🚖General Motors: Poor Guidance Arrived🛻

Shares of the company wobbled as the full-year outlook appeared conservative. Earnings per share were strong and stood at $1.52 compared to estimates of $0.98. Sales were weak, but it is not a surprise, given a global semiconductor shortage affecting car production. The low inventories are also pushing car prices and improving profitability.

Although the company had increased its full-year per share guidance, it is still smaller than the current quarter beat, affecting the stock’s sentiments. The company used to be one of Pika World’s favourites, but we have since pared off all positions. Nonetheless, the prospect of the company’s future under the new CEO is on track to enable the company to rise out of its legacy tag.

💴Here comes the Tax story Again💰

Democrats in the Senate are now proposing a minimum 15% corporate income tax rate as they continue to hunt for new revenues to fund President Biden’s social spending bill, including those plans to combat climate change.

To fully implement the different bills will cost a hefty $2 trillion over the decade. The 15% tax rate is still much lower than the envisaged 25%. A complication arises as some party members have differing views since Democrats need nearly all members to be tightly aligned.

Pika World continues to monitor the bill’s passage as we expect an impact on the inflation rate and economic growth projection with the successful approval of the spending bills.

🖥AMD: Pika World’s Favourite💻

The company had reported a good set of results, and shares had risen sharply in 2021 as they continue to capture market shares from Intel. In addition, the company saw strength in the premium PC market, which is a bright spot for AMD.

Guidance was also healthy. The company is expecting up to $4.4 billion $4.6 billion in revenue, which is still above the consensus level of $4.24 billion. A more vital sign is its projection that it expects a healthy expansion in all of its business segments.

Pika World has a position in AMD as we believe the stock price is rewarded by the firm revenue growth in server units and other high-growth areas. As a result, we maintain a positive outlook on the company.

⚒Political tension continues to Brew🔭

One of China Telecom’s units is denied of its operation in the US on national security grounds. Political risk in a business environment is still operating in the background as the Federal Communications Commission (FC) is still eyeing the potential threats the Chinese government poses.

While Auntie Yellen and the Chinese Vice Premier had talked for the second time in four months, Pika World believes the ongoing hostile action between both countries will still be in investors’ minds.

📮What’s on the Menu Today?

At 8.30 pm, we will receive The GDP data, which we expect a slower growth rate of 2.7% compared to 6.7% in the prior period.

Initial Jobless Claims will also be released concurrently, and we expect the same level at 290K from the previous period.

ECB Press Conference will also begin at 8.30pm.

Pika World will be looking at the labour market and regional economies in Europe for clues of buoyancy in the market.

It is Oct 28, Thursday, at 7.15 am in Singapore and 7.15 pm in New York. The earnings season appears strong, and we hope all Pika World’s friends a splendid finish for Oct 2021.