Market Update
U.S. Movers: eBay, Rivian, Roblox, Robinhood Markets, Toast
Scott Peters
08 Nov, 2023
New York City
Robinhood Markets Inc. dropped 12.4% to $8.55 after the online trading platform reported weaker-than-expected sales of $467 million in the third quarter.
Revenue in the third quarter increased by 29% to $467 million, driven by a 96% increase in net interest income to $251 million.
Transaction-based revenues decreased 11% from a year ago to $185 million, driven by a decline in equities trading by 13% to $27 million, crypto trading by 55% to $23 million, and flat options trading of $124 million.
Net loss in the quarter shrank to $85 million from $175 million, and diluted loss per share fell to 9 cents from 20 cents a year ago.
Average revenue per user increased by 27% to $80, and monthly active users fell 16% to 10.3 million.
Net deposit inflow in the quarter was $4 billion, and assets under custody surged 34% to $87 billion, reflecting higher equity valuations and a continued net inflow of assets.
eBay Inc. declined 5.8% to $38.45 after the online marketplace reported mixed quarterly results.
Revenue in the third quarter increased 5% to $2.5 billion from $2.4 billion, the company swung to a net profit of $1.3 billion from a loss of $69 million, and diluted earnings per share increased to $2.47 from a loss of 13 cents a year ago.
The company guided fourth-quarter revenue to fall between $2.47 and $2.5 billion and diluted earnings per share between 70 cents and 75 cents.
eBay estimated full-year 2023 revenue to range between $10.02 billion and $10.08 billion and diluted earnings per share between $4.53 and $4.58.
Toast Inc. plunged 16.5% to $14.39 after the restaurant software developer swung to a quarterly loss.
Revenue in the quarter rose 34% to $1.03 billion from $752 million, net loss shrank to $31 million from $98 million, and diluted loss per share declined to 9 cents from 19 cents a year ago.
Gross payment volume soared 34% to $33.7 billion, and the average revenue run rate in the third quarter was up 40% to $1.218 billion.
However, the stock fell on worries that the macroeconomic headwinds may continue to negatively impact same-store sales and slow gross volume through the platform.
For the full year 2023, Toast expects revenue in the range of $3.83 billion to $3.86 billion, up from the previous range between $3.81 billion and $3.87 billion.
Roblox Corp. jumped 15.2% to $40.44 after the company reported stronger-than-expected quarterly results.
Revenue in the third quarter increased 38% to $713.2 million from $517.7 million, net loss declined to $277.8 million from $301.9 million, and diluted loss per share fell to 45 cents from 50 cents a year ago.
Bookings on the platform jumped 20% to $839.5 million, and average daily active users soared 20% to 70 million.
Rivian Automotive Inc. fell 4.5% to $16.63 after the company reported quarterly results and a weak production outlook.
Revenue in the third quarter jumped to $1.1 billion from $536 million, net loss fell to $1.4 billion from $1.8 billion, and diluted loss per share decreased to $1.19 from $1.57 a year ago.
During the quarter, vehicle deliveries jumped to 15,564 from 6,584 a year ago.
The company increased 2023 production guidance by 2,000 to 54,000 vehicles.
U.S. Averages Attempt to Extend Longest Rally In Two Years
Barry Adams
08 Nov, 2023
New York City
The stock market continued its upward march as upbeat investors looked for bargains in tech and high-growth stocks.
The S&P 500 index and the Nasdaq Composite extended the gains of the previous week after interest rate uncertainties receded.
Investors are hoping that the Federal Reserve may be able to navigate the U.S. economy to a soft landing and avoid future rate hikes.
The Federal Reserve is attempting to keep economic growth intact while slowing inflation to its target rate of 2% and keeping the labor market from shrinking.
Investors are increasingly confident that the Federal Reserve is likely to engineer a so-called soft landing, driving the stock market higher and keeping inflation in check.
In today's trading, investors bid up big tech stocks and reacted to earnings releases.
The electric vehicle maker Rivian jumped more than 6% on better-than-expected quarterly results and production outlook; Robinhood declined more than 10% after transaction-based revenue declined 11% from a year ago; and Toast Inc. plunged more than 15% after the restaurant software company swung to a loss in the latest quarter.
U.S. indexes and Yields
The S&P 500 index increased 0.2% to 4,387.84, and the Nasdaq Composite increased 0.2% to 13,660.29.
The yield on 2-year Treasury notes increased to 4.93%, 10-year Treasury notes inched higher to 4.55%, and 30-year Treasury bonds edged down to 4.69%.
Crude oil decreased $0.71 to $71.67 a barrel, and natural gas prices rose 0.1 cent to $3.14 a thermal unit.
Gold decreased $9.40 to $1,959.82 an ounce after bond yields edged lower and the dollar weakened.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 106.65.
U.S. Stock Movers
Robinhood Markets Inc. dropped 12.4% to $8.55 after the online trading platform reported weaker-than-expected sales of $467 million in the third quarter.
Revenue in the third quarter increased by 29% to $467 million, driven by a 96% increase in net interest income to $251 million.
Net loss in the quarter shrank to $85 million from $175 million, and diluted loss per share fell to 9 cents from 20 cents a year ago.
