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Inflation Proves to Hurt NASDAQ As Much As The Pandemic, Oil Rises & Disney Stock Drops

NASDAQ falls to 2-year low following inflation data

 The NASDAQ fell to its lowest level since 2020, as the latest inflation report disappointed markets.

Figures released on Wednesday showed that inflation in the United States fell to 8.3% from 8.5%, however this was less than expected.

Markets were forecasting that inflation would fall to 8.1% annualized in April, however this 0.4% drop failed to materialize.


source: tradingeconomics.com

Some believe that foresight into these figures is what led to the Fed hiking rates by 0.5% last week.

Overall, U.S. inflation remains close to its highest point in the past 40-years.

Oil jumps over $100 per barrel, as inventories rise

Oil prices were once again above $100 per barrel today, following the release of U.S. crude inventories.

The figures released today showed that inventories increased by 1.6 million barrels for the week ended May 5th.

This is substantially greater than the drawdown of 3.5 million barrels the market was expecting, after recent forecasts.


source: tradingeconomics.com
ūüí° More on this
Meanwhile, gasoline stocks shrank by 3.607 million barrels, more than forecasts of a 1.574 million barrel drop; and inventories of distillate fuels, which include diesel and heating oil, decreased by 0.913 million barrels, less than expectations of a 1.312 million barrel draw. source: U.S. Energy Information Administration

Despite the U.S. looking to boost supply of energies by tapping into its reserves, this seems to be a more drawn out process than what markets were expecting.

As of writing, WTI crude is trading at $105.34.

Disney rally short-lived despite earnings and subscriber growth

Shares in Disney were in the red on Wednesday, as markets were preparing for the company‚Äôs Q1 earning‚Äôs call.  The House of Mouse closed down 2.29% to $105.21, after posting a 52 week low of $104.79 earlier in the day. 

With Netflix losing subscribers in Q1, many expect Disney+ would be one of the platforms to benefit, and this had been reflected in the analysts forecast of 135 million subscribers.

ūüí° Disney’s numbers
Disney did not disappoint as sub numbers came in at a robust 137.7m during the second fiscal quarter.   The Parks and experiences segment also saw revenue more than double to $6.7bn as the effect of the pandemic on attendance waned.

Operations are still suffering from Covid-19 as international travellers are not yet back to normal levels at U.S. parks and Shanghai Disneyland is currently shuttered under China’s Zero-Covid policy.

Following the release of the Company‚Äôs earnings $DIS initially increased to $111.00 in afterhours trading.  This high did not hold against the backdrop of the overall market as writing the stock has dropped to a fresh 52 week low of $103.00, down a further 2.1% from the earlier close of trading.

“Trading is not for the dabblers, the dreamers, or the desperate. It requires, above all, one steadfast trait of dedication. So if you are going to trade, trade like you mean it”

-Rod Casilli.

Eliman Dambell

Senior Market Analyst