Client Login

S&P NEARS RECORD ON TECHNOLOGY BOOST

SECTION SELECTION

US FINANCIAL MARKET | US ECONOMY & POLITICS
 EUROPE & WORLD | TODAY IN HISTORY

DAILY MARKET REPORTS

  • The benchmark S&P 500 was within striking distance of a record high on Tuesday, powered by gains in technology stocks, and a strong second-quarter earnings season fueled optimism about the strength in the U.S. economy.
  • Eight of the 11 major S&P sectors were higher. The defensive consumer staples, utilities, and real estate sectors fell.
  • Shares of high-flying stocks, including those of Google’s parent Alphabet, Microsoft and Facebook were trading up between 0.3% percent to 0.7%. They helped drive a 0.51 gain in the S&P tech sector.
  • Technology and energy stocks have been at the center of a sharp recovery in the S&P since a market rout in February.
  • A strong earnings season has also helped U.S. stocks cushion some of the impacts from the ongoing trade issues.
  • Of the 413 S&P 500 companies that have reported earnings so far, 79.2% have topped estimates. If the beat rate holds, it will be the highest on record, dating back to the first quarter of 1994.
  • Marriott fell 3.3% after the world’s largest hotel chain signaled weakness in revenue per available room (revPAR) in North America for the third quarter.
  • Walt Disney rose 0.7% ahead of its results later in the day.

US FINANCIAL MARKET

  • Discovery missed estimates for quarterly profit, as the owner of Discovery Channel and Animal Planet took on more costs related to integration of the recently acquired Scripps network.
  • Revenue rose 63% to $2.85 billion, in line with estimates. Advertising revenue from the company’s U.S. networks more than doubled to $1.1 billion, while ad revenue from its international networks also rose about 42% to $473 million.
  • However, profit fell as Discovery’s costs nearly doubled and restructuring charges related to Scripps piled up.
  • Discovery completed the $11.9 billion acquisition of Scripps in March integrating Scripps’ largely female-focused lifestyle channels such as HGTV, Travel Channel and Food Network with Discovery’s channels, whose viewers are primarily male.
  • Net income fell to $216 million, from $374 million a year earlier.

Hertz narrows second-quarter losses

  • Hertz Global reported a 7 percent increase in revenue and narrowed its losses by 60 percent over the year.
  • The Estero-based car rental giant recorded revenue of about $2.4 billion, up from about $2.2 billion a year ago.
  • Meanwhile, net losses declined to $63 million. That compared to losses of $158 million a year ago.
  • Adjusted for one-time costs, losses came in at $16 million, compared to $52 million last year.
  • The results beat Wall Street’s expectations.

Marriott sees revenue weakness in third quarter, shares fall

  • Marriott International signaled weakness in revenue per available room (revPAR) in North America, its largest market, for the third quarter, sending shares of the world’s largest hotel chain down about 4%.
  • Revenue rose to $5.35 billion but missed Wall Street estimate of $5.84 billion due to a drop 5.6% in fee received from the properties that the company owns or leases.
  • Net income rose to $610 million in the second quarter, from $489 million a year earlier.
  • The company also raised its forecast of full-year adjusted profit to $5.81 to $5.91 per share from $5.43 to $5.55 per share.

Aecom Technology Tops Earnings and Revenue Estimates

  • Aecom posted revenues of $5.15 billion for the quarter, up 12.9% compared to year-ago revenues of $4.56 billion and beating estimates by 5.4%.
  • The infrastructure firm’s backlog grew to $54 billion, up 16% from a year ago.
  • Aecom won $9.4 billion worth of business in the quarter.
  • Net income fell to $75.1 million, down 44.8% from $136.1 million a year ago. The same quarter in 2017 had a $66.5 million gain from equity investments in joint ventures compared to $12.8 million in the current quarter. After adjustments this beat estimates.

U.S. Concrete Announces Second Quarter 2018 Results

  • The aggregate provider announced that revenue increased 18.6% to $404.2 million, up from $340.9 million a year earlier and ahead of estimates of $391.7 million.
  • Ready-mixed concrete revenue increased 12.9% to $350.0 million, while volume increased by 5%. Aggregate products revenue increased 113.1% to $48.5 million. Both segments posted higher volumes but lower ASPs.
  • Net income increased to $16.3 million compared to a loss of $2.3 million a year ago. After adjusting for one time items this number fell just short of estimates.

Brooks Automation Beats Earnings and Revenue Estimates

  • Brooks posted revenues of $223.48 million for the quarter, up 23% compared to year-ago revenues of $181.72 million and 8% higher sequentially. This beat estimates of $218.3 million.
  • Semiconductor Solutions segment revenue was higher in the third quarter compared to the second quarter by $15 million, or 9%, at $174 million.  The Life Sciences segment revenue grew $1 million, or 2%, sequentially to $50 million. The Life Sciences segment revenue increased 35% year-over-year in total and 13% on an organic basis.
  • After adjusting for items, net income rose to $22.6 million compared to $17.4 million a year ago, and marginally ahead of consensus on a per share basis.

Zillow tanks after acquisition of mortgage lender, revenue miss

  • Shares of online home sales site Zillow tanked after hours Monday after the company announced revenue that was shy of expectation and plans to acquire a national mortgage lender to assist with home purchases.
  • The company reported revenue of $325 million for the quarter, just shy of consensus estimates of $326 million but up 22% from a year earlier.
  • Mortgage revenue declined 8% from a year earlier to $19.3 million but ahead of the high range of management guidance.
  • Zillow’s net loss narrowed to $3 million compared to $21.8 million in 2017.
  • Shares plunged more than 16% in extended trading to below $50 after being halted for the acquisition announcement.

Weight Watchers shares fall after company reports subscriber decline

  • Weight Watchers shares fell after the company reported a decline in the number of subscribers despite quarterly earnings that beat analysts’ expectations on Monday
  • The company reported revenue of $409.7 million compared to estimates of $409.5 million. That revenue figure represents a growth of nearly 20% year over year from $341.7 million.
  • For the second quarter, Weight Watchers said it had 4.5 million subscribers, down from 4.6 million in the previous quarter. Despite the decline, Weight Watchers still saw 27.6% year-over-year subscriber growth.
  • Net income jumped to $70.7 million from $45.2 million a year earlier and came in well ahead of estimates on a per share basis.
  • They raised their full-year guidance and now expect earnings between $3.10 and $3.25 per share up from between $3.00 and $3.20 per share.

Etsy Stock Jumps on Second-Quarter Earnings Report, Guidance Raise

  • Etsy stock jumped Monday, following second-quarter results reported after the market close that missed on the bottom line but beat revenue estimates, and it raised guidance for the year.
  • Etsy reported revenue of $132.4 million, up 30% from the year-ago quarter and beating the consensus estimate of $127.1 million.
  • Gross merchandise sales on its platform rose to $901.7 million, up 20.4% from the year-ago quarter.
  • Net income fell to $3.4 million in the quarter compared to $11.7 million a year ago due to a foreign exchange loss of $4.5 million and a one-time tax benefit in 2017.
  • Etsy raised revenue guidance for this year to a range of $587 million to $596 million. That’s up from a previous range of $582 million to $591 million.

Spark Therapeutics shares lose a third of their value as hemophilia gene therapy trial disappoints investors

  • Shares of Spark Therapeutics slid more than 30% after the company reported the results of a small trial for an experimental gene therapy treatment for hemophilia that reduced bleeds in most patients but sent one to the hospital.
  • At the highest dose in the study, which the company plans to use in its phase 3 trial, five of seven patients saw levels of the protein important in hemophilia A restored to an average of 30% of normal.
  • Two patients, though, had an immune response that caused the level of that protein to decline to less than 5%. One of the patients was admitted to the hospital in what Spark described as a serious adverse event.
  • The company also released its second-quarter results before the market opened Tuesday, reporting $25.2 million in total revenue for the three months ended June 30, compared with $1.5 million during the same period last year.
  • Spark also swung to an $80.2 million profit during the second quarter, from a $74.4 million loss in 2017. More than $20 million of its revenue came from agreements it has with Pfizer.

Tesla starts hiring for new $2 billion Shanghai plant

  • Tesla has started hiring for its new Shanghai factory, according to job postings on its website, just a month after the U.S. electric vehicle (EV) maker signed agreements with local authorities for the $2 billion project.
  • The automaker’s website showed it is looking to fill 14 roles including architectural designer and senior finance manager. Most of the positions are senior in level and require at least six years’ experience, the job descriptions showed.
  • Tesla last month signed agreements with Shanghai authorities to build its first factory outside the United States, which would double the size of the EV maker’s global manufacturing.

Icahn highlights Amazon threat in bid to block Cigna-Express Scripts deal

  • Activist investor Carl Icahn urged Cigna shareholders to vote against the health insurer’s $52 billion purchase of Express Scripts, citing regulatory hurdles and the growing threat of Amazon.
  • The Cigna-Express Scripts deal has drawn investor skepticism over concerns that Amazon’s entry into healthcare will upend the sector, which is already reeling from President Donald Trump’s push to lower drug prices.
  • The billionaire investor, who has a long position on Cigna and a short position on Express Scripts, said in the letter titled “Cigna’s $60 billion folly” that the insurer was overpaying for Express Scripts.
  • Icahn said Cigna should instead repurchase its shares and pursue a partnership with existing pharmacy benefit managers, including Express Scripts.

Mattress Firm explores U.S. bankruptcy to close stores

  • Mattress Firm, the largest U.S. mattress retailer, is considering a potential bankruptcy filing as it seeks ways to get out of costly store leases and shut some of its 3,000 locations that are losing money.
  • Mattress Firm’s South African parent, Steinhoff, has been working on a deal to restructure the debt of some subsidiaries with its creditors, following an accounting scandal. Creditors agreed last month to hold off on their debt claims for three years.
  • The sources, who requested not to be identified because the plans are private, cautioned that Mattress Firm has not made any final decisions and its plans could change.

Back to Top


US ECONOMY & POLITIC

  • The number of positions waiting to be filled increased by 3,000 to 6.662 million in June, according to the Job Openings and Labor Turnover Survey, or JOLTS.
  • Analysts had forecast 6.625 million openings.
  • Hiring fell to 5.65 million from 5.75 million; the hiring rate fell to 3.8% from 3.9%.
  • 3.4 million Americans quit their jobs, down from 3.48 million the prior month, leaving the quits rate unchanged at 2.3%.
  • Layoffs rose to 1.72 million from 1.62 million.
  • The elevated number of job postings shows companies are still expanding though having trouble finding employees from a shrinking pool or because of a skills mismatch. It’s another sign, in line with other employment data, that shows a robust labor market.
  • In May, a record 3.48 million Americans quit their positions. The steady quits rate shows Americans leaving their jobs to remain confident about finding new work that likely pays more and offers better benefits.

New Trump sanctions on Iran take effect despite pleas from allies

  • U.S. President Donald Trump pledged on Tuesday that firms doing business with Tehran would be barred from the United States as new U.S. sanctions against Iran took effect in spite of pleas from Washington’s allies.
  • Iran dismissed a last-minute offer from the Trump administration for talks, saying it could not negotiate while Washington had reneged on a 2015 deal to lift sanctions in return for curbs on Iran’s nuclear program.
  • Washington accepts that Iran has complied with the terms of the 2015 deal reached under Trump’s predecessor Barack Obama, but says the agreement is flawed because it is not strenuous enough.
  • The sanctions that took effect on Tuesday target Iranian purchases of U.S. dollars, metals trading, coal, industrial software and its auto sector.