Average revenue per user increased by 27% to $80, and monthly active users fell 16% to 10.3 million.
Net deposit inflow in the quarter was $4 billion, and assets under custody surged 34% to $87 billion, reflecting higher equity valuations and a continued net inflow of assets.
eBay declined 5.8% to $38.45 after the online marketplace reported mixed quarterly results.
Revenue in the third quarter increased 5% to $2.5 billion from $2.4 billion, the company swung to a net profit of $1.3 billion from a loss of $69 million, and diluted earnings per share increased to $2.47 from a loss of 13 cents a year ago.
The company guided fourth-quarter revenue to fall between $2.47 and $2.5 billion and diluted earnings per share between 70 cents and 75 cents.
eBay estimated full-year 2023 revenue to range between $10.02 billion and $10.08 billion and diluted earnings per share between $4.53 and $4.58.
Europe Movers: ABN AMRO, Commerzbank, Continental AG, Credit Agricole, ITV, Marks & Spencer, Serco
Inga Muller
08 Nov, 2023
Frankfurt
European markets lacked direction for the second day in a row after rallying the previous week.
September retail sales in the Euro Area declined 2.9% from a year ago as consumers battled elevated prices and rising interest rates.
The DAX index decreased 0.4% to 15,099.82, the CAC-40 index fell 0.2% to 6,974.08, and the FTSE 100 index declined 0.2% to 7,399.50.
The yield on 10-year German bonds decreased to 2.64%, French bonds traded lower to 3.23%, the UK gilts edged down to 4.26%, and Italian bonds inched higher to 4.54%.
Credit Agricole SA increased 1.8% to €11.79 after the French bank reported better-than-expected earnings in the third quarter.
Standalone revenue in the third quarter increased 19.2% to €6.3 billion, and net income surged 32.8% to €1.8 billion.
Positive results in corporate and investment banking overwhelmed the weakness in retail banking in France, and the asset management division saw stronger asset inflows of €13.7 billion in the quarter.
Continental AG jumped 2.2% to €63.14 after the company reported slightly higher earnings in the latest quarter.
Consolidated sales in the third quarter declined 1.5% to €10.2 billion from €10.4 billion, but net income increased to €299 million from a loss of €211 million.
The company tightened its consolidated annual sales outlook to between €41.0 billion and €43.0 billion, up from the previous range of between €41.5 billion and €44.5 billion.
The company also slightly raised its adjusted operating earnings margin outlook to between 12.5% and 13.5% from the previous range of between 12% and 13%.
Commerzbank AG declined 3% to €10.08, despite the German bank reporting a profit in the third quarter that more than tripled.
ITV plc decreased 5.6% to 61.92 pence after the British television network operator reported flat revenue.
Serco Group plc gained 1.3% to 146.0 pence after the company won a £200 million monitoring service contract for the Ministry of Justice.
Marks & Spencer Group plc soared 10.6% to 249.17 pence after the retailer reported a jump in profit in the fiscal first half.
Revenue in the first half jumped 10.8% to £6.1 billion from £5.5 billion in the corresponding period a year ago.
Statutory after-tax profit in the first half jumped 24.1% to £206.9 million from £166.7 million, and basic earnings per share increased to 10.6 pence from 8.5 pence a year ago.
ABN AMRO Bank dropped 9.5% to €11.91 after the Dutch bank reported weaker-than-expected net interest income in the third quarter because of deposit migration to higher-yielding products.
Net income in the quarter increased to €759 million from €743 million, and earnings per share rose to 85 cents from 80 cents a year ago.
Net interest income increased 20% from a year ago to €1.5 billion but fell from the previous quarter because of deposit migration and lower results in trading activities.
European Market Indexes Meandered, Euro Area Retail Sales Declined Third Consecutive Month
Bridgette Randall
08 Nov, 2023
New York City
European markets trended lower in cautious trading, and bond yields declined for the second week in a row.
Benchmark indexes in Frankfurt, London, and Paris fell after investors reassessed the economic outlook and future rate path.
The latest retail sales data suggests consumers are still challenged amid elevated food and energy prices and rising interest rates.
Euro Area Retail Sales Declined for Third Consecutive Month
Retail sales in the Euro Area decreased by 0.3% in September from the previous month and dropped by 2.9% from a year ago, Eurostat reported Wednesday.
The volume of retail trade declined by 1.9% for non-food products and by 0.9% for automotive fuels, while food, drink, and tobacco sales rose by 1.4%.
Among the largest economies in the currency union, retail sales declined by 0.8% and fell for the fourth consecutive month in a row in Germany, decreased by 0.4% in Italy, and edged lower by 0.8% in the Netherlands.
However, sales in France rose by 0.4%, and sales in Spain edged up by 0.2%.
Europe Indexes and Yields
The DAX index decreased 0.4% to 15,099.82, the CAC-40 index fell 0.2% to 6,974.08, and the FTSE 100 index declined 0.2% to 7,399.50.
The yield on 10-year German bonds decreased to 2.64%, French bonds traded lower to 3.23%, the UK gilts edged down to 4.26%, and Italian bonds inched higher to 4.54%.
The euro rebounded to $1.066, the British pound at $1.22, and the U.S. dollar at 90.20 Swiss cents.
Brent crude decreased $0.42 to $81.14 a barrel, and the Dutch TTF natural gas edged higher by €0.67 to €45.43 per MWh.
Europe Stock Movers
Credit Agricole SA increased 1.8% to €11.79 after the French bank reported better-than-expected earnings in the third quarter.
Continental AG jumped 2.2% to €63.14 after the company reported slightly higher earnings in the latest quarter.
Consolidated sales in the third quarter declined 1.5% to €10.2 billion from €10.4 billion, but net income increased to €299 million from a loss of €211 million.
The company tightened its consolidated annual sales outlook to between €41.0 billion and €43.0 billion, up from the previous range of between €41.5 billion and €44.5 billion.
The company also slightly raised its adjusted operating earnings margin outlook to between 12.5% and 13.5% from the previous range of between 12% and 13%.
Commerzbank AG declined 3% to €10.08, despite the German bank reporting profit in the third quarter that more than tripled.
ITV plc decreased 5.6% to 61.92 pence after the British television network operator reported flat revenue.
Serco Group plc gained 1.3% to 146.0 pence after the company won a £200 million monitoring service contract for the Ministry of Justice.
Marks & Spencer Group plc soared 10.6% to 249.17 pence after the retailer reported a jump in profit in the fiscal first half.
Revenue in the first half jumped 10.8% to £6.1 billion from £5.5 billion in the corresponding period a year ago.
Statutory profit in the first half jumped to £325.6 million from £208.5 million, and basic earnings per share increased to 10.6 pence from 8.5 pence a year ago.
ABN AMRO Bank dropped 9.5% to €11.91 after the Dutch bank reported weaker-than-expected net interest income in the third quarter because of deposit migration to higher-yielding products.
Net income in the quarter increased to €759 million from €743 million, and earnings per share rose to 85 cents from 80 cents a year ago.
Net interest income increased 20% from a year ago to €1.5 billion but fell from the previous quarter because of deposit migration and lower results in trading activities.
Tech Stocks Power Nasdaq 8-day Rally, Treasury Yields Declined Again
Barry Adams
07 Nov, 2023
New York City
The decline in Treasury yields supported a market advance for the seventh day in a row as investors snapped up tech stocks.
Market indexes traded higher after the S&P 500 index advanced for the seventh day in a row and the Nasdaq Composite advanced for the eighth session.
Microsoft jumped 1.6% to a record high of $362.45, Apple increased 1.7% to $182.34 and Google-parent Alphabet advanced 1% to $131.62.
Investors bid up stocks after the Federal Reserve paused rate hikes for the second time in a row on November 1 after citing progress on inflation.
In addition, after the Fed's rate decision, a softer increase of 115,000 in nonfarm payroll in October also supported the Fed's case of holding interest rates.
Market indexes soared more than 5% last week on the hopes that the Federal Reserve may hold rates for the third time in a row at the next meeting on December 12–13.
In the absence of any market-moving economic releases, investors are likely to focus on comments from Fed Chairman Jerome Powell and react to earnings announcements.
Chairman Powell is scheduled to deliver the Fed's assessment of the economy at two separate industry gatherings this week.
So far this month, the S&P 500 index has advanced 4.5% and the Nasdaq Composite has jumped 6.2%.
Investors are awaiting quarterly results from ebay, Rivian, and Lucid after the close of regular trading hours.
U.S. International Trade Deficit Widened In October
The trade deficit in the U.S. widened to $61.5 billion in September, following an upwardly revised $58.7 billion gap in August, the Bureau of Economic Analysis reported Tuesday.
Imports increased 2.7% from a year ago to $322.7 billion, and exports rose at a slower 2.2% pace to $261.1 billion.
Exports rose to the highest level since August 2022, driven by crude oil, soybeans, corn, travel, and transport services.
Imports advanced on the rising demand for cell phones, civilian aircraft parts and machinery, passenger cars, and computer accessories.
U.S. indexes and Yields
The S&P 500 index increased 0.4% to 4,382.96, and the Nasdaq Composite increased 1.1% to 13,664.09.
The yield on 2-year Treasury notes increased to 4.89%, 10-year Treasury notes inched higher to 4.54%, and 30-year Treasury bonds edged down to 4.71%.
Crude oil decreased $3.11 to $77.69 a barrel, and natural gas prices fell 12 cents to $3.13 a thermal unit.
Gold decreased $8.16 to $1,969.42 an ounce after bond yields edged lower and the dollar weakened.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 105.75.
U.S. Stock Movers
Uber Technologies Inc. increased 1.7% to $48.96 despite the double-digit ride hailing company's weaker-than-expected quarterly results.
Revenue in the third quarter increased 11% to $9.3 billion from $8.3 billion, but the company swung to a loss of $1.3 billion from a profit of $221 million, and diluted earnings per share were ($0.61) compared to 10 cents a year ago.
Gross bookings in the quarter increased by 21% to $35.3 billion, driven by a 31% increase in mobility bookings to $17.9 billion and an 18% increase in delivery bookings to $16.1 billion.
Monthly active customers on the platform increased by 15% to 142 million from 124 million.
The company anticipates gross bookings in the fourth quarter in the range of $36.5 billion and $37.5 billion.
