The stock markets in the United States declined again today, which was primarily caused by the slumped in biotechnology and media equities.
Commenting on the market trends, Walter Todd, chief investment officer at Greenwood Capital Associates told Bloomberg, “It’s like panic buying and panic selling. The reactions you’re seeing in the marketplace are just very violent for companies reporting earnings, sometimes to the upside, sometimes to the downside.”
According to Bloomberg, around 85% of companies listed on the S&P 500 already reported its quarterly financial results. Seventy-five percent (75%) of those companies posted earnings that beat estimates while 50% reported better-than-expected sales.
Aside from corporate earnings, investors are also monitoring economic data to determine the time of the interest rate hike by the Federal Reserve. Today, the Department of Labor reported that the number of people who filed for unemployment benefits increased by 3,000 to 270,000 for the week ended August 1.
Millan Mulraine, deputy head of research and strategy at TD Securities (USA) commented, “The labor market stands in a fairly healthy position. The economic recovery has regained some positive momentum and that’s likely to translate into further acceleration in job growth in the next few months.”
The Department of Labor is scheduled to release its jobs report on Friday. Economist estimated that the economy added 225,000 jobs last month and the unemployment rate remained at 5.3%.
- Dow Jones Industrial Average (DJIA) – 17,419.75 (-0.69%)
- S&P 500- 2,083.56 (-0.78%)
- NASDAQ- 5,056.44 (-1.62%)
- Russell 2000- 1,215.88 (-1.29%)
- EURO STOXX 50 Price EUR- 3,668.47 (-0.23%)
- FTSE 100 Index- 6,747.09 (-0.08%)
- Deutsche Borse AG German Stock Index DAX- 11,585.10(-0.44%)
- Nikkei 225- 20,664.44 (+0.24%)
- Hong Kong Hang Seng Index- 24,375.28 (-0.57%)
- Shanghai Shenzhen CSI 300 Index- 3,831.85 (-0.91%)
Stocks in Focus
Twenty-First Century Fox declined more than 6% to $29.06 per share. The company posted adjusted quarterly earning of $0.39 per share, higher than the $0.37 per share expected by analysts. Its revenue was $6.2 billion, lower than the $6.4 billion estimated by analysts.
The stock price of Viacom plummeted more than 24% to $44.1o per share. The owner of MTV, Nickelodeon and Comedy Central reported earnings of $1.47 per share on $3.05 billion in revenue. Analysts expected the company to deliver earnings of $1.48 per share on $3.28 billion in revenue.
Keurig Green Mountain plunged more than 29% to $52.67 per share. The company was negatively impacted by its weak financial performance and job cuts. Analysts at Canaccord Genuity downgraded its stock rating to Hold and reduced its price target to $65 from $120 per share. UBS analysts also recommended a Neutral rating and cut its price target to $59 from $86 per share.