With just hours to go until the final session of the first quarter wraps, the Dow was on track for its worst single-quarter decline since the fourth quarter of 1987, and its worst first quarter on record.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Stocks have swung widely over the past several weeks, with Monday’s gains coming after a smattering of positive health-care developments helped blunt some fears surrounding reports of a still-rising coronavirus case count, extended stay-at-home orders, and strained hospital infrastructure in the cities hit hardest by the outbreak. Johnson & Johnson said Monday it planned to begin human tests of its coronavirus vaccine by September, and Abbott Laboratories recently unveiled a five-minute coronavirus test.” data-reactid=”18″>Stocks have swung widely over the past several weeks, with Monday’s gains coming after a smattering of positive health-care developments helped blunt some fears surrounding reports of a still-rising coronavirus case count, extended stay-at-home orders, and strained hospital infrastructure in the cities hit hardest by the outbreak. Johnson & Johnson said Monday it planned to begin human tests of its coronavirus vaccine by September, and Abbott Laboratories recently unveiled a five-minute coronavirus test.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Separately, overnight Tuesday, better than expected manufacturing sector data from China suggested the country was beginning to recover some economic damage from the outbreak.” data-reactid=”19″>Separately, overnight Tuesday, better than expected manufacturing sector data from China suggested the country was beginning to recover some economic damage from the outbreak.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Still, both the human impact and business disruptions due to the pandemic have continued to mount around the world. The number of coronavirus cases topped 800,000 globally as of Tuesday, including more than 164,000 in the U.S., according to Johns Hopkins data. In New York, the U.S. epicenter of the outbreak, the number of confirmed cases jumped by nearly 7,000 to 66,497 as of Monday afternoon.” data-reactid=”20″>Still, both the human impact and business disruptions due to the pandemic have continued to mount around the world. The number of coronavirus cases topped 800,000 globally as of Tuesday, including more than 164,000 in the U.S., according to Johns Hopkins data. In New York, the U.S. epicenter of the outbreak, the number of confirmed cases jumped by nearly 7,000 to 66,497 as of Monday afternoon.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Some lawmakers have already been pushing for more fiscal stimulus just days after passing a $2 trillion economic relief package.” data-reactid=”21″>Some lawmakers have already been pushing for more fiscal stimulus just days after passing a $2 trillion economic relief package.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="JCPenney, Macy’s, Kohl’s and Gap became some of the latest major public retailers to announce major furloughs as storefronts remain closed. Companies from Domino’s Pizza to Planet Fitness and L’Oreal recently suspended their respective 2020 financial guidance, as uncertainty over the duration and magnitude of impact from the coronavirus outbreak linger.” data-reactid=”22″>JCPenney, Macy’s, Kohl’s and Gap became some of the latest major public retailers to announce major furloughs as storefronts remain closed. Companies from Domino’s Pizza to Planet Fitness and L’Oreal recently suspended their respective 2020 financial guidance, as uncertainty over the duration and magnitude of impact from the coronavirus outbreak linger.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Amid these developments, many analysts believe further volatility is ahead for equities, with some predicting a choppier “W-shaped” or slower “U-shaped,” rather than a “V-shaped,” recovery. Others, including those at JPMorgan Chase, suggested risk assets could start to stabilize from here.” data-reactid=”23″>Amid these developments, many analysts believe further volatility is ahead for equities, with some predicting a choppier “W-shaped” or slower “U-shaped,” rather than a “V-shaped,” recovery. Others, including those at JPMorgan Chase, suggested risk assets could start to stabilize from here.
As equities at least temporarily take a breather from a selloff earlier this month, investors turned their attention to oil, which recovered some losses Tuesday after a precipitous decline during the prior session sent West Texas intermediate futures to the lowest level since 2002.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="President Donald Trump held a call with Russian leader Vladimir Putin Monday, during which the leaders “agreed on the importance of stability in global energy markets,” according to Bloomberg, citing a White House statement.” data-reactid=”25″>President Donald Trump held a call with Russian leader Vladimir Putin Monday, during which the leaders “agreed on the importance of stability in global energy markets,” according to Bloomberg, citing a White House statement.
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1:12 p.m. ET: Stocks decline again in volatile session
Stocks turned around were down again midday Tuesday, with the Dow off nearly 200 points, or 0.87%. The Nasdaq and S&P 500 each also dipped into negative territory, led by declines in the Real Estate sector.
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11:02 a.m. ET: Stocks pare earlier losses, Dow and Nasdaq turn slightly positive
Here were the main moves in markets, as of 11:02 a.m. ET:
S&P 500 (^GSPC): -4.31 points (-0.16%) to 2,625.76
10:50 a.m. ET: The eventual economic recovery in the U.S. will be ‘U-shaped,’ strategist says
The economic deterioration induced by the COVID-19 outbreak will likely create a “U-shaped” recovery after infection rates peak, or a slower rebound than the speedy “V-shaped” recovery some had initially anticipated, according to Gabriela Santos, JPMorgan global market strategist.
