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Stock market news today: Stocks plummet, yields fall amid Credit Suisse turmoil

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U.S. stock were sharply lower Wednesday morning as two economic prints showed a slowdown in February, coupled with fresh turmoil at Credit Suisse (CS) that weighed on sentiment.

The S&P 500 (^GSPC) plunged 1.4%, while the Dow Jones Industrial Average (^DJI) fell 1.6%. Contracts with the technology-heavy Nasdaq Composite (^IXIC) dropped 1%.

Bond yields fell. The yield on the benchmark 10-year U.S. Treasury note moved down to 3.4% Wednesday morning from 3.6% Tuesday. On the front end of the yield curve, two-year yields fell to 3.8%. Oil fell to new lows on the year, with WTI falling more than 4% to below $70 a barrel.

All three major indexes rallied Tuesday as crucial inflation data came in line with expectations. The S&P 500 closed up 1.7%, while the Nasdaq climbed 2.3%, marking the index’s best day in five weeks. Shares of regional banks rebounded, clawing back some of the recent losses.

But fresh troubles at Credit Suisse injected more jitters into markets Wednesday. The European bank’s stock fell more than 20%, plunging to a record low after its biggest backer said it could not provide any more assistance. Credit Suisse on Tuesday disclosed in a report that it had identified “material weaknesses” in controls over financial reporting.

On the economic data side in the U.S., the Commerce Department said retail sales fell 0.4% over the last month, in line with the economist consensus complied by Bloomberg. Meanwhile, February’s producer-price index, which measures what suppliers are charging businesses, dropped 0.1% in an unexpected decline.

Wednesday’s data came after Tuesday’s release of the closely watched Consumer Price Index (CPI), which the Commerce Department said rose 6.0% in February over the last year, the smallest increase since September 2021. In the same survey, core CPI, which strips out food and energy, grew 5.5%, also in line with expectations.

The sudden collapse of Silicon Valley Bank and Signature Bank, as well as the emerging turmoil at Credit Suisse, comes at a time when the economy grapples with stickier, if declining, inflation. It has sparked the debate among traders betting on whether or not the Fed will hike interest rates after its meeting next week.

Ryan Sweet, Chief US Economist at Oxford Economics, said as stress is contained mostly in regional banks, his team expects a quarter-percentage-point rate increase following the Fed’s upcoming March meeting.

“With inflation continuing to run well above the 2% target, a pause in the tightening cycle or a rate cut would be premature,” Sweet wrote. “Policymakers can use tools other than interest rates to alleviate pressures in the banking system.”

A similar sentiment came from William Blair’s macro analyst Richard de Chazal, who said in light of current events a quarter-point increase will probably be deemed “more prudent.”

The banking sector received a vote of no confidence Tuesday as Moody’s downgraded the entire U.S. sector’s outlook from stable to negative, citing “the rapid deterioration in the operating environment.”

Bank sentiment continued to be sour for members of the KBW Bank index (^BKX), as the index sank Wednesday. Large-cap index members including Bank of America (BAC), JPMorgan Chase (JPM), Wells Fargo (WFC) and Citigroup (C) all traded down Wednesday, however.

Renewed jitters remained in the banking sector regional bank stocks on Wednesday — First Republic Bank (FRC), Western Alliance Bancorporation (WAL), PacWest Bancorp (PACW), Regions Financial (RF), and Zions Bancorporation (ZION) — all traded downward.

A logo is pictured on the Credit Suisse bank in Geneva, Switzerland, February 22, 2023. REUTERS/Denis Balibouse/

Here are other stocks trending on Yahoo Finance:

  • Credit Suisse (CS):The bank’s top shareholder ruled out offering further financial assistance to the lender. The shareholder cited regulatory concerns as the reason behind not being open to injecting more capital into the bank.
  • UBS Group AG (UBS): UBS chief executive officer Ralph Hamers said he will not answer any “hypothetical questions” following the turmoil at his rival Credit Suisse, Bloomberg reported.
  • Meta Platforms (META): Meta announced another 10,000 layoffs. The recruitment team is among those most affected by the job cuts, as the company plans to close 5,000 vacancies it had yet to fill. Citi boosted its target price to $260 from $228.
  • AMC Entertainment (AMC): The company said given a preliminary tally shareholders voted in favor of increasing the firm’s stock authorization and converting AMC Preferred Equity Units into common shares.
  • SentinelOne, Inc. (S): The cybersecurity company reported fourth quarter earnings that showed total revenue increased 92% to $126.1 million, up from the year before when it came in at $65.6 million.
  • 3M Company (MMM): The stock is trading lower ahead of the company’s investor day event.
  • Advanced Micro Devices (AMD): The stock outperformed on Tuesday overall for large-cap technology stocks, following three straight days of declines.

On the earnings front, Adobe (ADBE); Oatly (OTLY); UiPath (PATH); Five Below (FIVE) will report quarterly results on Wednesday.

Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv

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Telus prioritizing ‘most important customers,’ avoiding ‘unprofitable’ offers: CFO

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Telus Corp. says it is avoiding offering “unprofitable” discounts as fierce competition in the Canadian telecommunications sector shows no sign of slowing down.

The company said Friday it had fewer net new customers during its third quarter compared with the same time last year, as it copes with increasingly “aggressive marketing and promotional pricing” that is prompting more customers to switch providers.

Telus said it added 347,000 net new customers, down around 14.5 per cent compared with last year. The figure includes 130,000 mobile phone subscribers and 34,000 internet customers, down 30,000 and 3,000, respectively, year-over-year.

The company reported its mobile phone churn rate — a metric measuring subscribers who cancelled their services — was 1.09 per cent in the third quarter, up from 1.03 per cent in the third quarter of 2023. That included a postpaid mobile phone churn rate of 0.90 per cent in its latest quarter.

Telus said its focus is on customer retention through its “industry-leading service and network quality, along with successful promotions and bundled offerings.”

“The customers we have are the most important customers we can get,” said chief financial officer Doug French in an interview.

“We’ve, again, just continued to focus on what matters most to our customers, from a product and customer service perspective, while not loading unprofitable customers.”

Meanwhile, Telus reported its net income attributable to common shares more than doubled during its third quarter.

The telecommunications company said it earned $280 million, up 105.9 per cent from the same three-month period in 2023. Earnings per diluted share for the quarter ended Sept. 30 was 19 cents compared with nine cents a year earlier.

It reported adjusted net income was $413 million, up 10.7 per cent year-over-year from $373 million in the same quarter last year. Operating revenue and other income for the quarter was $5.1 billion, up 1.8 per cent from the previous year.

Mobile phone average revenue per user was $58.85 in the third quarter, a decrease of $2.09 or 3.4 per cent from a year ago. Telus said the drop was attributable to customers signing up for base rate plans with lower prices, along with a decline in overage and roaming revenues.

It said customers are increasingly adopting unlimited data and Canada-U.S. plans which provide higher and more stable ARPU on a monthly basis.

“In a tough operating environment and relative to peers, we view Q3 results that were in line to slightly better than forecast as the best of the bunch,” said RBC analyst Drew McReynolds in a note.

Scotiabank analyst Maher Yaghi added that “the telecom industry in Canada remains very challenging for all players, however, Telus has been able to face these pressures” and still deliver growth.

The Big 3 telecom providers — which also include Rogers Communications Inc. and BCE Inc. — have frequently stressed that the market has grown more competitive in recent years, especially after the closing of Quebecor Inc.’s purchase of Freedom Mobile in April 2023.

Hailed as a fourth national carrier, Quebecor has invested in enhancements to Freedom’s network while offering more affordable plans as part of a set of commitments it was mandated by Ottawa to agree to.

The cost of telephone services in September was down eight per cent compared with a year earlier, according to Statistics Canada’s most recent inflation report last month.

“I think competition has been and continues to be, I’d say, quite intense in Canada, and we’ve obviously had to just manage our business the way we see fit,” said French.

Asked how long that environment could last, he said that’s out of Telus’ hands.

“What I can control, though, is how we go to market and how we lead with our products,” he said.

“I think the conditions within the market will have to adjust accordingly over time. We’ve continued to focus on digitization, continued to bring our cost structure down to compete, irrespective of the price and the current market conditions.”

Still, Canada’s telecom regulator continues to warn providers about customers facing more charges on their cellphone and internet bills.

On Tuesday, CRTC vice-president of consumer, analytics and strategy Scott Hutton called on providers to ensure they clearly inform their customers of charges such as early cancellation fees.

That followed statements from the regulator in recent weeks cautioning against rising international roaming fees and “surprise” price increases being found on their bills.

Hutton said the CRTC plans to launch public consultations in the coming weeks that will focus “on ensuring that information is clear and consistent, making it easier to compare offers and switch services or providers.”

“The CRTC is concerned with recent trends, which suggest that Canadians may not be benefiting from the full protections of our codes,” he said.

“We will continue to monitor developments and will take further action if our codes are not being followed.”

French said any initiative to boost transparency is a step in the right direction.

“I can’t say we are perfect across the board, but what I can say is we are absolutely taking it under consideration and trying to be the best at communicating with our customers,” he said.

“I think everyone looking in the mirror would say there’s room for improvement.”

This report by The Canadian Press was first published Nov. 8, 2024.

Companies in this story: (TSX:T)

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TC Energy cuts cost estimate for Southeast Gateway pipeline project in Mexico

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CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.

It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.

The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.

Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.

TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.

The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:TRP)

The Canadian Press. All rights reserved.

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BCE reports Q3 loss on asset impairment charge, cuts revenue guidance

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BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.

The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.

On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.

“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.

“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”

Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.

BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.

The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.

BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.

It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.

The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”

Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.

This report by The Canadian Press was first published Nov. 7, 2024.

Companies in this story: (TSX:BCE)

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