Stocks sank Monday as investor jitters over rising coronavirus cases in key parts of the country stirred up an extension of last week’s pullback in equities.
Travel and leisures stocks including cruise lines and airlines posted some of the steepest declines in the S&P 500. Energy companies including Occidental Petroleum, Diamondback Energy and Apache Corporation also fell, with oil demand seen as tied closely to the success of the reopening of the economy and a pick-up in travel. Crude oil prices sank 4%.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Last week, stocks posted their first weekly loss in a month, with a steep selloff on Thursday comprising much of the weekly decline. The plunge, which came on the heels of a more than 40% run-up in the S&P 500 since March, came after new data showed rising coronavirus case and hospitalization counts in states that were among the first to reopen businesses, and after the Federal Reserve delivered a grim forecast for economic activity in the near-term.” data-reactid=”18″>Last week, stocks posted their first weekly loss in a month, with a steep selloff on Thursday comprising much of the weekly decline. The plunge, which came on the heels of a more than 40% run-up in the S&P 500 since March, came after new data showed rising coronavirus case and hospitalization counts in states that were among the first to reopen businesses, and after the Federal Reserve delivered a grim forecast for economic activity in the near-term.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Market participants continued to eye coronavirus cases across the country for signs of resurgences. New cases in the densely populated state of Florida grew faster than the past week’s average as of Sunday’s tally, according to Bloomberg data, and Washington State Department of Health issued a report warning of state-wide increases in the virus.” data-reactid=”19″>Market participants continued to eye coronavirus cases across the country for signs of resurgences. New cases in the densely populated state of Florida grew faster than the past week’s average as of Sunday’s tally, according to Bloomberg data, and Washington State Department of Health issued a report warning of state-wide increases in the virus.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="In New York, the daily coronavirus death toll came in at 23 as of Sunday, or the lowest since the pandemic began and well below the near 800 per day at the outbreak’s peak in early April. Governor Andrew Cuomo, however, flagged that more than 25,000 complaints had been filed over violations of social distancing standards, and Cuomo warned he would tighten restrictions if businesses and individuals did not comply with the phased reopening process.” data-reactid=”20″>In New York, the daily coronavirus death toll came in at 23 as of Sunday, or the lowest since the pandemic began and well below the near 800 per day at the outbreak’s peak in early April. Governor Andrew Cuomo, however, flagged that more than 25,000 complaints had been filed over violations of social distancing standards, and Cuomo warned he would tighten restrictions if businesses and individuals did not comply with the phased reopening process.
Still, some analysts maintained that geographies that have been slower to reopen including the Northeast, were less at risk of a renewed flare-up in cases, given their more protracted original lockdowns.
“We are not worried that the renewed lockdowns we expect in parts of Arizona, Texas, the Carolinas, Arkansas, and perhaps others, will be required elsewhere,” Ian Shepherdson, chief economist for Pantheon Macroeconomics, said in a note. “Far more people have been sick in the densely populated Northeast and Midwest than in most of the South, and lockdowns in major cities have been very long and painful.”
“Accordingly, we’re expecting people in the Northeast and Midwest to be much more cautious about maintaining social distancing, and to be more willing to wear masks in stores, on public transportation and at leisure facilities,” he added.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Meanwhile, White House economic director Larry Kudlow during CNN’s “State of the Union” on Sunday downplayed economic concerns posed by potential new waves of the coronavirus, saying, “There’s a very good chance you are going to get the V-shaped recovery,” and asserting growth would pick back up in the second half of the year. The remarks contrasted with some of the more cautionary outlooks from officials including Federal Reserve Chair Jerome Powell, who last week underscored the ongoing uncertainty created by the pandemic.” data-reactid=”24″>Meanwhile, White House economic director Larry Kudlow during CNN’s “State of the Union” on Sunday downplayed economic concerns posed by potential new waves of the coronavirus, saying, “There’s a very good chance you are going to get the V-shaped recovery,” and asserting growth would pick back up in the second half of the year. The remarks contrasted with some of the more cautionary outlooks from officials including Federal Reserve Chair Jerome Powell, who last week underscored the ongoing uncertainty created by the pandemic.
Kudlow also said the current $600-per-week unemployment payment paid out to some Americans who had lost their jobs during the pandemic as part of Washington’s sweeping coronavirus relief plan would end on schedule at the end of July, calling the program “a disincentive” for people to return to work.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Later this week, market participants are poised to receive new economic data on the retail trade and manufacturing sectors, which many economists believe will affirm an at least slight pick-up in activity from the doldrums of April.” data-reactid=”26″>Later this week, market participants are poised to receive new economic data on the retail trade and manufacturing sectors, which many economists believe will affirm an at least slight pick-up in activity from the doldrums of April.
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9:32 a.m. ET: Stocks open sharply lower
Here were the main moves in markets, as of 9:32 a.m. ET:
S&P 500 (^GSPC): -60.66 points (-1.99%) to 2,980.65
6:07 p.m. ET Sunday: Stock futures drop more than 1%
Here were the main moves at the start of the overnight session for U.S. equity futures, as of 6:07 p.m. ET:
S&P 500 futures (ES=F): 2,994.75, down 40 points or 1.32%
Dow futures (YM=F): 25,200.00, down 336 points, or 1.32%
Nasdaq futures (NQ=F): 9,542.75, down 102.25 points, or 1.06%
Traders wearing masks work, on the first day of in person trading since the closure during the outbreak of the coronavirus disease (COVID-19) on the floor at the New York Stock Exchange (NYSE) in New York, U.S., May 26, 2020. REUTERS/Brendan McDermid
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.
