Can you believe it? We’ve already reached the fifth month of the year and there’s plenty of volatility in the markets. The month of May promises to be another wild ride with lots of surprises. Let’s take a look at all the major events coming up.
Head to head this week
Airbnb vs. Booking
After two years of lockdowns and health crises, the global tourism industry is slowly healing. And as the summer season approaches, with most restrictions lifted, the travel sector is stepping up its efforts to boost growth. Investors are therefore watching tourism companies like Booking and Airbnb closely.
- On Tuesday, May 3rd, Airbnb is expected to post earnings per share of $0.27, an increase of 84.57% year-on-year. Net sales could hover around $1.46 billion, up 64.4% from the same period last year. The only downside for the group: new rules and restrictions in certain cities, particularly in France.
- The next day, Wednesday May 4th, its competitor Booking will report. The company is considered undervalued by a good number of analysts, with the stock lagging behind many others in the industry. The company also has been known to surprise investors with better-than-expected results. Booking has also made several promising acquisitions lately including Getaroom, FareHarbor and Etraveli.
Pfizer vs. Moderna
Big Pharma is also in the spotlight this week with two of the biggest companies in the industry reporting earnings. Both have played a big role in the Covid-19 vaccines.
- On Tuesday, May 3rd, Pfizer is expected to post earnings of $1.73 per share for the current quarter, which would be an increase of 86% year-on-year. In addition, the group generated free cash flow of $30 billion in 2021, and could significantly exceed it in 2022. This means that Pfizer can reinvest this money in its growth and R&D.
- On Wednesday, May 4th, it will be Moderna‘s turn to publish its quarterly results with $4.68 billion in estimated sales, representing growth of 138.7%. Similarly, Moderna is expected to post earnings of $5.99 per share for the current quarter, which would be up 110.9% year-on-year.
The big macro picture
The biggest issue in the entire financial markets right now is: interest rates. This Wednesday, May 4th, the US Federal Reserve, chaired by Jerome Powell, will put the subject back on the table with a planned increase of half a point, higher than last month. The Fed may also discuss increasing the pace of rate hikes.
On the same day, the European Central Bank will meet in Frankfurt for a “non-monetary” meeting. In other words, there will be no decision on interest rates, but the subject will likely be discussed.
What does this mean for your investments? Some analysts believe that rate hikes will slow growth and even trigger a recession. For that reason, many investors are cautious about the near-term future. With that in mind, remember to keep a diversified portfolio! You can also take a look at ETFs that contain bonds like the EUR Government Bonds ETF (VanEck) or the US Government Bonds (3-7Y) ETF (Lyxor).
Economic and earnings calendar
Tuesday – Unemployment rate in Germany and euro zone (March). New vehicle sales in Spain and the United States (April). New vehicle registrations in France (April). Quarterly results of Airbnb, Pfizer, AMD, Starbucks, BNP Paribas.
Wednesday – Trade balance in Germany and the United States (March). Fiscal balance in France (March). ECB non-monetary meeting. Unemployment rate in Spain (April). Retail sales in the euro zone (March). Fed decision on interest rates. Quarterly results from Volkswagen, CVS Health, Booking, Siemens, Moderna.
Thursday – Industrial production in France (March). US weekly unemployment figures. Consumer confidence index in Spain (April). New vehicle registrations in Germany (April). Quarterly results of Shell, ConocoPhillips, Airbus, AXA, Henkel.
We’ll be back next week with another edition of the BUX Breakdown. In the meantime, have a great week on the markets!
The BUX Breakdown was written by Clémentine Pougnet.
All views, opinions, and analyses in this article should not be read as personal investment advice and individual investors should make their own decisions or seek independent advice. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication.