Earnings are in Full Swing, and the Market is Swinging too | Wall Street Today
The market fell Tuesday, and indexes pulled back after bank earnings came in hot, while healthcare and semiconductor company reports were more of a mixed bag. ASML earnings semiconductors back hard, and UNH results pulled back the Dow.
Just past 4 pm ET the $S&P 500 Index (.SPX.US)$ fell 0.76%, the $Dow Jones Industrial Average (.DJI.US)$ fell 0.75%, and the $Nasdaq Composite Index (.IXIC.US)$ fell 1.01%.
MACRO
A recent run of strong economic data doesn't mean that more big price increases are around the corner, Mary Daly, president of the SF Fed, told reporters Tuesday. Speaking to a New York University crowd, Daly said he would support taking a break from cuts for a meeting or two.
"You can't, in my judgment, reflexively say, 'I have stronger-than-expected growth, I have stronger-than-expected employment, inflation must be around the corner,' " Daly says.
Minneapolis Fed President Neel Kashkari said at a Tuesday bank conference that the neutral rate must be higher after aggressive rate cuts failed to cause a recession in 2022 and 2023. Seeking Alpha reported he was unsure of the way forward besides gradually lowering rates over the next few quarters.
Monday, Fed Gov. Chris Waller said the economy is much stronger than previously thought, and the labor market remains quite healthy, speaking at Stanford University in California. According to MarketWatch, Waller noted that the Fed and Wall Street had been fooled by reports over the summer that indicated the economy was slowing.
"To remind you of how bad the markets viewed the July data, some Fed watchers were calling for an emergency [Fed] meeting to discuss a rate cut," Waller said.
SECTORS
Within industries tracked by moomoo, Semiconductor equipment and semis fell heavily. Chinese stocks pulled back overnight, and HK stocks fell during U.S. trading on moomoo.
$Crude Oil Futures(JAN5) (CLmain.US)$ fell 3% to $71/barrel, with no recent turbulence or Chinese stimulus to draw up prices. $Bitcoin (BTC.CC)$ fell to start the day before climbing to $66k. Gold silver $U.S. 2-Year Treasury Notes Yield (US2Y.BD)$ and the $U.S. 10-Year Treasury Notes Yield (US10Y.BD)$ both fell.
Trump-related stocks were on the rise on Tuesday. $Phunware (PHUN.US)$ – which helped with Trump's 2020 election campaign -- gained as much as 70% to a $7.99 intraday high, with trading briefly halted for an order imbalance.
Video-platform $Rumble (RUM.US)$ – seen as a conservative alternative to Instagram, which is owned by $Meta Platforms (META.US)$ -- likewise gained as much as 19.9% to a $6.56 session high.
But media company $Trump Media & Technology (DJT.US)$ – parent company of Trump's Truth Social social-media platform – turned negative late in the session after rising as much as 13% intraday earlier. DJT fell 5.6% shortly before 3 p.m. ET, with trading halted for a few minutes on an order imbalance when the stock moved from positive to negative territory.
MOOVERS
$Citigroup (C.US)$ reported Q3 earnings Tuesday of $1.51 per diluted share, down from $1.63 a year earlier. It beat estimates of $1.30, but not enough to get the stock to climb.
$United Airlines (UAL.US)$ reported adjusted Q3 earnings of $3.33/share, above estimates, on revenue of $14.84B that beat estimates. The stock fell after hours. The firm announced its first dividend payment since 2020 of $1.5B.
$Walgreens Boots Alliance (WBA.US)$ posted a $3 billion quarterly loss on Tuesday, driven largely by tax charges and a loss on its investment in a Chinese pharmacy chain. The stock was climbing 14%, the highest on the S&P 500 The firm said it would close 1,200 stores in the next three years, including about 500 in the next year.
$Goldman Sachs (GS.US)$ reported higher third-quarter earnings, with a profit of 45% to $2.99 billion. That amounted to $8.40 per share, which was better than expected. Revenue rose 7% to $12.7 billion. $Bank of America (BAC.US)$ climbed 1.9% on earnings estimate beats of its own.
$UnitedHealth (UNH.US)$ shares fell 7%, the lowest on the Dow, after Tuesday's earnings beat expectations but missed estimates of the medical cost ratio. This healthcare metric compares a firm's healthcare costs to its revenue. UNH showed 85.2% compared to forecasts of 84.4%.
$Charles Schwab (SCHW.US)$ shares are up almost 6% higher after the company reported third-quarter results this morning.
$ASML Holding (ASML.US)$ fell 13%, the lowest in semiconductors after the Dutch semi-making lithography machine firm reported Q3 orders of EUR2.63B, but had forecast -EUR5.59B.
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Disclaimer: This presentation is for informational and educational use only and is not a recommendation or endorsement of any particular investment or investment strategy. Indexes are unmanaged and cannot be directly invested in. Past performance is no indication of future results. Investing involves risk and the potential to lose principal. Investment information provided in this content is general in nature, strictly for illustrative purposes, and may not be appropriate for all investors. It is provided without respect to individual investors’ financial sophistication, financial situation, investment objectives, investing time horizon, or risk tolerance. You should consider the appropriateness of this information regarding your relevant personal circumstances before making any investment decisions. Past investment performance does not indicate or guarantee future success. Returns will vary, and all investments carry risks, including loss of principal. Moomoo makes no representation or warranty regarding its adequacy, completeness, accuracy, or timeliness for any purpose of the above content. See this link for more information.
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Dan’l : It seems no quarterly can satisfy folks these days… if $United Airlines (UAL.US)$ could make their jets sprinkle gold coins when somebody flushed? There’d still be turbulence.
They’re overweight. They’re buying back shares. They’re outperforming. They’re strategically expanding routes.
They’re a good value, at a bargain price.
United Airlines sheds unprofitable capacity in better-than-expected quarter | Morningstar