WeWork Inc. closed at 84 cents in Monday's trading but dropped as low as 11 cents in Tuesday's pre-market trading after the company filed for Chapter 11 bankruptcy protection in New Jersey federal court.
The company said its liabilities are between $10 billion and $50 billion and said it has entered into agreements with most of its secured note holders.
WeWork was valued at $47 billion in 2019 fund raising led by SoftBank but was forced to accept a sharply lower valuation of about $8 billion when it agreed to go public through a special purpose acquisition company in 2021.
TripAdvisor Inc. soared 10% to $17.76 after the online travel platform company reported better-than-expected quarterly results.
Revenue in the third quarter increased 16% to $533 million from $459 million, net income increased 8% to $27 million from $25 million, and diluted earnings per share rose to 19 cents from 17 cents a year ago.
On September 7, the company's board authorized a $250 million stock repurchase plan over the next two years.
European Indexes Drifted Lower and Bond Yields Eased
Stock market indexes in Europe traded down after China reported mixed international trade data.
Market indexes in Frankfurt, Paris, and London edged lower after China's exports declined for the sixth month in a row, but imports unexpectedly increased.
German industrial production declined for the fourth month in a row, and industrial producer prices in the eurozone declined at a record pace in September.
China Exports and Trade Surplus Dropped
Exports declined in October by 6.4% to $274.3 billion, and imports rose 3.0% to $218.3 billion, the General Administration of Customs reported Tuesday.
Imports rose for the first time since February, suggesting that the Chinese government's plan to stimulate the economy is having a positive impact.
Sluggish exports dragged the trade surplus in October to $56.5 billion from $77.7 billion in September.
Exports declined to the U.S. by 8.2%, Japan by 13.0%, ASEAN by 15.1%, South Korea by 17%, and the European Union by 12.6%.
German Industrial Production Fell for 4th Consecutive Month In September
Germany's industrial production declined for the fourth month in a row, highlighting ongoing economic weakness in the Euro Area's largest economy.
Industrial production declined 1.4% in September from the previous month, following the downwardly revised 0.1% fall in August, Destatis reported Tuesday.
On an annual basis, industrial production declined 3.7% from a year ago.
The sharp fall of 5% from the previous month in automobile production led to the decline in the month, followed by a 4.4% decline in electrical equipment and a 9.2% fall in the pharmaceutical industry, offset by a 4.1% rise in mechanical engineering.
Outside the manufacturing industry, energy production fell by 1.7% in September, and construction production was unchanged from the previous month.
Record Decline In Eurozone Producer Prices In September
Industrial producer prices declined 12.4% from a year ago in the euro area in September, Eurostat reported Tuesday.
The measure of wholesale prices dropped at the fastest pace on record, driven by a 31.3% plunge in energy prices and 4.8% in intermediate goods.
Meanwhile, prices rose at a slower pace of 3.9% compared to 4.4% in August for capital goods, durable goods inflation eased to 4.3% from 4.7%, and non-durable consumer goods slowed to 5.5% from 6.6%.
Excluding energy, producer price inflation decelerated to 0.5% from a year ago in September, down from 1.0% in August.
On a monthly basis, producer prices rose by 0.5%, the second month of an increase in a row.
UK Home Prices Extended Decline In October
UK home prices continued to fall in October as buyers struggled with elevated home prices and surging mortgage rates.
The Halifax House Price Index fell 3.2% from a year ago in October, following a revised 4.5% in September, Halifax and the Bank of Scotland reported Tuesday.
On an annual basis, home prices declined in all regions across the UK, with the Southeast leading with a fall of 6.0% and London property prices easing by 4.6%.
On a monthly basis, home prices rose 1.1%, following a decline for six months in a row due to the lack of availability of homes for sale.
Europe Indexes and Yields
The DAX index increased 0.1% to 15,152.64, the CAC-40 index fell 0.4% to 6,986.23, and the FTSE 100 index fell 0.1% to 7,410.04.
The yield on 10-year German bonds decreased to 2.70%, French bonds traded lower to 3.29%, the UK gilts edged down to 4.30%, and Italian bonds inched higher to 4.52%.
The euro rebounded to $1.069, the British pound at $1.232, and the U.S. dollar at 89.99 Swiss cents.
Brent crude decreased $2.94 to $82.93 a barrel, and the Dutch TTF natural gas edged higher by €1.23 to €46.06 per MWh.
Europe Stock Movers
Energy and resource companies were in focus after China reported mixed international trade data and tensions in the Middle East receded.
BP plc fell 1.2% to 485.40 pence, Shell PLC dropped 1.5% to €30.79, and TotalEnergies SE eased 1.4% to €61.76.
UBS Group AG gained 3% CHF 22.54 after the Swiss banking group reported progress in trimming costs and stronger-than-expected client inflows.
Total revenue in the third quarter increased to $11.7 billion from $8.2 billion, and operating profit before-tax swung to a loss of $255 million from $2.3 billion.
Underlying profit before-tax, which excludes Credit Suisse integration charges, decreased to $844 million from $2.0 billion a year ago.
Watches of Switzerland Group PLC jumped 8.2% to €6.55 after the luxury watch retailer reported improving sales in its fiscal second quarter, and the retailer set the target to double its sales and profit by fiscal year 2028.