“A ‘V-shape’ I think we should unfortunately discount at this point, because even when infection rates peak for COVID-19 around the world, what the China experience is teaching us is even though the government begins to relax some social distancing guidelines, individuals themselves are still very careful about how exactly they go back to their day to day lives,” she said.
“So demand was quick to shut down, but it’s actually much slower to come back online,” she added. “The better analogy here is a U. There’s a very sharp drop in activity in the first half, there’s a bit of a stall in the second, and then in 2021 is when that strong rebound begins.”
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<h2 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="10:17 a.m. ET: Goldman Sachs slashes first- and second-quarter GDP estimates further” data-reactid=”49″>10:17 a.m. ET: Goldman Sachs slashes first- and second-quarter GDP estimates further
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Goldman Sachs on Tuesday downwardly revised its estimate for second-quarter economic activity in the U.S., citing even greater impact from the coronavirus outbreak than originally anticipated. However, they also upwardly revised their expectations for the margin of recovery in later quarters this year.” data-reactid=”50″>Goldman Sachs on Tuesday downwardly revised its estimate for second-quarter economic activity in the U.S., citing even greater impact from the coronavirus outbreak than originally anticipated. However, they also upwardly revised their expectations for the margin of recovery in later quarters this year.
The firm said it sees real gross domestic product falling 9% in the first quarter and dropping 34% in the second quarter on a quarter over quarter, annualized basis. This compared to their previous estimates of a 6% drop and 24% drop in the first and second quarters, respectively, on a quarter over quarter, annualized basis.
At the same time, the economists upgraded their expectations for the recovery in the second half of this year. They see a 19% quarter over quarter annualized GDP gain in the third quarter, or better than the 12% jump previously anticipated.
“These forecast changes reflect the net effect of two directionally offsetting changes. On the one hand, the anecdotal evidence and the sky-high jobless claims numbers show an even bigger output and (especially) labor market collapse than we had anticipated,” the economists said. “This not only means deeper negatives in the very near term but also raises the specter of more adverse second-round effects on income and spending a bit further down the road.”
“On the other hand, both monetary and fiscal policy are easing dramatically further, which will tend to contain these second-round effects and add to growth down the road,” they added. “The Phase 3 fiscal package was much bigger than we had expected, we now anticipate a Phase 4 package focused on state fiscal aid, and the Fed is likely to use the $454bn addition to the Treasury’s Exchange Stabilization Fund aggressively to sustain the flow of credit to private-sector and municipal borrowers.”
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10:00 a.m. ET: Consumer confidence declines in March ‘in line with a severe contraction,’ Confidence Board says
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Consumer confidence fell but by a smaller margin than anticipated, the Conference Board said Tuesday.” data-reactid=”61″>Consumer confidence fell but by a smaller margin than anticipated, the Conference Board said Tuesday.
The headline consumer confidence index fell to 120.0 in March, better than the 110.0 expected, according to Bloomberg consensus data. February’s index was upwardly revised to 132.6 from 130.7 previously reported.
Subindices tracking consumers’ assessments of current and future business conditions also declined in March.
“Consumer confidence declined sharply in March due to a deterioration in the short-term outlook,” Lynn Franco, senior director of economic indicators at The Conference Board, said in a statement. “The Present Situation Index remained relatively strong, reflective of an economy that was on solid footing, and prior to the recent surge in unemployment claims.”
“However, the intensification of COVID-19 and extreme volatility in the financial markets have increased uncertainty about the outlook for the economy and jobs,” Franco added. “March’s decline in confidence is more in line with a severe contraction – rather than a temporary shock – and further declines are sure to follow.”
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9:31 a.m. ET: Stocks open lower
Stocks opened lower, taking a pause from rising after Monday’s rally.
Early losses in the S&P 500 were led by declines in the Utilities and Financial sectors. Energy was the only positive sector, as crude oil prices recovered some of Monday’s steep losses.
Here were the main moves in markets as of 9:31 a.m. ET:
S&P 500 (^GSPC): -16.97 points (-0.65%) to 2,609.68
Stock futures’ gains proved ephemeral Tuesday morning as contracts on each of the S&P 500, Dow and Nasdaq took a turn a dropped at least 1%, with an hour to go until the opening bell.
Here were the main moves in the three major indices, as of 8:33 a.m. ET:
S&P 500 futures (ES=F): down 1.41%, or 36.75 points to 2,574.5
Dow futures (YM=F): down 1.31% or 290 points to 22,877.00
Nasdaq futures (NQ=F): down 1.07% or 84.25 points to 7,770.5
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7:11 a.m. ET Monday: Stock futures hold steady
Stock futures were little changed Tuesday morning, taking a pause after Monday’s rally. Crude oil prices recovered some losses after a rout sent the commodity down to its lowest level since 2002.
Here were the main moves in markets, as of 7:11 a.m. ET:
S&P 500 futures (ES=F): down 0.08%, or 2 points to 2,609.25
Dow futures (YM=F): up 0.01% or 2 points to 22,169
Nasdaq futures (NQ=F): up 0.25% or 19.5 points to 7,874.25
TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
