Research Market strategy
By Swissquote Analysts
Published on 23.06.2021
Morning news

Microsoft Hits $2 Trillion Market Cap During Trading

Topic of the day

Microsoft shares are up about 1.1% on Tuesday, giving the technology giant a market value of about $1.99 trillion and putting it on the doorstep of joining Apple as the only U.S. public company to achieve that feat last August. The company's market cap has risen by about $960 billion from a March 2020 low, a figure greater than Facebook's market value, according to Dow Jones Market Data. Microsoft shares rose intraday to $265.60, putting its market value at slightly over $2 trillion intraday.

Swiss stocks

On Tuesday, the Swiss stock market has closed with small discounts. Traders spoke of a low momentum business with some caution in view of further indications of the authoritative U.S. monetary policy. After the close of trading in Europe, U.S. Federal Reserve Governor Jerome Powell held a hearing before a House subcommittee on the Corona crisis. The question of when the Fed would enter the cycle of monetary tightening remained unanswered, he said. Therefore, investors do not take great risks before such statements, it was said, referring to the reductions in the stock market. The SMI fell 0.1 percent to 11,982 points. Among the 20 SMI stocks were twelve price winners and seven losers, unchanged closed one share. A total of 26.96 (previously: 34.62) million shares were traded. With the weakness of the European banking sector, UBS and Credit Suisse lost 0.5 and 0.3 percent, respectively. Traders said Kepler Cheuvreux had issued negative comments on the sector. Defensive heavyweights from the pharmaceutical sector Roche (down 1.1%) and Novartis (down 0.4%) also tended to weaken. Nestle went out of trading little changed. SGS held (plus 0.3%) better than the overall market. The goods testing group does not want to make any changes to the dividend payout. Shares of online pharmacies came under greater selling pressure in Europe. This could have been in connection with an article in the trade journal "Apotheke Adhoc". According to this, there are said to be problems with the planned introduction of the e-prescription. The price of Zur Rose declined by 5.2 percent.

International markets


Major European stock indexes ended higher Tuesday, ahead of a hearing of Federal Reserve (Fed) Chairman Jerome Powell by the House of Representatives subcommittee charged with assessing the response to the Covid-19 pandemic. The Stoxx Europe 600 index gained 0.3% to 456.4 points. In Paris, the CAC 40 and SBF 120 gained 0.1% and 0.2%, respectively. In Frankfurt, the DAX 30 rose 0.2% and in London, the FTSE 100 rose 0.4%. Vivendi's general meeting (+0.3%) approved the demerger of its main division, Universal Music Group (UMG), through the distribution of 60% of the record company's capital to the group's shareholders. The resolution providing for this distribution in the form of a dividend in kind was adopted by 99.9%. The demerger of UMG is expected to take place at the end of September. The shareholders also approved on Tuesday by 73.6% the resolution allowing the group to reduce its capital by up to 50% through a public share buyback offer (OPRA), followed by the cancellation of the repurchased shares. EssilorLuxottica (-0.3%) announced that an arbitration court had authorized it to abandon the acquisition of Dutch optical distributor GrandVision (-7.7% in Amsterdam). The corrective lens manufacturer said it would study its options and communicate its decision at a later date regarding this transaction valued at 7.2 billion euros. Klépierre (-0.2%) is approaching a peak of "good news" related to the economic recovery and its valuation is starting to be stretched, according to JPMorgan Cazenove, which lowered its recommendation on the shopping center operator's stock from "neutral" to "underperform". The real estate company Gecina (+0.6%) announced the launch of a new green bond with a 15-year maturity and an amount of about 500 million euros. Europe's oil and gas sector climbed on Tuesday as Brent crude-oil futures reached $75 a barrel, a milestone demonstrating the recovery in demand as economies reopen. Integrated major oil companies Royal Dutch Shell and BP each rose 2%, and oil services firm TechnipFMC rose 4%, as the Brent contract ended Monday at the highest level since Oct. 31, 2018.

United States

U.S. stocks rallied again Tuesday and the Nasdaq Composite closed at an all-time high as investors waded into shares of technology and other growth stocks. Most major stock sectors rose Tuesday, extending the sharp gains indexes enjoyed a day earlier. Tuesday’s gains came as Federal Reserve Chairman Jerome Powell continued to reiterate that the recent increase in inflation will likely prove temporary. Speaking before Congress on Tuesday afternoon, Mr. Powell said the central bank will wait for actual inflation to take root before raising interest rates. The S&P 500 rose 21.65 points, or 0.5%, to 4246.44, leaving the broad index 0.2% away from its June 14 record. The Nasdaq Composite closed at a record after gaining 111.79 points, or 0.8%, to 14253.27. The Dow Jones Industrial Average also rose, adding 68.61 points, or 0.2%, to 33945.58. Nine of the 11 major S&P 500 sectors rose Tuesday. The two laggards were real estate and utilities. Consumer discretionary stocks in the index were out front, gaining 1%. Tech and communication stocks were also strong, with Netflix adding $11.82, or 2.4%, to $508.82, Facebook gaining $6.74, or 2%, to $339.03 and Twitter rising $1.82, or 2.9%, to $63.78. Other growth stocks also rallied, including Spotify, up $8.04, or 3.3%, to $253.64, and Zoom Video Communications, which added $5.40, or 1.5%, to $374.65. Other individual gainers included GameStop, whose shares rose $20.03, or 10%, to $220.40 after the videogame retailer said it had raised over $1 billion from the sale of shares. Meanwhile, Sanderson Farms added $17.20, or 10%, to $183.78 after The Wall Street Journal reported that the company is exploring a sale, according to people familiar with the matter.


In Tokyo, the Nikkei index can hold its ground at 28,896 points, while gains in the other places turn out to be slightly more significant. Hong Kong closes with a plus of 1.5 percent, Shanghai with plus 0.5% and Seoul with plus 0.4%. The stock of auto supplier Hanon Systems is down 4.8 percent in Seoul. According to a report, LG Electronics (-0.6%) wants to refrain from its potential bid for the company.


U.S. Treasury yields mostly fell on Tuesday, and the 2-year notching its biggest daily rate decline since mid-March, after Federal Reserve Chairman Jerome Powell reiterated that the central bank would be patient before pulling back from its ultra-easy policy stance. The yield on the 10-year U.S. Treasury note edged down to 1.471%, from 1.481% on Monday.


Jefferies raises Symrise target to EUR 111 (103) - Hold
Citi increases LVMH target to EUR 774 (713) - Buy
Citi raises Diageo target to 3,500 (3,325) p - Neutral

Produced by MBI Martin Brückner Infosource GmbH & Co. KG on behalf of Swissquote. All news is acquired with journalistic accuracy. No liability is assumed for delays or errors.