Persimmon plc increased 4.6% to 1,132.0 pence after the UK-based home builder lifted its estimate of new home completions.
Associated British Foods plc soared 6.4% to 2,237.0 pence after the Primark owner reported a 5% increase in annual income and the food company declared a special dividend.
Engie SA increased 2.1% to €15.46 after the French energy company said operating earnings for the nine-month period rose 14.7% to €8.3 billion from €7.3 billion in the same period a year ago.
The company also revised its annual outlook.
U.S. International Trade Deficit Widened In October
Brian Turner
07 Nov, 2023
New York City
The U.S. trade deficit in goods and services widened to $61.5 billion in September, following an upwardly revised $58.7 billion gap in August, the Bureau of Economic Analysis reported Tuesday.
The September increase in the goods and services deficit reflected an increase in the goods deficit of $1.7 billion to $86.3 billion and a decrease in the services surplus of $1.2 billion to $24.8 billion.
Imports increased 2.7% from a year ago to $322.7 billion, and exports rose at a slower 2.2% pace to $261.1 billion.
Exports in September rose to the highest level since August 2022, driven by crude oil, soybeans, corn, travel, and transport services.
Imports advanced on the rising demand for cell phones, civilian aircraft parts and machinery, passenger cars, and computer accessories.
The deficit with Japan increased $1.9 billion to $6.9 billion in September, after exports increased by $0.2 billion to $6.7 billion and imports rose by $2.1 billion to $13.6 billion.
The goods deficit with China totaled $24.1 billion, followed by the European Union with $16.8 billion, Mexico with $12.2 billion, Vietnam with $9.4 billion, and Japan with $6.9 billion.
U.S. Movers: Tripadvisor, Uber Technologies, WeWork
Scott Peters
07 Nov, 2023
New York City
Uber Technologies Inc. increased 1.7% to $48.96 despite the ride hailing company's weaker-than-expected quarterly results.
Revenue in the third quarter increased 11% to $9.3 billion from $8.3 billion, and the company swung to a profit of $221 million from a loss of $1.3 billion, and diluted earnings per share were 10 cents compared to a loss of 61 cents a year ago.
Gross bookings in the quarter increased by 21% to $35.3 billion, driven by a 31% increase in mobility bookings to $17.9 billion and an 18% increase in delivery bookings to $16.1 billion.
Monthly active customers on the platform increased by 15% to 142 million from 124 million.
The company anticipates gross bookings in the fourth quarter in the range of $36.5 billion and $37.5 billion.
WeWork Inc. closed at 84 cents in Monday's trading but dropped as low as 11 cents in Tuesday's pre-market trading after the company filed for Chapter 11 bankruptcy protection in New Jersey federal court.
The company said its liabilities are between $10 billion and $50 billion and said it has entered into agreements with most of its secured note holders.
WeWork was valued at $47 billion in 2019 fund raising led by SoftBank but was forced to accept a sharply lower valuation of about $8 billion when it agreed to go public through a special purpose acquisition company in 2021.
TripAdvisor Inc. soared 10% to $17.76 after the online travel platform company reported better-than-expected quarterly results.
Revenue in the third quarter increased 16% to $533 million from $459 million, net income increased 8% to $27 million from $25 million, and diluted earnings per share rose to 19 cents from 17 cents a year ago.
On September 7, the company's board authorized a $250 million stock repurchase plan over the next two years.
U.S. Averages Pause After Weeklong Rally
Barry Adams
07 Nov, 2023
New York City
Stocks on Wall Street paused after rallying for more than a week, and investors reassessed the Fed's next move.
Market indexes edged slightly lower in pre-market trading after the S&P 500 index advanced for six days in a row and the Nasdaq Composite for seven days in a row.
Investors bid up stocks after the Federal Reserve paused rate hikes for the second time in a row on November 1 after citing progress on inflation.
In addition, after the Fed's rate decision, a softer increase of 115,000 in nonfarm payroll in October also supported the Fed's case of holding interest rates.
Market indexes soared more than 5% last week on the hopes that the Federal Reserve may hold rates for the third time in a row at the next meeting on December 12–13.
In the absence of any market-moving economic releases, investors are likely to focus on comments from Fed Chairman Jerome Powell and react to earnings announcements.
Chairman Powell is scheduled to deliver the Fed's assessment of the economy at two separate industry gatherings on Tuesday and Wednesday.
U.S. International Trade Deficit Widened In October
The trade deficit in the U.S. widened to $61.5 billion in September, following an upwardly revised $58.7 billion gap in August, the Bureau of Economic Analysis reported Tuesday.
Imports increased 2.7% from a year ago to $322.7 billion, and exports rose at a slower 2.2% pace to $261.1 billion.
Exports rose to the highest level since August 2022, driven by crude oil, soybeans, corn, travel, and transport services.
Imports advanced on the rising demand for cell phones, civilian aircraft parts and machinery, passenger cars, and computer accessories.
U.S. indexes and Yields
The S&P 500 index decreased 0.1% to 4,341.04, and the Nasdaq Composite increased 0.1% to 13,589.12.
The yield on 2-year Treasury notes increased to 4.95%, 10-year Treasury notes inched higher to 4.62%, and 30-year Treasury bonds edged down to 4.78%.
Crude oil increased $1.85 to $78.95 a barrel, and natural gas prices fell 15 cents to $3.11 a thermal unit.
Gold decreased $12.26 to $1,965.48 an ounce after bond yields edged lower and the dollar weakened.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 105.75.
U.S. Stock Movers
Uber Technologies Inc. increased 1.7% to $48.96 despite the double-digit ride hailing company's weaker-than-expected quarterly results.
Revenue in the third quarter increased 11% to $9.3 billion from $8.3 billion, but the company swung to a loss of $1.3 billion from a profit of $221 million, and diluted earnings per share were ($0.61) compared to 10 cents a year ago.
Gross bookings in the quarter increased by 21% to $35.3 billion, driven by a 31% increase in mobility bookings to $17.9 billion and an 18% increase in delivery bookings to $16.1 billion.
Monthly active customers on the platform increased by 15% to 142 million from 124 million.
The company anticipates gross bookings in the fourth quarter in the range of $36.5 billion and $37.5 billion.
WeWork Inc. closed at 84 cents in Monday's trading but dropped as low as 11 cents in Tuesday's pre-market trading after the company filed for Chapter 11 bankruptcy protection in New Jersey federal court.
The company said its liabilities are between $10 billion and $50 billion and said it has entered into agreements with most of its secured note holders.
WeWork was valued at $47 billion in 2019 fund raising led by SoftBank but was forced to accept a sharply lower valuation of about $8 billion when it agreed to go public through a special purpose acquisition company in 2021.
TripAdvisor Inc. soared 10% to $17.76 after the online travel platform company reported better-than-expected quarterly results.
Revenue in the third quarter increased 16% to $533 million from $459 million, net income increased 8% to $27 million from $25 million, and diluted earnings per share rose to 19 cents from 17 cents a year ago.
On September 7, the company's board authorized a $250 million stock repurchase plan over the next two years.
Europe Movers: Associated British Foods, Engie, Persimmons, Resource Stocks, UBS Group, Watches of Switzerland
Inga Muller
07 Nov, 2023
Frankfurt
European market indexes declined for the second day in a row, and bond yields extended the decline to the third week in a row.
The DAX index decreased 0.3% to 15,092.93, the CAC-40 index fell 0.5% to 6,977.85, and the FTSE 100 index fell 0.1% to 7,409.80.
The yield on 10-year German bonds decreased to 2.70%, French bonds traded lower to 3.29%, the UK gilts edged down to 4.30%, and Italian bonds inched higher to 4.52%.
Energy and resource companies were in focus after China reported mixed international trade data and tensions in the Middle East receded.
BP plc fell 1.2% to 485.40 pence, Shell PLC dropped 1.5% to €30.79, and TotalEnergies SE eased 1.4% to €61.76.
Glencore PLC declined 2% to 433.25 pence, Anglo American plc fell 2.8% to 2,155.50 pence, and Antofagasta plc dropped 1.9% to 1,323.50 pence.
UBS Group AG gained 3% CHF (22.54) after the Swiss banking group reported progress in trimming costs and stronger-than-expected client inflows.
Watches of Switzerland Group PLC jumped 8.2% to €6.55 after the luxury watch retailer reported improving sales in its fiscal second quarter, and the retailer set the target to double its sales and profit by fiscal year 2028.
Persimmon plc increased 4.6% to 1,132.0 pence after the UK-based home builder lifted its estimate of new home completions.
Associated British Foods plc soared 6.4% to 2,237.0 pence after the Primark owner reported a 5% increase in annual income and the food company declared a special dividend.
Engie SA increased 2.1% to €15.46 after the French energy company said operating earnings for the nine-month period rose 14.7% to €8.3 billion from €7.3 billion in the same period a year ago.
The company also revised its annual outlook.
European Indexes Drifted Lower and Bond Yields Eased
Bridgette Randall
07 Nov, 2023
Frankfurt
Stock market indexes in Europe traded down after China reported mixed international trade data.
Market indexes in Frankfurt, Paris, and London edged lower after China's exports declined for the sixth month in a row, but imports unexpectedly increased.
German industrial production declined for the fourth month in a row, and industrial producer prices in the eurozone declined at a record pace in September.
China Exports and Trade Surplus Dropped
Exports declined in October by 6.4% to $274.3 billion, and imports rose 3.0% to $218.3 billion, the General Administration of Customs reported Tuesday.
Imports rose for the first time since February, suggesting that the Chinese government's plan to stimulate the economy is having a positive impact.
Sluggish exports dragged the trade surplus in October to $56.5 billion from $77.7 billion in September.
Exports declined to the U.S. by 8.2%, Japan by 13.0%, ASEAN by 15.1%, South Korea by 17%, and the European Union by 12.6%.
German Industrial Production Declined for 4th Consecutive Month In September
Germany's industrial production declined for the fourth month in a row, highlighting ongoing economic weakness in the Euro Area's largest economy.
Industrial production declined 1.4% in September from the previous month, following the downwardly revised 0.1% fall in August, Destatis reported Tuesday.
On an annual basis, industrial production declined 3.7% from a year ago.
The sharp fall of 5% from the previous month in automobile production led to the decline in the month, followed by a 4.4% decline in electrical equipment and a 9.2% fall in the pharmaceutical industry, offset by a 4.1% rise in mechanical engineering.
Outside the manufacturing industry, energy production fell by 1.7% in September, and construction production was unchanged from the previous month.
Record Decline In Eurozone Producer Prices In September
Industrial producer prices declined 12.4% from a year ago in the euro area in September, Eurostat reported Tuesday.
The measure of wholesale prices dropped at the fastest pace on record, driven by a 31.3% plunge in energy prices and 4.8% in intermediate goods.
Meanwhile, prices rose at a slower pace of 3.9% compared to 4.4% in August for capital goods, durable goods inflation eased to 4.3% from 4.7%, and non-durable consumer goods slowed to 5.5% from 6.6%.
Excluding energy, producer price inflation decelerated to 0.5% from a year ago in September, down from 1.0% in August.
On a monthly basis, producer prices rose by 0.5%, the second month of an increase in a row.
UK Home Prices Extended Sixth Month Decline In October
UK home prices continued to fall in October as buyers struggled with elevated home prices and surging mortgage rates.
The Halifax House Price Index fell 3.2% from a year ago in October, following a revised 4.5% in September, Halifax and the Bank of Scotland reported Tuesday.
On an annual basis, home prices declined in all regions across the UK, with the Southeast leading with a fall of 6.0% and London property prices easing by 4.6%.
On a monthly basis, home prices rose 1.1%, following a decline for six months in a row due to the lack of availability of homes for sale.
Europe Indexes and Yields
The DAX index decreased 0.3% to 15,092.93, the CAC-40 index fell 0.5% to 6,977.85, and the FTSE 100 index fell 0.1% to 7,409.80.
The yield on 10-year German bonds decreased to 2.70%, French bonds traded lower to 3.29%, the UK gilts edged down to 4.30%, and Italian bonds inched higher to 4.52%.
The euro rebounded to $1.069, the British pound at $1.232, and the U.S. dollar at 89.99 Swiss cents.
Brent crude decreased $1.84 to $83.34 a barrel, and the Dutch TTF natural gas edged higher by €1.87 to €46.71 per MWh.
Europe Stock Movers
Energy and resource companies were in focus after China reported mixed international trade data and tensions in the Middle East receded.
BP plc fell 1.2% to 485.40 pence, Shell PLC dropped 1.5% to €30.79, and TotalEnergies SE eased 1.4% to €61.76.
UBS Group AG gained 3% CHF 22.54 after the Swiss banking group reported progress in trimming costs and stronger-than-expected client inflows.
Watches of Switzerland Group PLC jumped 8.2% to €6.55 after the luxury watch retailer reported improving sales in its fiscal second quarter, and the retailer set the target to double its sales and profit by fiscal year 2028.
Persimmon plc increased 4.6% to 1,132.0 pence after the UK-based home builder lifted its estimate of new home completions.
Associated British Foods plc soared 6.4% to 2,237.0 pence after the Primark owner reported a 5% increase in annual income and the food company declared a special dividend.
Engie SA increased 2.1% to €15.46 after the French energy company said operating earnings for the nine-month period rose 14.7% to €8.3 billion from €7.3 billion in the same period a year ago.
The company also revised its annual outlook.
After Rallying for Days, Caution Returned to Trading Amid Worries About Real Estate Sector
Barry Adams
06 Nov, 2023
New York City
Market indexes on Wall Street turned lower, and bond yields extended the previous week's decline after interest rate uncertainties eased.
Benchmark indexes erased morning gains in Monday's trading, and the market mood turned to caution after three hours of trading, as investors took a breather after the best weekly performance last week in 2023.
The S&P 500 index and the Nasdaq Composite advanced 5% in the previous week, the best weekly gains since November 2022.
Investors returned to add stock exposure in the hopes that the Federal Reserve is done raising interest rates for now and may hold rates for the third time at the next and final rate-setting meeting on December 13.
Market sentiment was bolstered after the 10-year Treasury note yield trended lower from the 16-year high of 5% after expectations rose that the Federal Reserve would hold rates steady till the first two-day meeting of 2024 ending on January 31.
Last week, a softer increase in nonfarm payroll in October supported the Fed's case for a rate hike pause. further emboldening investors to increase stock exposure.
In Monday's trading, benchmark indexes advanced for the fifth day in a row on stable rates, improving earnings, and stronger-than-expected economic growth driven by resilient consumer spending and not-too-tight labor conditions, which are also supporting the rise in stock market indexes.
But worries about stretched valuations and the impact of a surge in interest rates on interest-sensitive sectors like real estate dragged the indexes lower.
The commercial real estate sector is taking a large hit since interest rates have surged from near zero to 5.5% in the last eighteen months.
Moreover, the residential real estate market is also facing tough headwinds after mortgage rates jumped to 15-year highs and existing home sales transactions in October dropped to the annual pace of 3.9 million, the level last seen in 2007-8 housing market crisis.
U.S. indexes and Yields
The S&P 500 index decreased 0.2% to 4,351.22, and the Nasdaq Composite declined 0.2% to 13,446.85.
The yield on 2-year Treasury notes increased to 4.88%, 10-year Treasury notes inched higher to 4.60%, and 30-year Treasury bonds edged down to 4.78%.
Crude oil increased $1.40 to $81.91 a barrel, and natural gas prices fell 25 cents to $3.25 a thermal unit.
Gold decreased $10.46 to $1,981.92 an ounce after bond yields edged lower and the dollar weakened.
The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.95.
U.S. Stock Movers
Citigroup added 0.1% to $42.31, and the bank is looking to trim as many as 10,000 jobs from its total payroll of 240,000.
The news was first reported by CNBC without naming sources.
Berkshire Hathaway Class B increased 0.6% to $353.99 after the reinsurance insurance-anchored diversified conglomerate reported a surge in quarterly profits.
Operating earnings in the third quarter increased 40% to $10.76 billion from $7.6 billion, driven by a sharp increase in its insurance business.
Insurance underwriting swung to a profit of $2.4 billion from a loss of $1.07 billion, and insurance investment income soared to $2.5 billion from $1.4 billion a year ago.
Investment income jumped after interest rates jumped in the twelve-month period to the end of the third quarter, after the Federal Reserve carried out its aggressive rate hike campaign between March 2022 and June 2023.
Total revenues increased to $93.2 billion from $76.9 billion, net loss attributable to shareholders increased to $12.7 billion from $2.7 billion, and diluted loss per Class A share increased to $8,824 from $1,907 a year ago.
Based on GAAP accounting, net income also reflected the quarterly unrealized investment losses of $29.8 billion compared to $13.5 billion in the corresponding quarter a year ago.
Cash and equivalent securities held by the company at the end of September jumped to $157.2 billion from $128.5 billion a year ago.
European Markets Halted 5-day Rally, Bond Yields Drifted Lower
European markets lacked direction in Monday's trading following a 5-day rally.
In cautious market sentiment, stocks drifted lower and bond yields continued to slide for the second week in a row after interest rate uncertainties eased following the rate hike pause in the U.S. and U.K.
Investors are struggling to recalibrate expectations in the face of a looming economic slowdown, tight labor market conditions, and rising interest rates driven by elevated inflation.
Inflation has been falling in the Euro Area, and consumer price inflation has steadily declined from a peak of 10.1% in November 2022 to 2.9% in October.
The European Central Bank has raised interest rates several times, but consumer inflation is still higher than the target rate of 2%. The recent decrease in inflation is due to lower energy prices and a higher base for the previous year.
Market indexes in Frankfurt, London, and Paris edged slightly lower, and investors reviewed updates on the UK's construction industry, German factory orders, and eurozone business activity.
German Factory Orders Advanced In September
German factory orders adjusted for seasonal factors, and the calendar unexpectedly rose 0.2% from the previous month in September, the Destatis reported Monday.
Factory orders fell 4.3% from a year ago.
August orders were downwardly revised to a 1.9% increase from the previous estimate of 3.9% following the revision of incorrect data in the manufacturing of electronic, optical, and computer products.
Domestic orders fell 5.9% and foreign orders were up 4.2%, after orders in the eurozone increased 6.2% and orders from the rest of the world rose 2.9%.
In other economic news, the HCOB Eurozone PMI compiled by S&P Global declined to 46.5 in October from 47.2 in September, the weakest reading since November 2020.
The purchasing managers' index highlighted different conditions in Spain and Italy.
The PMI for Spain in October was little changed at 50.0 from 50.1 in September, indicating stable conditions in the country.
The service PMI for Italy in October decreased to 47.7 from 49.9 in September, and the index contracted at the fastest pace in a year because of a decline in service output and activity.
The U.K. construction PMI rose to 45.6 in October from 45.0 in September, reflecting ongoing weakness in residential construction.
Home building declined for the eleventh month in a row, and civil construction activities declined at the sharpest pace since July 2020.
Europe Indexes and Yields
The DAX index decreased 0.3% to 15,135.95, the CAC-40 index fell 0.5% to 7,013.73, and the FTSE 100 index was flat at 7,417.76.
The yield on 10-year German bonds decreased to 2.70%, French bonds traded lower to 3.29%, the UK gilts edged down to 4.33%, and Italian bonds inched higher to 4.52%.
The euro rebounded to $1.075, the British pound at $1.242, and the U.S. dollar at 89.61 Swiss cents.
Brent crude increased $0.96 to $85.85 a barrel, and the Dutch TTF natural gas edged lower by €3.23 to €44.83 per MWh.
Europe Stock Movers
Telecom Italia SpA declined 0.3% to €0.25 after the company agreed to sell its landline business to the U.S.-based private equity group KKR LP for €19 billion.
PostNL NV dropped 11% to €1.59 after the Dutch parcel delivery company reported a quarterly loss and forecasted annual profit to fall near the low end of its previous estimate.
Ryanair Holdings plc increased 6.6% to €16.21 after the discount airline forecasted a record annual profit and indicated its plan to pay a regular dividend.
Scottish Mortgage Investment Trust PLC declined 0.5% to 684.48 pence after the company reported a decline in net asset value in the first half of the fiscal year.
Prudential plc decreased 0.8% to 892.60 pence after the insurance company reported a slower pace of growth in the third quarter from the previous quarter.
Melrose Industries PLC rose 3.5% to 507.0 pence after the company's unit, GKN Aerospace, signed a new agreement with GE Aerospace.