Market Update
Recession Worries Resurface After Latest Earnings
Barry Adams
21 Jul, 2022
New York City
Benchmark indexes on Wall Street lacked direction after trading near 6-week highs as investors digested the latest earnings from home builders and transportation companies.
The S&P 500 index fell 0.7% to 3,931.47 and the Nasdaq Composite index fell 0.7% to 11,821.90
Futures of crude oil declined $3.27 to $96.41 a barrel and natural gas rose 32 cents to $7.68 a unit.
Heatwave in the U.S. and Europe lifted prices of natural gas and Russia resumed its natural gas supply to Europe through Nord Stream 1 pipe network.
The yield on 10-year Treasury notes edged lower to 2.98% and the yield on German government 10-year Bund hovered near 1.246% after the European Central Bank lifted rates for the first time in eleven years.
The yield on Japanese government bonds were nearly unchanged after the Bank of Japan left its key lending rate unrevised at 0.25%.
D.R. Horton fell 3.3% to $70.74 after the home builder said June quarter sales increased 21% to $8.8 billion and net income surged 48% to $1.6 billion or $4.67 a share from a year ago.
The home builder also lowered its full-year outlook on moderating demand to a range between $33.8 billion to $34.6 billion and complete between 83,000 and 85,000 homes.
The company had previously guided annual revenues to fall between $35.3 billion to $36.1 billion and complete between 88,000 and 90,000 homes.
American Airlines Group declined 7.8% to $14.02 after the company reported its first quarterly profit since the start of the pandemic.
The airline reported record second quarter revenue of $13.4 billion, a 12.2% increase over the same period in 2019 on 8.5% less capacity.
Second quarter net income was $476 million or $0.68 per diluted share.
Carnival Corp dropped 12.3% to $9.70 after the cruise line operator planned a $1 billion common stock offering to finance general corporate expenses.
Tesla Inc gained 6.2% to $788.23 after the electric vehicle maker reported quarterly sales jumped 42% and net income doubled from a year ago.
First Rate Hike in Eurozone After 11 Years, Draghi Resigns
European markets traded mixed after the central bank lifted rates for the first time in eleven years and Italian political turmoil deepened.
The DAX index eased 0.17% to 13,257.90, the CAC-40 index rose 0.6% to 6,220.59, and the FTSE 100 index decreased 0.4% to 7,234.52.
The European Central Bank lifted its key lending rate by 50 basis points to cool rapidly advancing inflation in the currency zone of 19 nations.
The governing council lifted the rates more than the 25 basis points of increase expected by traders and economists.
With the latest increase, the key lending rate is zero and the central bank had previously signaled rate hikes at the next meetings in July and September.
The deposit rate is now set at zero, the main refinancing rate at 0.50%, and the marginal lending facility is 0.75%.
The euro strengthened after the rate decision to $1.0245.
ECB Lifts Rates for the First Time in 11 Years
Brian Turner
21 Jul, 2022
New York City
European markets traded mixed after the central bank lifted rates for the first time in eleven years and Italian political turmoil deepened.
The DAX index eased 0.17% to 13,257.90, the CAC-40 index rose 0.6% to 6,220.59, and the FTSE 100 index decreased 0.4% to 7,234.52.
The European Central Bank lifted its key lending rate by 50 basis points to cool rapidly advancing inflation in the currency zone of 19 nations.
The governing council lifted the rates more than the 25 basis points of increase expected by traders and economists.
With the latest increase, the key lending rate is zero and the central bank had previously signaled rate hikes at the next meetings in July and September.
The deposit rate is now set at zero, the main refinancing rate at 0.50%, and the marginal lending facility is 0.75%.
The euro strengthened after the rate decision to $1.0245.
The central bank reiterated its commitment to bring down the inflation rate to its target rate of 2% as supply constraints and rising energy prices lifted June inflation to 8.6%.
"We expect inflation to remain undesirably high for some time, owing to continued pressures from energy and food prices and pipeline pressures in the pricing chain," the accompanying statement noted.
The ECB also said that the "inflation continues to be undesirably high and is expected to remain above our target for some time. The latest data indicate a slowdown in growth, clouding the outlook for the second half of 2022 and beyond."
With the diverging interest rates in the eurozone and heightened political turmoil in Italy, the central bank released a new tool to offer additional lending facilities with stringent conditions in the event of severe bond market conditions.
The anticipatory move is expected to keep the smooth functioning of the eurozone bond markets and the details of the terms and conditions are scheduled to be released later today at 3:45 p.m. Frankfurt time.
The yield on the 10-year Italian government bonds shot up to 3.6014% after Prime Minister Mario Draghi offered his resignation.
Draghi will continue as a "caretaker" prime minister until the president Sergio Mattrarella decides next steps.
Draghi decided to resign after three coalition partners - the center right parties The League and Forza Italia and the populist 5-Star Movement - withdrew its support to the 17-month old national unity government..
Tesla Net Income Doubles On 42% Rise In Sales
Scott Peters
20 Jul, 2022
New York City
Tesla said production and deliveries of vehicles gained despite the extended shutdowns at its facility in China and sales and profit soared in the three months to June.
Tesla June quarter sales increased 42% to $16.9 billion from $11.96 billion a year ago.
Net income rose rose 98% to $2.26 billion from $1.14 billion a year ago and diluted earnings per share jumped to $1.95 from $1.02 a year ago.
Automotive gross margin declined, but still healthy, to 27.9% from 28.4% a year ago.
Free cash flow in the quarter was nearly unchanged at $621 million from a year ago.
On a sequential basis, second quarter profit declined to $2.3 billion from the record $3.3 billion in the first quarter on the rising raw materials costs and parts shortages.
In the second quarter, Tesla production increased 25% to 258,580 vehicles and deliveries rose 27% to 254,695 vehicles, despite ongoing supply chain challenges and factory shutdowns beyond the company's control.
Store and service locations increased 19% to 709 from 598 a year ago.
June 2022 was the highest vehicle production month in Tesla
S&P 500 Closes at 5-week High, Rapid Decline in Housing Market
Barry Adams
20 Jul, 2022
New York City
U.S. stocks advanced and investors digest the latest batch of earnings and housing market indicators flashed red signals ahead.
The S&P 500 index increased 0.6% to 3,959.90 and the Nasdaq Composite index advanced 1.6% to 11,897.65.
The popular averages rose to five-week highs as the earnings season picks up momentum.
Futures of crude oil decreased $1.61 to $102.65 a barrel and natural gas increased 63 cents to $7.89 a unit.
The yield on 10-year Treasury notes increased to 3.034%.
Mortgage Demand Drops to 22-year Low
Mortgage demand plunged to the lowest levels in 22 years, according to data released by the Mortgage Bankers Association.
The Market Composite index, tracking the mortgage loan application volume, dropped 6.3% on a seasonally adjusted basis for the week ending July 15.
On an unadjusted basis, the index declined 17% on a weekly basis.
The refinance indexes declined 4% from a week ago and plunged 80$ from a year ago.
Rising home prices and a surge in mortgage rates have drained considerable purchasing power from home buyers.
The average contract interest rate for 30-year fixed-rate mortgages with 20% down payment and loan balances less than $647,200 increased to 5.82% from 5.74%, with points increasing to 0.65 from 0.59 including the origination fee.
Existing Home Sales Drops Below 2019 Level
Existing home sales declined 5.4% in June from May, the National Association of Realtors said in its monthly report today.
June existing home sales declined to a seasonally adjusted rate of 5.12 million units, a fall of 14.2% from a year ago, the industry group said in its report.
Home sales were the slowest since January 2019 outside of the sales decline during the onset of the coronavirus pandemic during the same month in 2020 and below the total 2019 sales before the pandemic.
Stocks advanced on Wall Street on the earnings optimism and investors looked ahead to results from at least 100 more companies this week.
Movers: Bakers Hughes, Bath & Bodyworks, Netflix, Tesla
Netflix increased 7.3% to $216.40 after the steaming services provider reported fewer than expected subscriber losses.
In the second quarter, Netflix lost 970,000 subscribers, less than the previous estimate of 2 million. Moreover, earnings were ahead of expectations.
Baker Hughes dropped 8.2% to $25.89 after the oil field services company reported sharply lower than expected earnings.
Tesla gained 0.6% to $747.0 after the vehicle maker reported June quarter sales increased 42% to $16.9 billion from $11.96 billion a year ago.
Net income rose rose 98% to $2.26 billion from $1.14 billion a year ago and diluted earnings per share jumped to $1.95 from $1.02 a year ago.
Automotive gross margin declined, but still healthy, to 27.9% from 28.4% a year ago.
Free cash flow in the quarter was nearly unchanged at $621 million from a year ago.
In the second quarter, Tesla produced over 258,000 vehicles and delivered over 254,000 vehicles, despite ongoing supply chain challenges and factory shutdowns beyond the company's control.
June 2022 was the highest vehicle production month in Tesla
Movers: Baker Hughes, Bath & Body Works, Nasdaq, Netflix, Tesla
Barry Adams
20 Jul, 2022
New York City
U.S. stocks advanced and investors digest the latest batch of earnings and housing market indicators flashed red signals ahead.
The S&P 500 index increased 0.6% to 3,959.90 and the Nasdaq Composite index advanced 1.6% to 11,897.65.
Futures of crude oil decreased $1.61 to $102.65 a barrel and natural gas increased 63 cents to $7.89 a unit.
The yield on 10-year Treasury notes increased to 3.034%.
Netflix increased 7.3% to $216.40 after the steaming services provider reported fewer than expected subscriber losses.
In the second quarter, Netflix lost 970,000 subscribers, less than the previous estimate of 2 million. Moreover, earnings were ahead of expectations.
Baker Hughes dropped 8.2% to $25.89 after the oil field services company reported sharply lower than expected earnings.
Tesla gained 0.6% to $747.0 after the vehicle maker reported June quarter sales increased 42% to $16.9 billion from $11.96 billion a year ago.
Net income rose rose 98% to $2.26 billion from $1.14 billion a year ago and diluted earnings per share jumped to $1.95 from $1.02 a year ago.
Automotive gross margin declined, but still healthy, to 27.9% from 28.4% a year ago.
Free cash flow in the quarter was nearly unchanged at $621 million from a year ago.
Bath & Body Works, Inc increased 3.0% to $21.25 after the personal care retailer lowered its outlook for the second quarter and full-year.
The company currently expects second quarter sales to be down six to seven percent from the last year compared to its previous guidance for a low single digit percent increase from 2021.
The company lowered its second quarter earnings from continuing operations per diluted share to between $0.40 and $0.42 from its previous estimate of $0.60 to $0.65.
The company lowered its full year sales to be down mid-to-high-single digits from a year ago compared to its previous guidance of a low-single digit percent increase from 2021.
Nasdaq Inc rose 6.1% to $169.04 after the exchange operator said second quarter revenues increased 6% to $893 million.
Net income in the June quarter declined 10% to $307 million or $1.85 a share from $341 million or $2.05 a share a year ago.
European Markets Fall, Draghi Survives Confidence Vote but Coalition Breaks
Bridgette Randall
20 Jul, 2022
New York City
European markets traded higher after Italian Prime Minister Mario Draghi told lawmakers in the upper house of the parliament that he will continue to lead the nation if he wins the confidence vote.
Later in the afternoon, Draghi won the confidence vote but three parties boycotted the vote.
Despite Draghi's calls for unity earlier in the day, 5-Start Movement, Forza Italia, and League boycotted the election prompting stark rebuke from several leaders.
"On this day of madness, Parliament decided to go against Italy," tweeted former Prime Minister Enrico Letta.
Draghi is set to address lawmakers in the lower house of parliament tomorrow.
Draghi's commitment to stay in the office comes at a crucial time for Italy as the nation needs to finalize its annual budget and pass reforms in the next few weeks ahead of receiving the next tranche of post-pandemic funding of 20 billion euros from the European Union.
Last week, Draghi offered his resignation to Italian president after bickering coalition partner Five Star Movement pulled its support ahead of confidence vote,
Draghi's resignation prompted a huge outpouring of public support urging him to stay in the office and lead the nation. Draghi was appointed in the office 17 months ago.
The DAX index fell 0.2% to 13,281.98, the CAC-40 eased 0.3% to 6,184.66, and the FTSE 100 index dropped 0.44% to 7,264.31.
Royal Mail Plc declined 1.8% to 279.87 pence after the U.K.-based mail service provider said fiscal first year revenues declined 11.5% from a year ago to 11.5 billion pounds.
Group revenues, including GLS N.V., dropped 5.1% to 2.998 billion pounds.
Parcels shipped in the June quarter declined 15% to 314 million from 371 million a year ago.
ASML Holding NV gained 3.4% to 501.20 euros after the semiconductor equipment maker trimmed its fiscal full-year 2022 outlook.
Uniper SE increased 12.8% to 11.72 euros after the German utility is nearing an agreement to sell a stake to the German government in exchange for a bailout package.
The news was first reported by Bloomberg News and independently verified by Ticker.com
Asian markets broadly closed higher on the receding worries that China's campaign against tech companies may be nearing end.
The Nikkei index soared 2.7% to 27,680.27, the Hang Seng index added 1.1% to 20,890.22, and the Sensex index jumped 1.2% to 55,397.53.
The People's Bank of China held its key lending rate for five-year loans at 4.45% as mortgage boycotts are spreading across the nation.
The central bank lowered its rate by 15 basis points in May and by 5 basis points in January.
Nasdaq Jumps 1%, Netflix Soars 7%
Barry Adams
20 Jul, 2022
New York City
U.S. stocks advanced and investors digest the latest batch of earnings.
The S&P 500 index increased 0.8% to 3,869.45 and the Nasdaq Composite index advanced 1.8% to 11,925.83.
Futures of crude oil decreased 72 cents to $103.45 a barrel and natural gas increased 15 cents to $7.42 a unit.
The yield on 10-year Treasury notes increased to 3.038%.
Mortgage demand plunged to the lowest in 22 years, according to the data released by the Mortgage Bankers Association.
Stocks advanced on Wall Street on the earnings optimism and investors looked ahead to results from at least 100 more companies this week.
Netflix increased 7.3% to $216.20 after the steaming services provider reported fewer than expected subscriber losses.
In the second quarter, Netflix lost 970,000 subscribers, less than the previous estimate of 2 million. Moreover, earnings were ahead of expectations.
Baker Hughes dropped 8.01% to $25.98 after the oil field services company reported sharply lower than expected earnings.
European markets traded higher after Italian Prime Minister Mario Draghi told lawmakers in the upper house of the parliament that he will continue to lead the nation if he wins the confidence vote.
Draghi is set to address lawmakers in the lower house of parliament tomorrow.
Draghi's commitment to stay in the office comes at a crucial time for Italy as the nation needs to finalize its annual budget and pass reforms in the next few weeks ahead of receiving the next tranche of post-pandemic funding of 20 billion euros from the European Union.
Last week, Draghi offered his resignation to Italian president after bickering coalition partner Five Star Movement pulled its support ahead of confidence vote,
Draghi's resignation prompted a huge outpouring of public support urging him to stay in the office and lead the nation. Draghi was appointed in the office 17 months ago.
The DAX index fell 0.2% to 13,287.91, the CAC-40 eased 0.1% to 6,194.13, and the FTSE 100 index dropped 0.4% to 7,264.33.
Asian markets broadly closed higher on the receding worries that China's campaign against tech companies may be nearing end.
The Nikkei index soared 2.7% to 27,680.27, the Hang Seng index added 1.1% to 20,890.22, and the Sensex index jumped 1.2% to 55,397.53.
The People's Bank of China held its key lending rate for five-year loans at 4.45% as mortgage boycotts are spreading across the nation.
The central bank lowered its rate by 15 basis points in May and by 5 basis points in January.
Wall Street Rally Gathers Momentum After Fresh Batch of Earnings
Barry Adams
19 Jul, 2022
New York City
Rally on Wall Street gathered momentum as investors warmed up to the latest batch of earnings.
Corporate earnings generally matched expectations set by analysts and companies are facing strong headwinds from the rising U.S. dollar.
The S&P 500 index increased 2.5% to 3,927.48 and the Nasdaq Composite index advanced 2.9% to 11,688.64.
Twitter gained 3.8% to $39.86 after the social media platform operator won a motion to expedite trial to force investor Elon Musk to complete purchase and satisfy the acquisition terms.
European Markets Rebound to Close Up 2%
Bridgette Randall
19 Jul, 2022
New York City
European markets advanced amid mixed economic reports in the region and rising hopes that the natural gas flow will resume this week from Russia.
Eurozone inflation accelerated in June according to the final data released by the Eurostat on Tuesday. The final data matched the flash estimate.
The harmonized Index of consumer prices in June increased 8.6% on a yearly basis, faster than the 8.1% rise in May, final data from Eurostat showed on Tuesday.
The eurozone construction output increased 0.4% in May from April when the output was revised to a decline of 1.0% from the previous estimate of 1.1% decline, the Eurostat reported on Tuesday.
On a yearly basis construction output increased to 2.9% in May from 2.8% in April.
The UK unemployment remained unchanged in the three months to May, according to the Office of National Statistics on Tuesday.
The jobless rate was 3.8% at the end of the three-month period to May matching the rate for the period ending in April.
The DAX index surged 2.7% to 13,308.41, the CAC-40 index soared 1.8% to 6,201.22, and the FTSE 100 index gained 1.01% to 7,296.28.
The euro rebounded to a two-week high of $1.0236.
Novartis AG increased 3.7% to 83.32 swiss francs after the drug maker said it no longer expects its Sandoz division.
Telenor ASA declined 0.8% to 12.40 euros after the Norwegian telecom operator reported a second quarter loss of 1.1 billion kroner compared to 2.19 billion kroner a year ago.
Electricite de France soared 14.7% to 11.73 euros after the French government offered 12 euros a share to acquire the remaining stake in the nuclear power utility company and nationalize the Europe's largest nuclear power utility.
The buyout offer of 9.7 billion euros is expected to be completed before the year's end.
Alstom SA declined 2.6% to 24.14 euros and said sales in the fiscal year first quarter ending in June increased 8% to 4.0 billion euros and booked 5.6 billion euros of new orders, increasing the order book to 83.4 billion euros.
The company cited supply chain issues and rising input costs may impact profitability and guided dividend payout ratio between 25% and 35%.
Kier Group increased 2.5% to 77.20 pence after the construction services company reiterated its full-year outlook.
China's Cash Crisis Prompts Central Bank Action
Arjun Pandit
19 Jul, 2022
New York City
Asian stocks edged lower as investors worried about the growing cash crisis with Chinese banks.
The People's Bank of China injected more liquidity in the banking system after a growing number of regional and provincial banks restricted cash withdrawals for retail customers and the U.S. dollar withdrawal for corporations.
Agricultural Bank of China, Shanghai Pudong Bank, and ICBC are restricting customer withdrawals.
Mortgage boycotts are widening in China as more buyers demand the delivery of promised homes on time.
Home owners are increasingly organizing street protests in several second-tier and third-tier cities across China as authorities crackdown on social media dissent.
Hong Kong's Hang Seng Index declined 0.9% to 20,661.06 as the central bank took steps to shore up confidence in the housing market and prevent the cash crisis to engulfing a wider list of banks.
The Nikkei 225 Index gained 0.7% to 26,961.68 after a 3-day weekend ahead of the Bank of Japan meeting later in the week.
Heavy equipment makers rose in trading after the Nikkei reported that the Japanese government is likely to remove a cap on defense spending from the next fiscal year..
Mitsubishi Heavy Industries gained 2.5% and Kawasaki Heavy Industries jumped 5.2%.
The Kospi edged down 0.2% to close at 2,370.97 on the worries that the central bank will lift rates higher and faster and the rate path may drive the economy into a recession.
The Sensex in Mumbai closed higher 0.5% to 54,767.52 in a late rally on the earnings optimism and the rising demand for vehicles after the strong start of the monsoon season.
IBM Revenue Growth Hit by Strong Dollar
Scott Peters
18 Jul, 2022
New York City
IBM revenues in the quarter rose and earnings surged despite the headwinds from a strong dollar.
However, the tech company tightened its free cash flow outlook for the year.
IBM said second quarter revenues increased 9% to $15.5 billion.
Net income rose to $1.39 billion or $1.61 a diluted share from $1.33 billion or $1.47 a share.
Net income from continuing operations surged 81% to $1.5 billion or $1.61 a diluted share from $810 million or $0.90 a share.
Software revenues increased 6% to $6.17 billion, consulting revenues rose 10% to $4.81 billion, and infrastructure revenues rose 19% to $4.24 billion.
Hybrid cloud revenues surged 16% to $21.7 billion in the past 12 months.
Gross margin in the quarter declined to 53.4% from 55.2% in the quarter a year ago and said consulting unit margin faced headwind on the rising costs of talent.
IBM
Morning Rally Turns Afternoon Losses On Wall Street
Barry Adams
18 Jul, 2022
New York City
Stocks turned lower in the afternoon and Bank of America and Goldman Sachs reported better than expected quarterly results.
The S&P 500 index decreased 0.8% to 3,830.85 and the Nasdaq Composite index fell 0.8% to 11,360.06.
Futures of crude oil prices increased $4.53 to $102.09 and natural gas advanced 43 cents to $7.44 a unit.
The yield on 10-year U.S. Treasury notes increased to 2.98%.
Market sentiment turned negative after Goldman said it is looking to reinstate job cuts at the end of the year and a report suggested Apple plans to slow hiring, joining other tech companies in looking to curtail hiring.
Goldman Sachs gained 2.6% to $301.26 after the financial services company said a surge in bond trading revenues helped to offset the weakness in investment banking revenues in the latest quarter ending in June.
Revenues in the quarter declined 26% to $11.86 billion and net income fell 47% to $2.9 billion or $7.73 a diluted share from $5.4 billion or $15.02 a share a year ago.
Goldman lifted its quarterly dividend to $2.50 a share in the third quarter.
Bank of America increased 0.1% to $32.34 after the lender benefited from the rising rate environment.
Revenues, net of interest expenses, increased 6% to $22.7 billion and net income declined to $5.9 billion or 73 cents a diluted share from $8.9 billion or $1.03 a diluted share.
The bank also took a charge of $523 million for the provision of credit losses.
Investors are also awaiting earnings this week from 135 companies including Tesla, Netflix, United Airlines, Union Pacific, Johnson & Johnson, and Verizon.
Boeing Co increased 4.5% to $154.60 after Delta Airlines placed an order for 100 737 MAX 10 jets.
"The aircraft will be 20%-30% more fuel efficient than the retiring Delta planes," Delta added in a press statement released at the signing ceremony at the 2022 Farnborough International Airshow.
Nearly one-third of the aircraft
Bank of America Revenues Rise on Strong Consumer, Profit Falls On Weak Business Deals
Scott Peters
18 Jul, 2022
New York City
Bank of America said its latest quarterly results benefited from the rising rate environment.
Bank of America said revenues in the second quarter ending in June net of interest expenses, increased 6% to $22.7 billion.
Net income declined to $5.9 billion or 73 cents a diluted share from $8.9 billion or $1.03 a diluted share.
The bank also took a charge of $523 million for the provision of credit losses.
Total loans and leases at the end of the quarter increased to $1.03 trillion from $918 billion a year ago.
Total deposits increased to $1.989 trillion from $1.909 trillion a year ago.
Non-performing loans declined to $4.1 billion or 0.41% loan loss ratio from $4.9 billion or 0.54% ratio from a year ago.
Consumer Banking
Consumer banking segment revenues increased 12% to $9.1 billion but net income declined 5% to $2.9 billion.
Net income was impacted by higher credit loss provision of $350 billion on loan growth and dampened macroeconomic outlook.
At the end of the quarter, the bank added 241,000 net new consumer accounts totaling 35.1 million and business accounts increased 5% to 3.7 million.
Account balances increased 4% to $1.6 trillion and combined credit and debit card spending increased 10% to $221 billion, 17% increase in credit card and 6% in debit card spending.
Average credit card outstanding balance increased to $81.0 billion from $73.4 billion a year ago.
Global Wealth and Investment Management
Revenues increased 7% to $5.4 billion on higher interest rates and higher balances.
Assets under management decreased 8% to $3.4 trillion reflecting lower market valuation and offset by new asset flows of $53 billion.
Merrill Lynch wealth management unit added 4,500 new household clients and client balances were $2.8 trillion with $1.1 trillion in assets under management.
Total investment banking fees decreased 47% or $994 million to $1.1 billion.
Global Banking
Revenues decreased 2% to $5.0 billion reflecting lower investment banking fees, mark-to-market losses related to leveraged finance positions and lower leasing-related revenue.
These were partially offset by higher net interest income from the benefit of higher interest rates and strong loan growth.
Total investment banking fees (excl. self-led) decreased $994 million, or 47%, to $1.1 billion.
Global Markets
Revenues decreased 5% to $4.5 billion reflecting lower investment banking fees and mark-to-market losses related to leveraged finance positions, partially offset by higher sales and trading revenue.
Sales and trading revenue increased 17% to $4.2 billion driven by 19% increase in fixed income, commodities and currencies trading to $2.3 billion and 2% rise in equities trading to $1.7 billion.
Company and Stock
Bank of America increased 1.1% to $32.64 and extended this year's loss to 30.1%.
Bank of America operates 3,984 centers and the bank's investment units has 650 research analysts covering 3,400 companies, 1,140 corporate bond issuers across 56 economies and 24 industries.
Movers: Bank of America, Boeing, Coinbase, Delta, Goldman Sachs, IBM
Barry Adams
18 Jul, 2022
New York City
Bank of America increased 1.1% to $32.64 after the lender benefited from the rising rate environment.
Revenues, net of interest expenses, increased 6% to $22.7 billion and net income declined to $5.9 billion or 73 cents a diluted share from $8.9 billion or $1.03 a diluted share.
The bank also took a charge of $523 million for the provision of credit losses.
Boeing Co increased 4.5% to $154.60 after Delta Airlines placed an order for 100 737 MAX 10 jets.
Coinbase Global increased 16.2% to $62.49 after the Norway based DNB Asset Management purchased share of the cryptocurrency exchange.
DNB initiated position in the company with 13,641 shares in the second quarter, according to a regulatory filing with the SEC.
Delta Air increased 5.4% to $31.70 after the airlines placed its first plane order in about a decade.
"The aircraft will be 20%-30% more fuel efficient than the retiring Delta planes," Delta added in a press statement released at the signing ceremony at the 2022 Farnborough International Airshow.
Nearly one-third of the aircraft
U.S. Stocks Advance Ahead of Busy Week of Earnings, Goldman Sachs and Bank of America Rise
Barry Adams
18 Jul, 2022
New York City
Stocks on Wall Street advanced and Bank of America and Goldman Sachs reported better than expected earnings.
The S&P 500 index increased 0.8% to 3,896.20 and the S&P 500 index advanced 1.2% to 11,589.56.
Futures of crude oil prices increased $4.23 to $101.86 and natural gas advanced 39 cents to $7.39 a unit.
The yield on 10-year U.S. Treasury notes increased to 2.98%.
Goldman Sachs gained 4.2% to $306.19 after the financial services company said a surge in bond trading revenues helped to offset the weakness in investment banking revenues in the latest quarter ending in June.
Bank of America increased 1.1% to $32.64 after the lender benefited from the rising rate environment.
Revenues, net of interest expenses, increased 6% to $22.7 billion and net income declined to $5.9 billion or 73 cents a diluted share from $8.9 billion or $1.03 a diluted share.
The bank also took a charge of $523 million for the provision of credit losses.
Investors are also awaiting earnings this week from 135 companies including Tesla, Netflix, United Airlines, Union Pacific, Johnson & Johnson, and Verizon.
IBM is scheduled to report earnings after the regular hours trading today.
Boeing Co increased 4.5% to $154.60 after Delta Airlines placed an order for 100 737 MAX 10 jets.
European Markets Rally
European markets advanced following the optimism in New York and on the hopes that natural gas will start flowing again through Nord Stream 1 pipeline network this week.
European investors are also looking ahead at the European Central Bank's policy meeting on July 21 and a rate hike of 25 basis points followed by a 50 basis points increase at its September meeting.
The DAX index increased 0.7% to 12,962.08, the CAC-40 index added 0.9% to 6,90.20, and the FTSE 100 index advanced 0.98% to 7,228.69.
The euro edged up to trade at $1.015.
Investors also looked ahead to the Italian Prime Minister Mario Draghi's address to the parliament this Wednesday.
H & M Hennes & Mauritz AB declined 0.5% to skr 125.60 and the Swedish apparel retailer said it has stopped its retail selling in Russia since March and has started the process of winding down its operation in the country.
GSK Plc declined 3.3% to 1,386.60 after the British pharmaceutical maker completed the spinoff of its $36 billion consumer healthcare business.
Stellantis NV declined 0.3% to 12.0 euros after the Italian automotive group said it will end its joint venture with a company that makes and sells the Jeep brand in China.
Asian Markets Advance
Markets across Asia closed higher after Chinese regulators urged the central bank to provide financial support to real estate developers.
Mortgage boycotts are spreading in China and home buyers in 12 cities are protesting and suspending monthly payments as unfinished residential real estate projects pile.
About 5 million home buyers with more than $40 billion mortgages have suspended payments according to local media reports in China.
As many as one third of recently sold residential units are facing extended delays or lack of progress on construction sites.
China's economy is struggling after two months of severe lockdowns and the continued restrictions in social gathering for more than 250 million people in at least 20 cities.
Shanghai and Tianjin ordered mass Covid-19 testing following its zero-Covid-19 policy.
The fresh outbreak of infections highlights the risks of new lockdowns and slows the economic rebound in the second largest economy of the world.
The Hang Seng Index soared 2.7% to 20,846.18, the Sensex index gained 1.4% to 54,521.15, and the the Kospi average climbed 1.90% to close at 2,375.25
Markets in Tokyo were closed for a holiday.