Despite Expectations, Stock Exchanges Report Lows in Wednesday

Wall Street reached the middle of the week with unexpected lows, with Dow Jones decreasing 34,288.83 units and S&P lowering 4,387.55 units. The Mexican Stock Exchange lost 0.06% while oil experienced a drop as well. 

This Wednesday, Wall Street closed with high expectations resting on Nvidia’s earnings report. The company expects to grow 170% this fiscal year riding the AI chip wave. On its quarterly report of July 30, earnings were US$2.70 per share, adjusted, versus the expected US$2.09 per share, according to Refinitiv. Its revenue was US$2.29 billion more than expected at US$13.51 billion. However, the company could face trouble as US President Joe Biden’s administration has been urged to restrict the sales and exports of AI chips. Colette Kress, Finance Chief, Nvidia,  says that these restrictions will not have an immediate effect on revenue. 

Despite the expectations, stocks finished low led by the Dow Jones Industrial Average

by 0.51%, at 34,288.83 units. The S&P 500 market index was down 0.28%, at 4,387.55 units. The Nasdaq traded with a marginal advance of 0.06%, at 13,505.88 units.

Mexico’s two trading centers ended the day with mixed and marginal movements. The Mexican Stock Exchange (S&P/BMV IPC) registered a low of 0.03%, at 53,127.93 units. The FTSE-BIVA of the Institutional Stock Exchange lost 0.06% with 1,093.27 units. 

The Mexican Stock Exchange 2Q23 report reports that revenues reached MX$946 million (US$56.1 million), 5% lower compared to the same period last year. This is attributed to “lower trading in transactional businesses, fewer cross-border transactions in the global market and unfavorable exchange effect on dollarized services after the appreciation of the peso against the dollar.” This last one is the effect the superpeso still has on trade and remittances, both incredibly important for the Mexican economy. 

For GBMV, EBITDA was registered at MX$521 million (US$31 million) with a margin of 55% in 2Q23, while its net income amounted to MX$356 million (US$21.2 million). 

Negatives have also been recorded in the Commodities Market, which deals with raw materials, specifically oil. This is suspected to be because of low demand from China, but “Goldman Sachs sees less of a downside risk to oil prices from higher-than-expected inventories, noting that lower OECD commercial stocks could add US$2 to its end-2023 Brent outlook of US$86 per barrel.” 

Because of this, the West Texas Intermediate (WTI), a grade of crude oil, stood at a price of US$80.35 per barrel after dropping 0.46%, and the Brent benchmark fell 0.70%, trading at 83.87 greenbacks per unit.