Manafort’s right-hand man testifies against him in tax fraud case

  • Rick Gates, a longtime business associate of U.S. President Donald Trump’s former campaign chairman Paul Manafort, on Monday testified that he helped Manafort file false tax returns and hide his foreign bank accounts.
  • Gates is the government’s star witness in its case against Manafort, who is accused of bank and tax fraud. Gates pleaded guilty in February and agreed to cooperate with prosecutors under a deal that could lead to a reduced sentence.
  • Taking the stand on the trial’s fifth day, Gates admitted to helping Manafort doctor financial statements, hide foreign income and cheat on his taxes. He said he was aware Manafort was acting as an unregistered foreign agent in lobbying for Ukraine.
  • In addition to assisting Manafort, Gates told the jury he had failed to report income he routed through his bank accounts in the UK and said he stole several hundreds of thousands of dollars from Manafort by filing false and inflated expense reports.
  • Manafort’s defense hinges on pinning the blame on Gates, who they accused of embezzling millions of dollars from Manafort.

Trump faces political test in Ohio as five states cast votes

  • President Donald Trump faces a test of his political influence on Tuesday in a special congressional election in Ohio that has become a referendum on his leadership and the last chance to gauge Democratic strength ahead of November’s midterm elections.
  • The Ohio race for a U.S. House of Representative’s seat headlines a day of voting across the country that also features primaries in four other states. Other key contests include a Democratic battle for governor in Michigan between a progressive and a mainstream candidate and a high-profile conservative challenge to the incumbent Republican governor in Kansas.
  • The district, split between suburban Columbus and rural areas, has been represented by a Republican since the early 1980s. Trump carried it by 11 percentage points in the 2016 presidential race.
  • A Monmouth poll last week showed the race was essentially a dead heat, down from a double-digit advantage for Balderson a month ago. In addition to more Democrats expressing high interest in the race, Murray said the shift was driven by independents unhappy with the status quo under Trump.

Ongoing California wildfire is now the state’s largest ever in recorded history

  • California’s biggest wildfire on record raged on Tuesday as hot and windy conditions challenged thousands of fire crews battling eight major blazes burning out of control across the state.
  • The Mendocino Complex grew to span 283,000 acres (114,526 hectares) on Monday when two wildfires merged at the southern tip of the Mendocino National Forest, the California Department of Forestry and Fire Protection said.
  • It is the largest of eight major fires burning out of control across California, prompting U.S. President Donald Trump to declare a “major disaster” in the state.
  • The size of the fire has surpassed that of last year’s Thomas Fire, which burned 281,893 acres in Santa Barbara and Ventura counties when it destroyed more than 1,000 structures. The Mendocino Complex has burnt 75 homes and forced thousands to be evacuated.

Back to Top


EUROPE & WORLD

European companies can be protected from U.S. sanctions on Iran: UK minister

  • European companies can be protected from new U.S. sanctions on Iran, a junior British foreign minister said, after President Donald Trump withdrew from an international agreement designed to deny Tehran the ability to build nuclear weapons.
  • As Washington’s so-called snapback sanctions are reinstated on Tuesday, a new EU law to shield European companies will also take effect to try to mitigate what EU officials say is their unlawful reach beyond U.S. borders.

  • German industrial output fell more than expected in June, data showed on Tuesday, suggesting that factories in Europe’s largest economy ended the second quarter on a weaker footing.
  • Data from the Economy Ministry showed industrial output dropped by 0.9%, undershooting a Reuters forecast for a fall of 0.5%. The figure for May was revised to a rise of 2.4% from a previously reported increase of 2.6%.
  • The Federal Statistics Office said in a separate statement that seasonally adjusted exports were unchanged on the month in June while imports rose by 1.2%. The seasonally adjusted trade surplus narrowed to 19.3 billion euros from an upwardly revised 20.4 billion euros in May.

