than the 2.1% deceleration it had already predicted for the year in May. The lower economic performance will affect the alleviation of poverty, which rose after the lockdowns of the pandemic.

ECLAC estimated that, if this scenario persists, 7.8 million people will be added to the 86.4 million in extreme poverty during 2022.

The organization emphasized that more expensive food will force the poorest households to reduce or substitute the consumption of essential goods.

📉 A Bad Day:

Monday was not a good day for Latin American stock markets, with all of the region’s main indices closing with losses, led by Argentina and Peru, which closed down more than 1%.

Argentina’s Merval (MERVAL) retreated from the rise it saw last Friday, dragged down by the shares of Compañía de Transporte de Energía (TRAN), Transportadora Gas del Norte (TGNO4) and Cresud (CRES) shares.

The S&P BVL/Peru (SPBLPGPT), meanwhile, was hit by the performance of the consumer staples, finance and materials sectors.

The Brazilian and Mexican stock exchanges followed suit, with Brazil’s Ibovespa (IBOV) closing lower as investors remain cautious regarding news that the government will publish a proposal to maintain fuel prices.

This measure is considered a fiscal risk and weighed on the market’s mood.

In the case of the Mexican stock market, the S&P BMV/IPC (MEXBOL) also slipped more than 1%.

🍝 For the Dinner Table Debate:

Apple Inc (AAPL) on Monday unveiled a host of new hardware, software features and services at its Worldwide Developers Conference, including an updated lock screen for the iPhone and a deferred payment option that underscores the tech giant’s increased push into the world of finance.

The newest version of Apple’s iPhone software, iOS 16, will include the new lock screen, which will allow users to customize the feature and view widgets.

A feature called Live Activities will make it easier to track events or activities, such as an NBA game or an Uber ride.

The announcements also included an update that will allow users to edit messages they have already sent and ‘unsend’ them.

The Apple Watch will also receive enhancements. These include a trial fibrillation detection to aid heart health.