ticker

U.S, Movers: American Express, Comercia, Crowdstrike, Microsoft, Netflix, SLB

Scott Peters
19 Jul, 2024
New York City

American Express Company declined 3.4% to $240.14, and the payment processing and financial services company reported weaker-than-expected revenue in the second quarter.

Revenue increased 9% to $16.3 billion from $14.9 billion, net income advanced 39% to $3.0 billion from $2.2 billion, and diluted earnings per share jumped 44% to $3.49 from $2.89 a year ago.

The company raised its full-year earnings outlook to between $13.30 and $13.80 from the previous range of between $12.65 and $13.15.

The membership-based card service provider reiterated its annual revenue growth estimate of between 9% and 11%.

Comercia declined 11.5% to $49.92 after the financial service company said net interest income was lower than a year ago and added that higher rates are negatively impacting loan volume and increasing costs of deposits.

SLB (formerly Schlumberger NV) increased 1.1% to $49.17 after the oil field service provider reported better-than-expected quarterly results.

Revenue in the second quarter increased 13% to $9.1 billion from $8 billion, net income rose 8% to $1.1 billion from $1.0 billion, and diluted earnings per share advanced 7% to 77 cents from 72 cents a year ago.

Netflix increased 0.4% to $644.66 after the streaming service provider reported better-than-expected revenue and earnings in the second quarter, but the company's revenue outlook for the third quarter fell short of some analysts' expectations.

Crowdstrike Holding declined 9.5% to $310.33 after cybersecurity said a product update caused a global outage of information systems that impacted major airlines, banks, and other large corporations.

U.S. Major Averages Heads for First Weekly Loss In Three Months, Businesses Reel Under Global Tech Outage

Barry Adams
19 Jul, 2024
New York City

Market indexes on Wall Street were little changed as investors reacted to a host of geopolitical issues and a fresh batch of earnings.

The S&P 500 index and the Nasdaq Composite are set to close down for the week for the first time in three months after investor sentiment turned cautious for mega-cap technology stocks.

The largest global information system outage caused by Microsoft technology problems and Crowdstrike information systems problems also weighed on market sentiment. Several large banks, airports, airlines, and industrial companies are facing hours of information system disruptions.

UPS, FedEX, Union Pacific, Mount Sinai, and Amazon's AWS are some of the leading companies facing information technology disruptions.

The New York Stock Exchange and Nasdaq confirmed trading systems are operating in normal conditions and are not experiencing any outages.

Investors have been rotating out of mega-cap stocks and into small-cap and cyclical stocks for the second week in a row, in the hopes that the Federal Reserve is likely to cut rates in September.

For the week, the Nasdaq Composite is down more than 3% and the S&P 500 index has declined 1.8%, but the Russell 200 index is up 1.3%.

Investors reacted positively to the latest earnings from American Express, Netflix, SLB, and Intuitive Surgical.

U.S. Indexes and Treasury Yields

The S&P 500 index increased 0.01% to 5,549.35, and the Nasdaq Composite rose 0.03% to 17,876.08.

The yield on 2-year Treasury notes edged lower to 4.49%, 10-year Treasury notes increased to 4.21%, and 30-year Treasury bonds edged higher to 4.42%.

WTI crude oil decreased $0.92 to $81.99 a barrel, and natural gas prices edged down 3 cents to $2.09 a thermal unit.

Gold decreased by $43.85 to $2,396.74 an ounce, and silver was down 75 cents to $28.93.

The dollar index, which weighs the U.S. currency against a basket of foreign currencies, edged lower to 104.33.

U.S. Stock Movers

American Express Company declined 3.4% to $240.14, and the payment processing and financial services company reported weaker-than-expected revenue in the second quarter.

Revenue increased 9% to $16.3 billion from $14.9 billion, net income advanced 39% to $3.0 billion from $2.2 billion, and diluted earnings per share jumped 44% to $3.49 from $2.89 a year ago.

The company raised its full-year earnings outlook to between $13.30 and $13.80 from the previous range of between $12.65 and $13.15.

The membership-based card service provider reiterated its annual revenue growth estimate of between 9% and 11%.

Comercia declined 11.5% to $49.92 after the financial service company said net interest income was lower than a year ago and added that higher rates are negatively impacting loan volume and increasing costs of deposits.

Schlumberger NV increased 1.1% to $49.17 after the oil field service provider reported better-than-expected quarterly results.

Revenue in the second quarter increased 13% to $9.1 billion from $8 billion, net income rose 8% to $1.1 billion from $1.0 billion, and diluted earnings per share advanced 7% to 77 cents from 72 cents a year ago.

Netflix increased 0.4% to $644.66 after the streaming service provider reported better-than-expected revenue and earnings in the second quarter, but the company's revenue outlook for the third quarter fell short of some analysts' expectations.

Crowdstrike Holding declined 9.5% to $310.33 after cybersecurity said a product update caused a global outage of information systems that impacted major airlines, banks, and other large corporations.

Europe Movers: Danske Bank, Electrolux, Mining Stocks, SEGRO

Inga Muller
19 Jul, 2024
Frankfurt

European markets extended weekly losses amid rate path uncertainty, a global tech outage, and a lack of policy clarity in China.

Resource stocks were under pressure after policymakers failed to make major policy announcements at the end of the much-delayed Third Plenum.

The DAX index increased by 0.7% to 18,236.73; the CAC-40 index fell by 0.5% to 7,552.53; and the FTSE 100 index advanced by 0.6% to 8,158.07.

The yield on 10-year German bonds edged higher to 2.44%, French bonds inched higher to 3.10%, the UK gilts inched higher to 4.10%, and Italian bonds decreased to 3.78%.

SEGRO declined 0.8% to 918.0 pence after the UK-based property company agreed to sell a portfolio of four warehouses in Italy for €327 million.

Mining companies in London declined after copper prices eased on the Chinese demand growth worries, after the Chinese Communist Party's top policy committee ended with no major economic reform announcement.

Antofagasta, Angle American, and Glencore declined between 0.7% and 1.5%.

Sartorious AG plunged 12.6% to €172.20 after the German pharmaceutical products maker lowered its full-year outlook.

Electrolux AB increased 6.8% to SEK 96.54 after the Swedish appliance maker swung to a larger-than-expected profit in the second quarter.

Danske Bank AS rose 7.6% to DKK 214.80 after the Danish bank reported better-than-expected second quarter profit.

The bank also said it plans to return 5.5 billion Danish kroner to shareholders later in the year.

European Indexes Extend Weekly Losses, Eurozone Current Account Surplus Held Steady In May

Bridgette Randall
19 Jul, 2024
London

European markets declined in Friday's trading and extended weekly losses after a host of issues hobbled market sentiment.

Benchmark indexes in Paris, London, and Frankfurt declined following the European Central Bank's decision to hold its key lending rates steady on Thursday.

Bond traders are anticipating at least two more rate cuts of 25 basis points in September and October, in the hopes of weakening inflationary pressures.

Investor sentiment was also dented after a global Microsoft outage knocked down computer services at several large companies, banks, and airlines.

German producer price inflation declined 1.6% in June, the Federal Statistical Office, Destatis, reported.

Producer price deflation extended to the 12th month in a row amid falling energy prices, but the decline was the smallest in the latest sequence.

The Eurozone current account surplus was 37 billion in May, matching the level in the previous month, the European Central Bank reported Friday.

In May, the international goods surplus was €33 billion and the service surplus was €15 billion, after exports rose at a faster pace than imports.

The primary income surplus was €4 billion, partly offset by a deficit for secondary income of €14 billion.

Europe Indexes and Yields

The DAX index increased by 0.7% to 18,236.73; the CAC-40 index fell by 0.5% to 7,552.53; and the FTSE 100 index advanced by 0.6% to 8,158.07.

The yield on 10-year German bonds edged higher to 2.44%, French bonds inched higher to 3.10%, the UK gilts inched higher to 4.10%, and Italian bonds decreased to 3.78%.

The euro edged lower to $1.09; the British pound inched higher to $1.29; and the U.S. dollar weakened to 88.94 Swiss cents.

Brent crude decreased $0.21 to $84.89 a barrel, and the Dutch TTF natural gas fell by €0.12 to €32.21 per MWh.

Europe Stock Movers

SEGRO declined 0.8% to 918.0 pence after the UK-based property company agreed to sell a portfolio of four warehouses in Italy for €327 million.

Mining companies in London declined after copper prices eased for the third day in a row.

Chinese demand growth worries kept commodities prices on edge after the Chinese Communist Party's top policy committee ended its Third Plenum with no major economic reform announcement.

Antofagasta, Angle American, and Glencore declined between 0.7% and 1.5%.

Sartorious AG plunged 12.6% to €172.20 after the German pharmaceutical products maker lowered its full-year outlook.

Electrolux AB increased 6.8% to SEK 96.54 after the Swedish appliance maker swung to a larger-than-expected profit in the second quarter.

Danske Bank AS rose 7.6% to DKK 214.80 after the Danish bank reported a better-than-expected second-quarter profit.

The bank also said it plans to return 5.5 billion Danish kroner to shareholders later in the year.

Japan Indexes Extend Weekly Losses, Core Consumer Inflation Accelerated In June

Akira Ito
19 Jul, 2024
Tokyo

Stocks in Japan struggled for clear direction as investors reviewed the latest inflation update and tech stocks rebounded.

The Nikkei 225 stock average and the Topix index traded down in the afternoon session and extended weekly losses after a volatile week of trading.

Overall, consumer price inflation held steady at 2.8%, but the core rate of inflation accelerated for the second consecutive month to 2.6% amid the ending of energy subsidies and elevated food price inflation.

Tech stocks attempted to rebound but remained on shaky ground after a report on Thursday suggested that the U.S. is preparing to put additional curbs on trade with China that could be damaging to export sales of Japan's advanced semiconductor equipment makers.

Japan's CPI Held Steady In June

Japan's annual rate of inflation held steady at 2.8% in June, the Ministry of Internal Affairs and Communications reported Friday.

The sustained inflationary pressures in electricity, energy, food, and housing contributed to overall inflation.

Electricity price inflation eased to 13.4% from 14.7% in May, gas costs rose for the first time in thirteen months to 2.4% from a decrease of 2.5%, food price inflation eased to 3.6% from 4.1%, and house price inflation held steady at 0.6%.

The core rate of inflation, which excludes volatile food prices, accelerated for the second month in a row to 2.6% in June from 2.5% in the previous month, stoking speculation that the Bank of Japan may start a rate hike sooner rather than later.

The monthly inflation rate slowed to 0.3% in June from the 7-month high of 0.5% in May.

Japan Stock Movers

The Nikkei 225 stock average declined 0.4% to 39,980.47, and the Topix index dropped 0.5% to 2,855.33.

For the week, the Nikkei 225 dropped 3.9% and the Topix declined 1.9%.

Tokyo Electron, Advantest, Screen Holdings, Lasertec, and Renesas Electronics rebounded between 1% and 2% after plunging as much as 10% in Thursday's trading.

Among actively traded stocks, Mitsubishi Electric, Sony, and Canon declined between 0.4% and 0.6%.

Disco Corp. declined 4.9% to ¥52,560.0, despite the precision toolmaker for the semiconductor manufacturing industry reporting a sharp jump in profit in the latest quarter.

Disco stock declined because sales and earnings were below market expectations.

Sales in the June quarter increased 53% to 82.8 billion yen, and net income rose 87% to 23.7 billion yen from a year ago, respectively.

For the first half, the company estimated sales of 168.4 billion yen and net income of 46.8 billion yen.

Third Plenum Announcement Focused On Economic Growth Driven by Technological Progress and Quality Workforce

Li Chen
19 Jul, 2024
Hong Kong

Market indexes in Shanghai and Hong Kong struggled after policymakers failed to make any major announcements at the conclusion of the much-delayed third plenum.

The gathering of top policymakers in Beijing, closely watched by foreign and domestic investors, is a forum where national priorities are set for the next five years.

However, before the much-delayed gathering of the top 205 policymakers, investors had low expectations of any major announcement as the Chinese leadership struggled with elevated debt, falling consumer demand, rising capital flight, and trade tensions with the U.S. and the European Union.

At the conclusion of a four-day event last night, Chinese policymakers released a summary statement that was vague and short, and President Xi Jinping urged lawmakers to stick to the priorities set by the government, which focus on technological progress and improved governance.

The committee stressed that China would continue to accelerate reforms in rural land, environmental protection, taxation, national security, and the economy.

China's policymakers are navigating the economy away from construction-led growth to advanced technologies such as artificial intelligence, advanced computing, and renewable energy.

The Chinese yuan weakened to 7.28 against the U.S. dollar, and the yield on the Chinese government bonds held steady at 2.27%.

Investors shifted their attention to the Politburo meeting, China's committee of top leadership, at the end of the month for specific policy announcements.

China Stock Movers

The Hang Seng index declined 2.1% to 17,401.86, and the CSI 300 index gained 0.1% to 3,524.62.

Property developers dropped sharply in Hong Kong after the release of the policy announcement at the end of the third plenum.

Longfor Group declined 5.4% to HK $10.74, China Resources Land decreased 2% to HK $27.65, China Vanke decreased 4.1% to $4.68, and CK Hutchison Holdings decreased 0.5% to HK $40.65.

Tech stocks were also under pressure amid weak market sentiment in Hong Kong.

Tencent decreased 0.9% to HK $365.80, Alibaba Group declined 2.7% to HK $73.75, and Baidu plunged 1.6% to HK $88.0.

India Movers: Infosys, Rallis India, Shoppers Stop, Tata Technologies

Arun Goswami
19 Jul, 2024
Mumbai

Market indexes in Mumbai struggled to advance as investors reviewed the latest batch of quarterly earnings.

Investors stayed on the sidelines due to inflation and rate path worries ahead of the release of the Union Budget next week.

The Sensex index decreased by 0.3% to 81,122.60, and the Nifty index fell by 0.4% to 24,714.15.

On the Mumbai stock exchange, 100 stocks traded at their 52-week highs, and 7 stocks traded at their 52-week lows.

The yield on the 10-year Indian government bonds inched higher to 6.97%, and the Indian rupee edged higher to ₹83.62 against the U.S. dollar.

Infosys increased 4.8% to ₹1,844.0, despite the company reporting a decline in profit in the June quarter.

Revenue increased 3.7% to ₹39,315 crore and net income dropped 20% to ₹6,368 crore from a year ago, respectively.

The company also raised its current-year revenue growth forecast to between 3% and 4%.

Shoppers Stop decreased 3.4% to ₹787.55 after the retailer reported weaker than expected quarterly results.

Revenue increased 7.6% to ₹1,069.3 crore, and net income swung to a loss of ₹22.7 crore from a profit of ₹14.5 crore a year ago.

The company blamed the weakness on the heat wave, elections, fewer weddings, and elevated prices.

Rallis India decreased 5.2% to ₹323.0 after the fertilizer and crop protection company reported sharply weaker quarterly results.

Revenue increased 0.1% to ₹783 crore and net income dropped 23.8% to ₹48 crore from a year ago, respectively.

Tata Technologies declined 0.9% to ₹1,000.0 after the subsidiary of Tata Motors reported weak quarterly results.

Revenue in the June quarter increased by 0.9% to ₹1,269 crore, and net income decreased by 15.4% to ₹162 crore from a year ago, respectively.

Consolidated gross margin was nearly unchanged at 28.2% compared to the previous quarter, and the service business gross margin edged slightly lower to 31.1% from 31.4%.

The company reiterated its positive annual outlook, citing strong order flow and rising activities in key core accounts in aviation, automotive, and industrial heavy machinery.

Tata Technologies stock is well below its peak price of ₹1,400 reached on the first day of trading after the company listed its stock last year, but ahead of its initial public offering price of ₹500.

Broad U.S. Market Sell-Off Extends to Second Day After Rallying In Previous Six Weeks

Alexander Garcia
18 Jul, 2024
Miami

Bears held the grip on market sentiment for the second day in a row and tech stocks extended losses.

Tech stocks failed to rebound after falling sharply in the previous session after two widely followed benchmark indexes created multiple record highs over the last seven weeks.

The Nasdaq Composite fell 0.5% after the index dropped the most in the previous session since 2022, as investors weighed rising trade restrictions with China.

Moreover, mega-cap stocks erased morning gains after falling in the previous session as investors increased positions in cyclical and small-cap stocks.

The Russell 2000 index, which tracks small-cap companies, decreased 0.7%, and the benchmark index trimmed gains of 9% in the previous five sessions, as investors booked profits.

The current market rotation is based on the assumption that the Federal Reserve is ready to lower rates as early as September, and lower rates are likely to benefit smaller and cyclical companies.

The market rally broadened beyond mega-cap stocks in the last week of trading in the hopes that inflation's downward slide will continue and reach the Fed's target rate of 2%.

Investors may be too optimistic about inflation, but despite the eleven rate hikes over 2022 and 2023, inflation has stayed above 3% for last several months.

While the inflation rate has declined over the last two years, wages are still rising at a rate of more than 4% annually, inconsistent with the Fed's objective of bringing inflation down to 2%.

Moreover, the Fed Chair Jerome Powell is signaling that interest rates could be lowered before inflation drops to 2%, as long as price increases are slowing, indicating that policymakers may talk tough but are more likely to abandon their long-held objective of weakening inflation to 2% or lower.

The U.S. labor market may be softening, as the initial weekly jobless claims reached a new high since the first week in August 2023.

Initial jobless claims increased by 10,000 to 243,000 in the week ending on July 13, and continuing claims advanced by 20,000 to 1,867 million, the U.S. Department of Labor reported Thursday.

U.S. Indexes and Treasury Yields

The S&P 500 index decreased 0.5% to 5,562.15, and the Nasdaq Composite fell 0.6% to 17,900.04.

The yield on 2-year Treasury notes edged lower to 4.46%, 10-year Treasury notes decreased to 4.18%, and 30-year Treasury bonds edged higher to 4.30%.

WTI crude oil increased $0.55 to $83.41 a barrel, and natural gas prices edged up 9 cents to $2.12 a thermal unit.

Gold decreased by $1.74 to $2,480.01 an ounce, and silver was down 6 cents to $30.30.

The dollar index, which weighs the U.S. currency against a basket of foreign currencies, edged lower to 103.91.

U.S. Stock Movers

United Airlines Holdings increased 2% to $47.95, and the international carrier reported mixed quarterly results.

Total revenue in the second quarter increased 5.7% to $47.95, net income jumped 23.1% to $1.3 billion from $1.1 billion, and diluted earnings per share advanced to $3.96 from $3.24 a year ago.

Discover Financial Services rose 4.1% to $147.27, and the bank and payment services provider reported better-than-expected quarterly results.

Revenue in the second quarter increased 17% to $4.5 billion from $3.9 billion, net income rose 70% to $1.5 billion from $895 million, and diluted earnings per share advanced to $6.06 from $3.54 a year ago.

Total loans at the end of the quarter increased 8% to $127.6 billion from $117.9 billion, and the total net charge-off rate rose 161 basis points to 4.83% from 3.22% a year ago.

Taiwan Semiconductor gained 2% to $174.95 after an advanced semiconductor maker reported better-than-expected quarterly results.

Revenue in the second quarter increased 40% to NT $673.5 billion, net income jumped 36% to NT $247.8 billion, and diluted earnings per share rose 36.3% to NT $9.56.

In U.S. dollars, second-quarter revenue increased 32.8% from a year ago to $20.82 billion, an increase of 10.3% from the previous quarter.

Gross margin for the quarter was 53.2%, operating margin was 42.5%, and net profit margin was 36.8%.

The company forecasted strong demand for its 3 nanometer production capacity from artificial intelligence-linked customers, and third quarter revenue is expected to range between $22.4 billion and $23.2 billion, and gross margin is expected to be between 53.5% and 55.5%.

ECB Holds Rates Steady, EU New Car Registrations Rebounded In June

European markets advanced, and investors awaited monetary policy decisions by the European Central Bank.

The ECB held its three key lending rates steady after lowering rates for the first time in June since 2016.

The central bank held its main refinancing rate at 4.25%, the deposit facility rate at 3.75%, and the marginal lending rate at 4.5%.

Policymakers have been reluctant to provide a future rate path outlook amid wage pressure, as inflation remains above the 2% target rate set by the central bank.

Bond traders are still looking for the ECB to lower rates by 25 basis points in September and October, but the rate outlook could change if energy prices rebound in the coming weeks.

EU Passenger Car Registration Advanced 4.3% In June

Passenger car registration in the European Union increased 4.3% from a year ago in June, driven by an increase in three of the four largest markets in the region.

Passenger car registration in Italy increased 15.1%, in Germany it advanced 6.2%, in Spain it gained 2.2%, but declined in France by 4.8%.

Battery electric vehicle registration declined 1% to 156,400, driving the total market share down to 14.4% from 15.1% a year ago.

In the first half of 2024, new car registrations increased by 4.5% to nearly 5.7 million units; however, registration volumes remained 18% below pre-pandemic levels.

In the first six months of the year, the bloc’s largest markets all showed positive but modest performance, with a 5.9% increase in Spain, 5.4% in Germany and Italy, and a 2.8% rise in France.

Europe Indexes and Yields

The DAX index decreased by 0.5% to 18,354.76; the CAC-40 index rose by 0.2% to 7,586.55; and the FTSE 100 index advanced by 0.2% to 8,204.89.

The yield on 10-year German bonds edged higher to 2.44%, French bonds inched higher to 3.10%, the UK gilts inched higher to 4.08%, and Italian bonds decreased to 3.73%.

The euro edged lower to $1.09; the British pound inched higher to $1.30; and the U.S. dollar weakened to 88.40 Swiss cents.

Brent crude increased $0.37 to $85.042a barrel, and the Dutch TTF natural gas rose by €0.77 to €32.33 per MWh.

Europe Stock Movers

Frasers Group PLC increased 8.9% to 889.50 pence after the company's annual guidance for the current year surpassed market expectations.

Publicis Groupe SA gained 4.5% to €101.60 after the company reported better-than-expected first-half results and raised its annual outlook for organic growth.

Automakers advanced after new car registration in the European Union increased by 4.3% to 1.09 million units, reversing the 3% decline in May.

BMW increased 1.8% to €91.32, Mercedes Benz advanced 2% to €64.61, Volkswagen jumped 1.2% to €107.75, and Renault gained 0.7% to €50.08.

Nokia declined 4.7% to €3.41, and the Finnish telecom equipment maker reported a 32% decline in its second quarter operating income due to weak demand for its 5G wireless communication equipment.

ABB Ltd. declined 6.2% to CHF 47.98 after the Swiss engineering company reported higher earnings, but orders fell in the second quarter.

Net income increased by 21% to $1.1 billion from $906 million, and basic earnings per share rose to 59 cents from 49 cents a year ago.

Revenue increased 1% to $8.24 billion from $8.16 billion, and orders dropped 3% to $8.44 billion from $8.67 billion in the previous year.

For the fiscal year, ABB retained its comparable revenue growth estimate of 5% and operational EBIT margin of 18%.

Nikkei 225 Drops 2% Amid Global Chip Stocks Selloff

The global tech stock selloff extended to Japan amid growing worries about rising trade tensions between the U.S. and China.

The Nikkei 225 stock average plunged more than 2%, and the broader Topix index declined 1.5% amid reports that the U.S. is looking to expand trade restrictions and impose tougher sanctions on companies exporting critical semiconductor equipment to China.

Moreover, Donald Trump, a U.S. presidential candidate and convicted felon, said that Taiwan should be paying for its defense as tensions simmer between China and Taiwan.

Japan's Trade Surplus Expanded In June

On the economic front, Japan's trade surplus unexpectedly rose in June after exports rose faster than imports.

Japan's trade surplus expanded to 224.04 billion yen in June from 36.5 billion yen in the corresponding month a year ago, the Ministry of Finance reported Thursday.

Japan recorded a trade surplus for the second month of this year, after exports rose 5.4% and imports advanced 3.2% from a year ago, respectively.

Exports increased for the seventh month in a row due to strong demand from the U.S. and China, and the weaker yen restricted the growth in imports.

For the first six months, Japan posited a trade gap of 3.23 trillion yen.

Japan Stock Movers

The Nikkei 225 stock average declined 2.3% to 40,153.18, and the Topix index dropped 1.5% to 2,872.61.

Tokyo Electron dropped 8.8% to ¥30,470.0, Lasertec declined 6.3% to ¥29,740.0, Screen Holdings fell 8.6% to ¥13,560.0, and Disco Corp. plunged 8.8% to ¥55,260.0.

Honda Motor Company declined 2.9% to ¥1,665.0, and the vehicle maker priced its secondary offering at a 3% discount to Wednesday's closing price.

On the upside, Kansai Electric Power, Nichirei, Nitori Holdings, and Asahi Group added as much as 3%.

Nikkei 225 Drops 2% Amid Global Chip Stocks Selloff, Japan's Trade Surplus Expanded in June