Trading results for 12 February 2025
Everything is going according to plan. That sounds great, right? The problem is that, unfortunately, no one actually knows what this plan is. On Tuesday, analysts expected calm and stability. And that’s exactly what happened. On Wednesday, everyone braced for increased volatility and market tension. That also happened. However, the trigger for it was rather unexpected. Trouble came from where no one anticipated – macroeconomic data on consumer inflation.
Analysts predicted that inflation in January would ease, with the monthly rate declining from 0.4% to 0.3%. Instead, the opposite happened – inflation not only failed to slow but actually accelerated to 0.5%. Meanwhile, annual inflation rose from 2.9% to 3%. Even more concerning was the core inflation index (Core CPI), which excludes food and energy prices, increasing to 3.3%. In short, a disaster! At least, that’s how market participants reacted.
Before the inflation data release, indexes hovered around neutral levels. But as soon as the figures were published, markets plummeted, with the opening of the main trading session seeing losses of more than 1% compared to the previous day’s close. At that moment, some may have thought it was game over: the Fed definitely won’t cut rates now, Trump will fuel inflation by reigniting trade wars, and there will be no stock market growth and easy profits!
However, these gloomy thoughts didn’t last long. Within just a few hours, investors brushed them aside and started buying up the dip. The market began recovering surprisingly well without any clear reason, and by the end of the session, the NASDAQ Composite even managed to close slightly in the green (+0.03%). Meanwhile, its two larger peers, the Dow Jones (DJIA-30) and the S&P 500, weren’t as lucky, ending the day with small losses of 0.5% and 0.27%, respectively.
What the U.S. indexes couldn’t achieve, the ITS indexes did. Both the ITS World Index (ITSW) and the ITS Shariah Index (ITSS) finished the day in positive territory, gaining 0.19% and 0.07%, respectively. Notably, the ITSW index once again hit new all-time highs, both in absolute terms and at market close. The key driver behind this was none other than Kazakhstan’s powerhouse, Kaspi.kz (KSPI, +7.47%), which was the best-performing stock in the ITSW index, surging over 7%. Following KSPI, Chinese tech giants saw strong demand from global investors, contributing significantly to the ITSW index’s resilience.
The biggest losers of the day within ITSW were oil and gas sector stocks. This sector was the worst performer in the S&P 500, with average losses of 2.1%. In ITSW, the worst-hit stock was Exxon Mobil (XOM, -3.87%), which tumbled nearly 4% as investors worried about the potential for new trade wars and a resulting decline in oil demand.
As for the ITS Shariah Index (ITSS), the day’s top gainers were Tesla (TSLA, +2.44%) and AstraZeneca (AZN, +2.34%). Tesla rebounded after a sharp decline of more than 6% the previous day, though whether this recovery will continue remains uncertain. Meanwhile, AstraZeneca’s rally appears to be just getting started. Investors were highly impressed by the company’s quarterly earnings report released last week.
AstraZeneca’s performance significantly exceeded analysts’ expectations. Experts had forecast lower revenue ($14.15 billion) and much lower adjusted net profit of $1.06 per share. The company, however, outperformed across the board. AstraZeneca’s key strength lies in its diverse and proprietary drug portfolio. During the reporting period, the company excelled in oncology, as well as in respiratory diseases and immunology, with sales in these segments rising by 24% and 25% year-on-year, respectively. Sales of cardiovascular, renal, and metabolic (CVRM) treatments also grew by 20%.
AZN’s strength lies in its consistent growth across multiple drug categories and strong operational efficiency. It’s no surprise that many analysts remain optimistic about the company’s future prospects.
Looking back on Wednesday’s trading session, one key takeaway stands out: investors seem unwilling to acknowledge negative news and are eager to maintain positions or buy more stocks. The market has become completely Teflon-coated – nothing sticks. This is both good and bad. It’s good because there are no signs of panic selling or major concerns. However, it’s also risky, as prolonged negativity could eventually trigger a “dam break” scenario, unleashing a wave of selling pressure. Hopefully, we can avoid that last part altogether.