Weekly Stockwatch: Renault Profits, US Notorious Markets List, Australian Earnings, Nvidia Record Revenues & More

Renault Profits

The French automaker returned to annual profits for the first time in three years, as it reported on Friday Group Net Income of €888 million in 2021, from a Net Loss of €8 billion in the prior year. [1]

The Group's Revenues rose 6.3% year-over-year, to €46.213 billion, while Operating Margin strengthened to 3.6% - ahead of schedule for above 3% margins in 2023.

Its forward guidance for 2022, sees operating margin superior or equal to 4%, despite the semiconductor crisis.

CEO Luca de Meo, said that "Renault Group largely exceeded its 2021 financial targets despite the impact of semiconductor shortages and rising raw material prices".

RNO.fr opened higher after the results and set fresh 2022 highs, but at the time of writing, it was erasing gains.

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US Notorious Markets List

On Thursday, the Office of the United States Trade Representative (USTR) released its updated Notorious Markets List, which highlights online and physical markets that reportedly engage in or facilitate substantial trademark counterfeiting or copyright piracy. [2]

The list included for the first time the China-based AliExpress and WeChat e-commerce ecosystems, which are operated by Alibaba Group and Tencent respectively. Other high-profile Chinese online markets such as Baidu Wangpan and Pinduoduo, remained on the list.

BABA.hk and TENC.hk both dropped on Friday and closed the week with losses.

Australian Earnings

Telecoms giant Telstra and retail & industrial diversified company Wesfarmers, both announced their financial results for the first half of FY2022 (period ended December 2021).

Telstra reported Net Profit (NPAT) of A$0.7 billion, which marked 34% year-over-year drop, although Underlying Earnings (EBITDA) grew 5.1% y/y. to A$3.5 billion.

CEO Andrew Penn, noted that "This was the second consecutive half of underlying growth". On the 5G mobile network, he said that as now more than twice the size of Telstra's next nearest competitor, with more than 77.5 per cent of the population covered."

Wesfarmers Revenues remained roughly unchanged at A$17.758 billion, while Net Profit (NPAT) dropped 14.2% year-over-year, to $1.213 billion. [4]

Managing Director Rob Scott, said that "the first half of the 2022 financial year was the most disrupted period for our businesses since the onset of COVID-19,".

The "Chemicals, Energy and Fertilisers" segment was the over-performer, as its Revenue increased by 29.8% year-over-year, to A$1.077 billion.

TLS.au and WES.au slumped on Thursday after the report, bots escaping fresh 2022 lows though. [4]

Nvidia Record Revenues

The chip giant posted new record Revenues of $7.64 billion for Q4 FY 2022 on Wednesday, up 53% from a year earlier. Its core Gaming business and the increasingly important Data Center segment, also hit all-time high figures. [5]

For the first quarter of the year (Q1 FY2023), Nvidia provided upbeat guidance with Revenues of $8.10 billion, plus or minus 2 percent.

Last week, Nvidia abandoned the $40 billion acquisition of chip-designer Arm, due to regulatory challenges.

Despite the solid results, markets did not seem impressed, with NVDA.us dropping on Thursday after the report and in Friday, at the time of writing, it was extending its losses.

Airbus Strong 2021 Performance

The European aerospace conglomerate posted strong financial results for 2021. Revenues rose 4%, to €52.1 billion and Adjusted Profits (EBIT) exploded 185% up from last year.

Its guidance for 2022 was also solid, projecting 720 commercial plane deliveries and EBIT Adjusted of €5.5 billion, but AIR.fr dropped after the results.

Next Week (February 21-25)

During the upcoming week, reporting from high-profile companies in the United States is scarce, while on Monday, Wall Street will remain closed due to holiday.

We continue to see a stream of earnings from Australia, with airliner Qantas and retail giant Woolworths, being some of those that stand out.

The UK banking sector will also be in the spotlight, as we expect financial results form HSBC, Barclays and Lloyds.

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 18 Feb 2022 https://www.renaultgroup.com/wp-content/uploads/2022/02/rg_2021_fy_results_gb-pr.pdf

2

Retrieved 18 Feb 2022 https://ustr.gov/about-us/policy-offices/press-office/press-releases/2022/february/ustr-releases-2021-review-notorious-markets-counterfeiting-and-piracy

4

Retrieved 18 Feb 2022 https://wesfarmers.gcs-web.com/static-files/91426610-1561-4528-acfd-da9b19e67902/

5

Retrieved 09 Dec 2022 https://nvidianews.nvidia.com/news/nvidia-announces-financial-results-for-fourth-quarter-and-fiscal-2022

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