U.S. stocks fell as traders assessed corporate earnings amid a resurgence in global coronavirus cases. Bonds rose.
The S&P 500 trimmed its monthly gain as worse-than-estimated results from McDonald’s Corp., 3M Co. and Harley-Davidson Inc. sent the shares slumping. Pfizer Inc. climbed after the drugmaker raised its earnings forecast and began a later-stage trial for a coronavirus vaccine with its German partner. Eastman Kodak Co. soared on news that it received a U.S. government loan.
Some of the largest companies report earnings this week, and investors will look for clues on whether a resurgence of COVID-19 around the world will derail a recovery of corporate profits and the economy. The Federal Reserve extended most of its emergency lending programs by three months, through the remainder of 2020. A drop in consumer confidence added to evidence that the pace of the rebound is cooling as the virus interrupts reopenings in several states.
“We’ve seen a number of beneficiaries of the lockdowns and a lot of companies really hurt by the lockdowns,” said Bill McMahon, chief investment officer of active strategies for Charles Schwab Investment Management. “There is still a lot of uncertainty about the rest of the year in how they guide.”
The pandemic continues to rage in parts of the U.S., hot spots in Europe and across big emerging economies including India and Brazil. With little prospect of a circuit breaker until a vaccine is discovered and distributed, governments are having to double down on the US$11 trillion dollars worth of stimulus and unprecedented central bank support unleashed since the crisis began. The Fed meets this week to decide on interest rates as U.S. lawmakers debate another US$1 trillion fiscal stimulus package.
“There’s enough stimulus and support in the market from a monetary policy perspective, but also from fiscal, and that keeps a nice floor under the market,” said Amanda Agati, chief investment strategist for PNC Financial Services Group. “But we also think it’s going to be very difficult to make a lot of forward progress in this environment.”
Nasdaq’s biggest companies may struggle to surpass a performance milestone from the height of the 1990s dot-com era, according to Julian Emanuel, head of equity and derivatives strategy at BTIG LLC.
The Nasdaq-100 was leading the S&P 500 for a 10th straight month as of Monday, according to data compiled by Bloomberg. If the Nasdaq-100 hangs onto the lead through Friday, it will match a record streak between May 1999 and February 2000 — the final months before both indexes peaked. The latest run is at risk because of “poor share-price reactions to otherwise solid earnings reports” and other issues, he wrote.
Here are some key events coming up:
The Federal Open Market Committee holds its policy meeting on Tuesday, with an announcement due on Wednesday.
Earnings include Rio Tinto and Barclays on Wednesday; Thursday brings Apple, Amazon.com, Alphabet, L’Oreal, Credit Suisse and Samsung; Chevron and Caterpillar are set for Friday.
U.S. second-quarter GDP is expected on Thursday.
China PMI data comes Friday.
These are some of the main moves in markets:
Stocks
The S&P 500 declined 0.2 per cent as of 12:39 p.m. New York time.
The Stoxx Europe 600 Index advanced 0.4 per cent.
The MSCI Asia Pacific Index climbed 0.5 per cent.
Currencies
The euro declined 0.2 per cent to US$1.1732.
The Japanese yen appreciated 0.3 per cent to 105.10 per U.S. dollar.
Bonds
The yield on 10-year Treasuries sank two basis points to 0.59 per cent.
Germany’s 10-year yield fell two basis points to -0.51 per cent.
Britain’s 10-year yield was unchanged at 0.109 per cent.
Commodities
The Bloomberg Commodity Index fell 0.1 per cent.
West Texas Intermediate crude decreased 1.3 per cent to US$41.06 a barrel.
Gold strengthened 0.3 per cent to US$1,948.05 an ounce.
—With assistance from Gregor Stuart Hunter, Andreea Papuc, Todd White, Lynn Thomasson, David Wilson and Amena Saad.
TORONTO – Cineplex Inc. reported a loss in its latest quarter compared with a profit a year ago as it was hit by a fine for deceptive marketing practices imposed by the Competition Tribunal.
The movie theatre company says it lost $24.7 million or 39 cents per diluted share for the quarter ended Sept. 30 compared with a profit of $29.7 million or 40 cents per diluted share a year earlier.
The results in the most recent quarter included a $39.2-million provision related to the Competition Tribunal decision, which Cineplex is appealing.
The Competition Bureau accused the company of misleading theatregoers by not immediately presenting them with the full price of a movie ticket when they purchased seats online, a view the company has rejected.
Revenue for the quarter totalled $395.6 million, down from $414.5 million in the same quarter last year, while theatre attendance totalled 13.3 million for the quarter compared with nearly 15.7 million a year earlier.
Box office revenue per patron in the quarter climbed to $13.19 compared with $12 in the same quarter last year, while concession revenue per patron amounted to $9.85, up from $8.44 a year ago.
This report by The Canadian Press was first published Nov. 6, 2024.
TORONTO – Restaurant Brands International Inc. reported net income of US$357 million for its third quarter, down from US$364 million in the same quarter last year.
The company, which keeps its books in U.S. dollars, says its profit amounted to 79 cents US per diluted share for the quarter ended Sept. 30 compared with 79 cents US per diluted share a year earlier.
Revenue for the parent company of Tim Hortons, Burger King, Popeyes and Firehouse Subs, totalled US$2.29 billion, up from US$1.84 billion in the same quarter last year.
Consolidated comparable sales were up 0.3 per cent.
On an adjusted basis, Restaurant Brands says it earned 93 cents US per diluted share in its latest quarter, up from an adjusted profit of 90 cents US per diluted share a year earlier.
The average analyst estimate had been for a profit of 95 cents US per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 5, 2024.
ST. JOHN’S, N.L. – Fortis Inc. reported a third-quarter profit of $420 million, up from $394 million in the same quarter last year.
The electric and gas utility says the profit amounted to 85 cents per share for the quarter ended Sept. 30, up from 81 cents per share a year earlier.
Fortis says the increase was driven by rate base growth across its utilities, and strong earnings in Arizona largely reflecting new customer rates at Tucson Electric Power.
Revenue in the quarter totalled $2.77 billion, up from $2.72 billion in the same quarter last year.
On an adjusted basis, Fortis says it earned 85 cents per share in its latest quarter, up from an adjusted profit of 84 cents per share in the third quarter of 2023.
The average analyst estimate had been for a profit of 82 cents per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 5, 2024.