China reportedly bans Disney’s ‘Winnie the Pooh’ movie after Xi comparisons

  • Disney’s new movie “Christopher Robin” has reportedly been banned from release in China because its main character, a talking bear, has previously been likened to President Xi Jinping.
  • According to the Hollywood Reporter, the new film will not be seen in China as Beijing is upset that the Pooh character has become a way for people to mock the president.
  • In 2017, Beijing started blocking pictures of Winnie the Pooh on social media and in June this year, Chinese authorities blocked HBO after “Last Week Tonight” host John Oliver mocked Xi’s sensitivity over being compared to Winnie the Pooh.

As death toll on Indonesia’s Lombok tops 100, thousands wait for aid

  • The death toll from a powerful earthquake that hit Indonesia’s tourist island of Lombok topped 100 on Tuesday as rescuers found victims under wrecked buildings, while thousands left homeless in the worst-affected areas waited for aid to arrive.
  • About 75% of the north has been without electricity since Sunday, officials said, and some communities were hard to reach because bridges were damaged and trees, rocks and sand lay across roads cracked wide open in places by the tremor.
  • Officials said about 4,600 foreign and domestic tourists had been evacuated from the three Gili islands off the northwest coast of Lombok, where two people died and fears of a tsunami spread soon after the quake.

Back to Top


TODAY in HISTORY

  • Congress established the U.S. War Department. (1789)
  • The United States launched Explorer 6, which sent back a picture of Earth. (1959)
  • Congress passed the Tonkin Gulf Resolution, which expanded President Johnson’s use of military powers in the Vietnam War. (1964)

This information has been prepared from sources believed to be reliable, but no representation is being made as to its accuracy or completeness. The information provided should be used only as general information and is not intended to provide specific advice or recommendations for any individual. The economic forecasts set forth in the material may not develop as predicted. All indices, such as the S&P 500, are unmanaged and may not be invested into directly. Sources: Reuters, Bloomberg, the Wall Street Journal.

Content posted by third parties on this site is screened in order to protect clients’ privacy and comply with regulatory requirements. Content containing sensitive personal information, inappropriate language, information about specific investments, misleading information, information about other companies or websites, or information related to litigation will be removed. Content posted by third-parties on this site remains the responsibility of the party posting the content and is not adopted or endorsed by Pence Wealth Management or LPL Financial. Any opinions or statements posted by third parties are their own and may not be representative of the experience of others and are not indicative of future performance or success. Third party content on this site does not reflect the views of LPL Financial and have not been reviewed by LPL Financial as to accuracy or completeness.

Comments are closed.

All Financial Consultants at Pence Wealth Management are Registered Representatives with, and securities and Advisory services offered through LPL Financial, a Registered Investment Advisor, Member FINRA & SIPC. Financial Planning offered through Pence Wealth Management, a Registered Investment Advisor and separate entity from LPL Financial. The LPL Financial representative associated with this website may only discuss and/or transact securities business with residents of the following states: Alaska (AK), Alabama (AL), Arkansas (AR), Arizona (AZ), California (CA), Colorado (CO), Connecticut (CT), Delaware (DE), Florida (FL), Georgia (GA), Hawaii (HI), Idaho (ID), Illinois (IL), Kansas (KS), Kentucky (KY), Louisiana (LA), Massachusetts (MA), Michigan (MI), Minnesota (MN), Mississippi (MS), Missouri (MO), Montana (MT), Nebraska (NE), Nevada (NV),

New Hampshire (NH), New Jersey (NJ), New Mexico (NM), New York (NY), North Carolina (NC), North Dakota (ND), Ohio (OH), Oklahoma (OK), Oregon (OR), Pennsylvania (PA), Rhode Island (RI), South Carolina (SC), South Dakota (SD), Texas (TX), Utah (UT), Virginia (VA), Washington (WA), Wyoming (WY), Washington (DC)

Laila Marshall-Pence CA Insurance Lic# 0545421

BC_badge_black_small