Walmart’s (+7%) sales continued to grow as American shoppers kept flocking to its stores for inexpensive everyday necessities. U.S. comparable sales, or those from digital channels and stores operating at least 12 months, rose 3.8% in the quarter ended April 26. That was slower growth than last year, when comparatively higher prices sent sales soaring. Walmart said one-third of the quarter’s revenue growth came from new sources of non-retail business such as advertising and data. Walmart executives have been focused on increasing spending beyond groceries and everyday necessities to grow. Walmart’s net income hit $5.1 billion in the quarter, up from $1.67 billion in the same period last year, including equity investments. Walmart said full-year net sales are likely to come in at the high end or slightly above its previously expected range of a 3% to 4% increase. Operating income will also likely hit the high end or slightly above its previously expected range of a 4% to 6% increase, the company said.

A rally by heavyweight Roche and Swiss Re drove the Swiss stock market to new two-year highs on Thursday. The SMI rose by 0.4 per cent to 11,947 points. Among the 20 SMI stocks, there were twelve losers and eight gainers. A total of 21.59 (previously: 20.36) million shares were traded. Roche climbed 3.2 per cent and thus supported the overall market. The pharmaceutical company has recorded a success in an important business area. Positive weight loss results were achieved with a drug candidate undergoing clinical trials in adults with obesity. Swiss Re even surged by 3.8 per cent. Thanks to a good investment result and the absence of major natural catastrophes, the reinsurer reported a profit well above forecasts. Zurich Insurance increased by 3.5 per cent. In property and casualty insurance, the Group recorded 5 per cent growth in gross premiums in the first quarter. Insurance sales rose by 8 per cent in the corporate customer business and by 10 per cent in the private customer business. Novartis (-0.7%) was tendered 79.6 per cent of the Morphosys shares. This clearly exceeded the minimum acceptance threshold of 65 per cent. ABB lost 1.1 per cent in the industrial goods sector on the back of weak business figures from Germany's Siemens.

Europe
European equity markets lost ground on Thursday, held back by profit-taking as investors continued to question the trajectory of inflation and interest rates in the United States. The Stoxx Europe 600 index fell by 0.2% to 523.6 points. The CAC 40 and SBF 120 lost 0.6% each. In Frankfurt, the DAX 40 gave up 0.7% and in London, the FTSE 100 shed 0.1%. Elior jumped 22.8%, the biggest increase within the SBF 120. The catering and concessions group returned to profit in the first half and raised its Ebita margin target for the full year. Derichebourg, owner of a 48.3% stake in Elior, gained 9.2%. Ubisoft fell by 13.5% as the video game publisher reported negative free cash flow for the third year running in 2023-2024. EasyJet (-6% in London) announced that its chief financial officer, Kenton Jarvis, would replace Johan Lundgren as chief executive early next year. The low-cost airline also reported a further adjusted pre-tax loss in the first half of its trading year. Siemens (-6.8% in Frankfurt) confirmed the sale of its Innomotics large engine business to US private equity firm KPS Capital Partners for €3.5 billion.

United States
The Dow Jones Industrial Average crossed 40000 for the first time, a milestone that appeared implausible a little more than two years ago when the Federal Reserve began raising interest rates to cool an overheated economy. The Dow rose as high as 40051 on Thursday morning before pulling back to close at 39869. It has soared nearly 40% from its low in September 2022—and more than doubled since the spring of 2020, when attempts to slow the spread of Covid-19 closed swaths of the economy. The 30-stock index has advanced 5.8% this year, setting 18 record closes along the way. The broader-based S&P 500 and the tech-heavy Nasdaq Composite are both up 11%. Among individual stocks, Cisco lost 2.7 per cent despite better-than-expected quarterly figures and an improved outlook. Without the 28 billion dollar acquisition of the cyber security company Splunk, the decline in sales would have been more pronounced. Deere dropped 4.7 per cent. The agricultural machinery manufacturer lowered its profit forecast and expected a sharper decline in sales in two of its three main business segments. Johnson & Johnson (+1%) strengthened its dermatology portfolio and bought the biotechnology company Proteologix for an initial 850 million US dollars. American International Group sells further shares in its life insurance and pension business Corebridge Financial. The US insurer is divesting a 20 per cent stake to Japan's Nippon Life Insurance for USD 3.8 billion. The share price shed 0.2 per cent. Chubb improved 4.7 per cent after the company became known as Berkshire Hathaway's ‘mystery stock purchase’. AST SpaceMobile shot up more than 68 per cent after the company signed an agreement to provide satellite broadband for AT&T mobile phones.

Asia
Stocks in Asia mostly fell. The Hang Seng Index however rose slightly by 0.3 per cent. On the Chinese mainland the Shanghai Composite fell by 0.1 per cent. In Tokyo, the Nikkei index traded 0.3 per cent lower at 38,816 points. The Kospi in Seoul lost 1.0 per cent to 2,727 points. Shares in HD Hyundai Heavy Industries dropped 7.1 per cent after its intermediate holding company HD Korea Shipbuilding & Offshore Engineering (-2.5 per cent) decided to sell a 3 per cent stake. The Sydney Stock Exchange is now down 0.7 per cent following the significant gains of the previous day.

Bonds
U.S. government debt yields advanced on Thursday, after data showed weekly jobless-benefit claims remained rangebound. The 10-year Treasury note yield gained 2 basis points to 4.379%. The 2-year Treasury note yield climbed 6 basis points to 4.795%.

Analysis
SoftwareONE price target: UBS raises target to CHF 19.50 (18.85) - Buy
Stifel upgrades Geberit target to CHF 615 (600) - Buy
DZ Bank lifts Swiss Re to Buy (Hold) - target CHF 122 (105)

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