Market Update
Movers: Dick's Sporing Goods, Gaia, Intrepid Potash, JetBlue, Meta, Rivian, ThredUp, WW International
Scott Peters
07 Mar, 2023
New York City
Dick's Sporting Goods Inc increased 9.2% to $144.28 after the specialty retailer reported higher-than-expected sales in the holiday period.
Profit in the fourth quarter declined 32% despite sales rising 7.3% in the period, hurt by lower gross margin.
Net sales in the quarter rose 7.3% to $3.60 billion from $3.35 billion in the previous year and comparable store sales rose 5.3%.
Net income fell to $235.6 million or $2.60 per share from $346.1 million or $3.16 per share in the prior-year quarter.
Excluding items, adjusted income decreased to $2.93 per share from $3.64 a year ago.
Gaia, Inc soared 24.5% to $3.28 after the alternative video content producer and streamer swung to a net loss in its latest quarter.
Gaia, Inc said revenue in the fourth quarter declined 6%to $19.6 million from $20.8 million and video content publishing company swung to a net loss of $0.9 million from a profit of $2.1 million and diluted earnings per share was ($0.04) compared to 11 cents a year ago.
In 2022, revenue increased 3% to $82.0 million from $79.6 million and the company swung to a loss of $3.1 million from a profit of $3.7 million and diluted income per share fell to ($0.15) from 19 cents a year ago.
The member count as of December 31, 2022 was 759,000.
Intrepid Potash, Inc declined 1.7% to $31.62 after the agrochemicals maker said a decline in earnings after higher potash costs forced farmers to restrict purchases.
Intrepid Potash, Inc said revenue in the fourth quarter increased to $43.7 million from $38.8 million and net income fell to $3.98 million from $223.8 million and diluted earnings per share fell to 30 cents from $16.66 a year ago.
Potash production in the quarter increased to !06 tons from 86 tons and sales volume fell to 50 tons from 61 tons a year ago. Average potash net realized sales price per ton increased to 693 from 504 a year ago.
Revenue in the full-year 2022 rose to $337.5 million from $270.3 million and net income fell to $72.2 million from $249.8 million and diluted earnings per share fell to $5.37 from $18.66 in the previous year.
In the full-year 2022, potash production volume in tons fell to 270 from 287, sales volume in tons declined to 222 from 331 and average potash realized net sales price per ton rose to $713 from $353 a year ago.
JetBlue Airways Corporation declined 0.2% to $8.39 and the Justice Department sued the company to block its proposed takeover of the discount airline Spirit Airlines.
Meta Platforms Inc increased 1% to $186.33 after a Bloomberg report said that the parent of Facebook is planning to layoff thousands of employees as early as this week.
Rivian Automotive Inc plunged 12% to $15.02 after the electric vehicle maker said it plans to offer $1.3 billion convertible debt amid growing demand slump.
The electric vehicle maker lost $6.8 billion in 2022 and after supply chain issues negatively impacted production.
ThredUp Inc soared 69.8% to $2.75 after the online apparel and accessories resale platform operator reported better-than-expected revenue. The company also highlighted cost cutting steps to reach profitability.
ThredUp Inc said revenue in the fourth quarter decreased 2% to $71.3 million and net loss attributable to stockholders was $19.5 million compared to $17.9 million and diluted loss per share increased to 19 cents from 18 cents a year ago.
The resale platform operator said active buyers decreased 2% to 1.7 million and orders fell 8% to 1.5 million from the previous quarter.
In 2022, revenue increased to $288.3 million from $251.8 million and net loss expanded to $92.3 million from $63.2 million and diluted loss per share rose to 92 cents from 82 cents a year ago.
Orders in the full-year increased 22% to 6.5 million from 5.3 million in the previous year.
WW International Inc soared 42.5% to $5.52 after the the company reported an acquisition of telehealth services provider Sequence.
The company agreed to pay $132 million for the purchase of Sequence in three stages.
Since its launch in late 2021, Sequence has grown into an approximately $25 million annual revenue run-rate business serving approximately 24,000 members as of February.
Formerly known as Weight Watchers said revenue in the fourth quarter declined 18.8% to $223.9 million from $275 million in the previous year.
The company swung to a net loss of $32.5 million from a profit of $29.0 million and diluted earnings per share was ($0.46) compared to 42 cents a year ago.
Europe Movers: Ashtead Group, Greggs, HelloFresh, Henkel, John Woods, Schaeffler, Zalando
Bridgette Randall
07 Mar, 2023
Frankfurt
Schaeffler AG fell 7.3% to €6.84 after the Germany-based bearings maker reported a decline in financial year 2022 profit and issued a cautious outlook for 2023.
The company also trimmed its dividend.
Henkel AG declined 2.2% to €67.70 after the German chemical and consumer goods company reported a 13.7% decline in its adjusted operating earnings in 2022.
HelloFresh SE decreased 6.9% to €21.16 after the meal-kit maker estimated lower-than-expected core profit in 2023.
Ashtead Group plc increased 3.3% to 5,936.0 pence after the UK-based equipment rental company said annual results are likely to surpass its own estimate.
Zalando SE increased 3.4% to €40.15 after the online marketplace operator said it plans to focus on improving its operating margins and eliminate unnecessary costs.
John Wood Group Plc increased 14.3% to 221.80 pence after the UK-based engineering company said it is likely to reject the latest buyout proposal from the private equity group Apollo Global Management.
Greggs Plc declined 0.7% to 2,732.0 pence after the bakery and fast food chain said that the company is facing inflationary cost pressures.
Fed Chairman Powell Suggested Terminal Rates to Exceed Previous Estimates
Brian Turner
07 Mar, 2023
New York City
Federal Reserve chairman Jerome Powell said the central bank is ready to increase rates faster if incoming data supported the case.
Moreover, Powell added that the terminal rates are likely to be higher than previously estimated.
Chairman Powell noted that latest economic data have been stronger-than-anticipated and to bring down inflation to 2% and restore price stability will require raising rates to restrictive levels.
At the Fed's policy meeting in February, the committee raised the target range for federal funds by 25 basis points to between 4.5% and 4.75%, the highest level since 2007.
Powell highlighted the difficulties in bringing down inflation to the long-run rate of 2%.
"We are seeing the effects of our policy actions on demand in the most interest-sensitive sectors of the economy. It will take time, however, for the full effects of monetary restraint to be realized, especially on inflation.
In light of the cumulative tightening of monetary policy and the lags with which monetary policy affects economic activity and inflation," noted Powell in his prepared remarks.
The talk of faster rate hikes and higher terminal rates spooked investors and tech stocks accelerated the decline in early trading.
Major Indexes Fall On Rate Path and Terminal Rate Worries
Barry Adams
07 Mar, 2023
New York City
The uptick in Treasury yields came together with a weakness in high-growth and tech stocks after the Federal Reserve chairman delivered a hawkish sentiment in his prepared remarks for lawmakers.
Federal Reserve chairman Jerome Powell said the central bank is ready to increase rates faster if incoming data supported the case.
Moreover, Powell added that the terminal rates are likely to be higher than previously estimated.
Chairman Powell noted that latest economic data have been stronger-than-anticipated and to bring down inflation to 2% and restore price stability will require raising rates to restrictive levels.
At the Fed's policy meeting in February, the committee raised the target range for federal funds by 25 basis points to between 4.5% and 4.75%, the highest level since 2007.
The talk of faster rate hikes and higher terminal rates spooked investors and tech stocks accelerated the decline in early trading.
Indexes & Yields
The S&P 500 index decreased 0.6% to 4,023.25 and the Nasdaq Composite index fell 0.6% to 11,602.35.
The yield on 2-year Treasury notes inched higher to 4.96%, 10-year Treasury notes inched higher to 3.98% and 30-year Treasury bonds edged higher to 3.90%.
Crude oil fell 94 cents to $79.54 a barrel and natural gas prices increased 5 cents to $2.63 a thermal unit.
U.S. Stock Movers
Dick's Sporting Goods Inc increased 9.2% to $144.28 after the specialty retailer reported higher-than-expected sales in the holiday period.
Profit in the fourth quarter declined 32% despite sales rising 7.3% in the period, hurt by lower gross margin.
Net sales in the quarter rose 7.3% to $3.60 billion from $3.35 billion in the previous year and comparable store sales rose 5.3%.
Net income fell to $235.6 million or $2.60 per share from $346.1 million or $3.16 per share in the prior-year quarter.
Excluding items, adjusted income decreased to $2.93 per share from $3.64 a year ago.
JetBlue Airways Corporation declined 0.2% to $8.39 and the Justice Department sued the company to block its proposed takeover of the discount airline Spirit Airlines.
Rivian Automotive Inc plunged 12% to $15.02 after the electric vehicle maker said it plans to offer $1.3 billion convertible debt amid growing demand slump.
The electric vehicle maker lost $6.8 billion in 2022 and after supply chain issues negatively impacted production.
Meta Platforms Inc increased 1% to $186.33 after a Bloomberg report said that the parent of Facebook is planning to layoff thousands of employees as early as this week.
German Factory Orders Advanced, UK Home Price Increased
Bridgette Randall
07 Mar, 2023
Frankfurt
Stocks in Europe lacked direction and investors reacted to local earnings and awaited commentary from the U.S. Federal Reserve chairman Jerome Powell.
France's benchmark index advanced to a new record high and Germany's index traded at a new one-year high after energy prices eased for the third week in a row.
German factory orders unexpectedly rose and the UK's home prices rose at the fastest pace in eight months.
German Factory Orders Unexpectedly Rose In January
German factory orders rose unexpectedly in January driven by demand from international customers.
German factory orders increased 1.0% in January from the revised 3.4% in December, the Federal Statistical Office or Destatis said Tuesday.
Manufacturing new orders on an annual basis declined at a faster rate of 10.9% in January after dropping 9.9% in December.
UK Home Prices Increased at 8-month High Rate
Home prices in the UK rose at a faster pace in February underpinned by the improving confidence and resilient labor markets.
Despite the cost of living crisis, home prices rose 1.1% in February after rising 0.2% in January, S&P Global and Halifax said in a report released Tuesday.
Home prices rose for the second month in a row and jumped at the fastest pace since June 2022.
The average home price increased to £285,476 in February compared to £282,360 in January.
Indexes & Yields
The DAX index increased 0.2% to 15,678.50, the CAC-40 index added 0.2% to 7,387.18 and the FTSE 100 index advanced 0.3% to 7,949.76.
The yield on 10-year German Bunds edged down to 2.66%, French bonds to 3.15%, the UK gilts to 3.78% and Italian bonds to 4.45%.
The euro hovered near $1.065, the British pound inched lower to $1.19 and the Swiss franc to 93.36 cents.
Brent crude oil eased 56 cents to $85.56 a barrel and the Dutch TTF natural gas edged up to Є42.05 per MWh.
Europe Stock Movers
Schaeffler AG fell 7.3% to €6.84 after the Germany-based bearings maker reported a decline in financial year 2022 profit and issued a cautious outlook for 2023.
The company also trimmed its dividend.
Henkel AG declined 2.2% to €67.70 after the German chemical and consumer goods company reported a 13.7% decline in its adjusted operating earnings in 2022.
HelloFresh SE decreased 6.9% to €21.16 after the meal-kit maker estimated lower-than-expected core profit in 2023.
Ashtead Group plc increased 3.3% to 5,936.0 pence after the UK-based equipment rental company said annual results are likely to surpass its own estimate.
Zalando SE increased 3.4% to €40.15 after the online marketplace operator said it plans to focus on improving its operating margins and eliminate unnecessary costs.
John Wood Group Plc increased 14.3% to 221.80 pence after the UK-based engineering company said it is likely to reject the latest buyout proposal from the private equity group Apollo Global Management.
Greggs Plc declined 0.7% to 2,732.0 pence after the bakery and fast food chain said that the company is facing inflationary cost pressures.
Tech Rally Lost Steam After U.S. Treasury Yields Rebounded
Barry Adams
06 Mar, 2023
New York City
Morning's tech rally fizzled after Treasury yields and energy prices rebounded and the familiar worries of hard or soft landing reemerged.
Market nervousness persisted ahead of the two-day congressional testimony of the Federal Reserve chairman Jerome Powell starting Tuesday.
Investors are divided in two camps, one favoring the interest rate to pause as early as this summer and the second hoping that the Fed will moderate future rate hikes.
Despite the eight interest rate increase over the last twelve months, the inflation is not cooling fast enough and significantly higher than the Fed's preferred level of 2%.
Stocks advanced in morning trading ahead of the release of economic data on employment and comments from the Federal Reserve but the rebound in the Treasury yields cooled the market sentiment and rate worries dominated.
Economic reports on the U.S. labor market and jobless rate survey are expected to impact market sentiment later in the week.
Federal Reserve Chairman Jerome Powell is scheduled to offer his views to congressional lawmakers and investors on Tuesday and Wednesday.
The U.S. Labor Department is scheduled to release the February jobs report on Friday and economists polled by Ticker.com are estimating net payroll additions between 265,000 and 295,000.
January's payrolls increase by 517,000 is viewed by most economists as an anomaly, despite the tight labor market conditions.
The U.S. labor market is expected to add less than 260,000 jobs a month, slower than 401,000 in 2022 and 600,000 in 2021.
Investors are looking ahead to the release of the Euro Area GDP data and comments from the European Central Bank policymakers.
Crude oil traded with a downward bias after China forecasted a modest increase in economic growth in 2023.
New Orders for Factory Goods Declined In January
New orders for manufactured goods in January fell $8.9 billion or 1.6% to $542.8 billion, following the downwardly revised 1.7% rise, the U.S. Census Bureau reported Monday.
New orders declined in two of the last three months but shipments declined for the third month in a row in January by 0.7% following the fall by 0.6%.
China Sets Modest Economic Growth Target In 2023
China lowered its economic growth target in 2023 to 5% after missing the 5.5% in the previous year.
China's economy expanded at 3.3% in 2022 and is likely to advance at a slower pace on the weak export growth and falling property prices.
Outgoing Premier Li Keqiang announced the target rate at the annual legislative conference on Sunday and the party officials focused on reviving growth through other measures.
Indexes & Yields
The S&P 500 index increased 0.7% to 4,072.31 and the Nasdaq Composite index added 1.0% to 11,805.63.
The yield on 2-year Treasury notes edged lower to 4.89%, 10-year Treasury notes to 3.98% and 30-year Treasury bonds eased to 3.91%.
Crude oil advanced for the fifth session in a row and increased 94 cents to $80.62 a barrel and natural gas eased 40 cents to $2.60 a thermal unit.
Natural gas futures plunged 14% following the milder weather forecast for the next two weeks.
The price of the energy product fell from the five-week high of $3 a thermal unit last week after LNG shipments resumed from the Freeport, Louisiana terminal following a shutdown since June 2022 after a fire broke out.
Altria Agreed to Acquire e-Cigarettes Maker NJOY
Altria Group Inc increased 1.1% to $47.04 after the maker of Marlboro cigarettes agreed to acquire e-cigarette company NJOY for $2.785 billion.
Altria recently sold its stake in the troubled e-cigarettes maker Juul Labs, which was once valued at $13 billion in 2018 and the company's products are still facing several investigations from the Food & Drugs Administration.
The U.S. FDA has approved six of the NJOY's vaping products for sale.
Stock Movers
Snap Inc gained 13% to $12.03 as the U.S. lawmakers make progress in advancing a bill to provide an authority to President Joe Biden in banning TikTok, the company's main competitor.
Credit Suisse declined 0.7% to $3.01 after the company's main shareholder Harris Associates sold its entire stake in the company.
The news was first reported by the Financial Times and independently verified by Ticker.com.
Chicago-based Harris Associates reportedly owned as much as 10% last year but sold its entire stake in the last two months.
"There is a question about the future of the franchise. There have been large outflows from wealth management," deputy chair and chief investment officer David Hero said to Financial Times.
Ciena Corporation rose 4% to $51.14 after the networking equipment maker reported revenue in the last quarter increased 25.1% to $1.06 billion from $844.44 million a year ago.
Net income increased to $76.24 million or $0.51 per share from $45.82 million or $0.29 per share in the prior-year quarter.
European Markets Hover Near 1-year New Highs, CAC-40 Closed at Record High
European market indexes advanced and investors looked ahead to a busy week of economic reports and a fresh batch of corporate earnings.
Energy explorers and resource stocks closed lower following the weakness in crude oil and natural gas prices after China lowered its economic growth target in 2023.
European indexes are expected to trade volatile as investors look ahead to India's money supply growth, foreign exchange reserves and industrial production data, U.S. jobs market and the Euro Area GDP data later in the week.
Investors will also review comments from the U.S. Federal Reserve and the European Central Bank policy makers during the week.
Euro Area Retail Sales Eased
On the economic front, the Euro Area retail sales rose less than expected in January, Eurostat reported on Monday.
Retail sales in January rose 0.3% after falling 1.7% in December on a monthly basis.
On an annual basis, retail sales decline eased to 2.3% at the start of the year after falling 2.8% in December.
The weaker-than-expected retail sales suggested that consumers are still struggling under the high prices of food and energy.
Food, drinks and tobacco sales rose 1.8% after a 2.1% decline and non-food product sales rose 0.8% after falling 2.5%.
Automotive fuel sales fell 1.5% reversing a 0.5% increase in the prior month.
UK new car registration increased for the seventh month in a row on the sustained demand for electric vehicles, the Society of Motor Manufacturers and Traders reported Monday.
Passenger vehicle sales increased 26.2% in February from 14.7% rise in January and new car registration increased to 74,441 units from 58,994 a year ago.
The 7-month sustained rebound in vehicle sales lifted automobile registration and approached the pre-pandemic 2020 registration in the corresponding month.
Vehicle registrations were only 6.5% lower than February 2020.
China Sets Modest Economic Growth Target In 2023
China lowered its economic growth target in 2023 to 5% after missing the 5.5% in the previous year.
China's economy expanded at 3.3% in 2022 and is likely to advance at a slower pace on the weak export growth and falling property prices.
Outgoing Premier Li Keqiang announced the target rate at the annual legislative conference on Sunday and the party officials focused on reviving growth through other measures.
Indexes & Yields
The DAX index increased 0.2% to 15,615.14, the CAC-40 index added 0.1% to 7,358.28 and the FTSE 100 index decreased 0.6% to 7,901.03.
The yield on the 10-year German Bunds edged lower to 2.66%, French bonds eased to 3.2%, the UK gilts to 3.8% and Italian bonds to 4.4%.
The euro inched higher to $1.06, the British pound edged higher to $1.20 and the Swiss franc to 93.48 U.S. cents.
Brent crude oil decreased $1.05 to $84.77 a barrel and the Dutch TTF natural gas futures dropped Є2.14 to Є42.85 per MWh.
Europe Movers
Telecom Italia SpA increased 3% to €0.32 after Italian state investor CDP and Australia's private equity and asset management group Macquarie submitted a joint bid to acquire the company's fixed-network business.
Eni SpA added 0.7% to €13.52 after the Italian company struck a deal with Abu Dhabi National Oil Company in deepening their ties in reducing emissions and producing clean energy.
Clarkson PLC increased 5.5% to 3,485.0 pence after the U.K.-based shipping services provider reported a rise in 2022 earnings.
Resource stocks traded lower after Brent crude declined 1.1% and natural gas dropped 4.8% and base metal prices fell around 1%.
Glencore, Antofagasta and Anglo American declined between 1% and 3%.
James Fisher & Sons plc declined 4.6% to 372.50 pence after the U.K.-based company agreed to sell its nuclear decommissioning business for nominal consideration and established a new intercompany credit agreement.
Tech Surge Leads Nikkei Higher In Japan
The Nikkei 225 index increased 1.1% to 28,237.78 after tech stocks rallied following the gains in the U.S. tech stocks after Treasury yields closed lower In Friday's trading.
SoftBank Group led the gainers with a rise of 3.1%, Tokyo Electron jumped 2.7%, Lasertec gained 1.8%, Renesas Electronics advanced 2.7% and Keyence increased 1.9%.
The yield on 10-year Japanese government bonds held firm at 0.5% ahead of the last Bank of Japan's meeting on Friday under the leadership of Haruhiko Kuroda.
Stocks Turn Lower In China On Falling Stimulus Expectations
The Shanghai Composite Index fell 0.2% and the Hang Seng index added 0.2% to 20,603.19 after China projected a modest economic growth in 2023.
Tech stocks declined sharply in Hong Kong's trading after the modest economic growth projection dashed hopes of additional government stimulus.
Country Garden Services dropped as much as 10% but recovered to a loss of 2.7% to HK$15.60 after the company issued a profit warning.
Optimism Lifted India Stocks
Stocks in Mumbai closed at 2-week highs after the service sector expanded at the fastest pace in 12 years.
The Sensex index increased 0.7% or 415.49 and the Nifty index added 0.7% or 117.10 points to 17,711.45.
Of the stocks traded on the Bombay Stock Exchange 102 stocks closed at new 52-week highs and 170 closed at new 52-week lows.
The yield on 10-year Indian government bonds hovered near 7.42% and the Indian rupee edged higher to ₹81.88 against the U.S. dollar.
Adani Group stocks rebounded after a vote of confidence from the investment managers at the Life insurance Corporation and other U.S. investment groups.
Europe Movers: Clarkson, Eni, James Fisher & Sons, Resource Stocks, Telecom Italia
Bridgette Randall
06 Mar, 2023
Frankfurt
Telecom Italia SpA increased 3% to €0.32 after Italian state investor CDP and Australia's private equity and asset management group Macquarie submitted a joint bid to acquire the company's fixed-network business.
Eni SpA added 0.7% to €13.52 after the Italian company struck a deal with Abu Dhabi National Oil Company in deepening their ties in reducing emissions and producing clean energy.
Clarkson PLC increased 5.5% to 3,485.0 pence after the U.K.-based shipping services provider reported a rise in 2022 earnings.
Revenue in 2022 increased to £603.8 million from £443.3 million and reported profit before-tax increased to £100.1 million from £69.1 million in the previous year.
Basic earnings per share in 2022 increased to 247.9 pence from 164.6 pence and the integrated shipping services provider increased its annual dividend for the 20th year in a row to 93 pence from 84 pence in the previous year.
Resource stocks traded lower after Brent crude declined 1.1% and natural gas dropped 4.8% and base metal prices fell around 1%.
Glencore, Antofagasta and Anglo American declined between 1% and 3%.
James Fisher & Sons plc declined 4.6% to 372.50 pence after the U.K.-based company agreed to sell its nuclear decommissioning business for nominal consideration and established a new intercompany credit agreement.
Credit Suisse declined 0.7% to $3.01 after the company's main shareholder Harris Associates sold its entire stake in the company.
The news was first reported by the Financial Times and independently verified by Ticker.com.
Chicago-based Harris Associates reportedly owned as much as 10% last year but sold its entire stake in the last two months.
"There is a question about the future of the franchise. There have been large outflows from wealth management," deputy chair and chief investment officer David Hero said to Financial Times.
New Orders for Manufactured Goods Declined 1.6% In January
Brian Turner
06 Mar, 2023
New York City
New orders for manufactured goods in January fell $8.9 billion or 1.6% to $542.8 billion, following the downwardly revised 1.7% rise, the U.S. Census Bureau reported Monday.
New orders declined in two of the last three months but shipments declined for the third month in a row in January by 0.7% following the fall by 0.6%.
Unfilled orders increased $0.3 billion or virtually unchanged to $1,157.0 billion following a 1.1% December increase.
Unfilled orders increased for the twenty-ninth months in a row in January and the unfilled orders-to-shipments edged up 6.07, up from 6.06 in December.
Inventories increased $0.4 billion or virtually unchanged to $808.3 billion following a 0.4% increase in December.
Inventories rose for the fifth month in a row and the inventories-to-shipments ratio slightly decreased to 1.48 from 1.49 in December.
Durable goods orders in January were unrevised at 4.5% in January to $272.4 billion, following a 5.1% increase in December.