Wall Street: explosion of multiples with a positive Nasdaq on 2020

  •   11/05/2020 - 09h04
  •   DEHOUI Lionel

This Thursday, the U.S. stock market is not at its highest closing level. But, they already allow Wall Street to catch up on the side of electronic transactions. In fact, Wall Street recorded an additional gain of +0.4%. This automatically affects the evolution of the indexes which are at their highest level this Thursday. After its highest score (24.095), the Dow Jones ended up making a gain of 0.9% at 23.873. The same scenario occurred for the Standard & Poors 500 which gains +1.05% to 2.880 points. In doing so, the S&P-500 returns to its mid-May 2019 values. On the other hand, the Nasdaq Composite returns to positive values over 2020, holding steady at over 8,980, or +1.3%. But, the detachment of the day comes from the Russel-2000 which shows with +1.58% to 1,283. The Nasdaq-100 also realizes +1.3%.

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Wall Street: explosion of multiples with a positive Nasdaq on 2020
Image copyright: krispdk - Flickr

The explosion of multiples

Note that the Nasdaq-100 has received the support of PayPal, which has an excellent score (+14%) due to the explosion of electronic payments. It should be noted that the Nasdaq-500 has experienced a minimum 25% drop in expected profits for the year 2020. However, it has now recorded +4.2% since the first day of January, while its visibility remains zero for 2021.

The historical fact comes from the multiples. By the way, the multiples are experiencing an expansion that is in a new phase marked by a significant acceleration. In addition, valuations are well above those of the " dot.com " bubble. For more than a month and a half, we have been witnessing a succession of liquidity on the FED side.

 

The values of American companies

The values to follow on Wall Street are on the side of some companies. Apple takes +1%, American Airlines +3.1%, Delta +3.2%, JD.Com +3.4%, Splunk +3.8%, Intuitive +4.7%, Zoom and Workday +5.5% with Marriott taking +6%. But, the Uber group is up +8% at one hour after closing. This explains well the rise of the future US even if the group announced a loss of 2.9 billion dollars in Q1.

This corresponds to -$0.64 excluding non-recurring items following an estimated depreciation of $2.1 billion. The latter was spent on minority investments. Food delivery at Uber Eats, on the other hand, is on the rise due to containment. With the deconfinement, the group is hoping for a resumption of activity in the transport sector. As a result, vehicle disinfection will make life difficult for drivers (high costs and time consuming).

Information: On Thursday, the U.S. Department of Labor reported that 3,169,000 new people registered for unemployment benefits in the past week. The week before, their number was 3,846,000 against an initial forecast of 3,839,000. Job losses totalled 33.5 million. However, the consensus estimate was 3 million. Taking the moving average (in 4 weeks) of 4 173 500, the number of applicants falls by 861 500.