The stock markets in the United States recorded gains on Monday while investors wait for the data on employment and economic growth this week. Investors are still monitoring the financial performances of the companies for the third quarter.
James Dunnigan, chief investment officer of PNC Wealth Management told Bloomberg that the overall picture of corporate earnings is good and the path of least resistance continues to go up. He suggested that the valuations with the current level of the market are probably fair.
Dunnigan added, “As you get into year-end portfolio adjustments, playing on that momentum we’ll likely see the market continue to do well here as opposed to selling off. I think if there are any sort of corrections they’ll be short lived in this environment.”
Data compiled by Bloomberg showed that 76% of the 373 companies listed in the S&P 500 reported quarterly earnings that outperformed the estimates of Wall Street analysts.
In terms of employment, economists are projecting that employers added fewer jobs for the month of October. They suggested that the U.S. economy weakened during the third quarter. Based on the median forecast of 69 economists polled by Bloomberg, the annual growth rate of the country’s GDP was 2%, lower than the 2.5% annual GDP growth rate recorded in April to June this year.
- Dow Jones Industrial Average (DJIA)- 15, 639.12 (+0.15%)
- S&P 500- 1,767.93 (+0.36%)
- NASDAQ- 3,936.59 (+0.37%)
- Russell 2000- 1,107.65 (+1.09%)
- EURO STOXX 50 Price EUR- 3,061.18 (+0.31%)
- FTSE 100 Index- 6,763.62 (+0.43%)
- Deutsche Borse AG German Stock Index DAX- 9,037.23 (+0.33%)
Asia Pacific Markets
- Nikkei 225- 14, 201.57 (-0.88%)
- Hong Kong Hang Seng Index- 22,189.62 (-0.26%)
- Shanghai Shenzhen CSI 300 Index- 2, 380.45 (-0.19%)
Stocks in Focus
The stock price of BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) dropped by almost 17% to as low as $6.40 per share after Fairfax Financial Holdings Ltd (TSE:FFH) abandoned its $4.7 billion takeover proposal, and its CEO Thorsten Heins decided to leave the company. Fairfax CEO Prem Watsa disclosed that the consulting company working with his firm recommended against the transaction using borrowed money. Watsa said, “To load this company with too much debt was not appropriate.”
Groupon Inc (NASDAQ:GRPN) gained 6.39% to $10.57 per share after Goldman Sachs analyst Heath Terry wrote in a note to investors that the daily deals company will be able to post quarterly financial results that “modestly exceed” the expectations of Wall Street analysts. Terry maintained his Buy rating and $13 per share price target for the stock.
SYSCO Corporation (NYSE:SYY) surged 4.24% to $33.94 a share after reporting better-than-expected quarterly earnings. The food distributor to hospitals, restaurants, and schools delivered $0.49 earnings per share for its fiscal first quarter compared with the $0.47 earnings per share consensus estimate. The company generated $11.7 billion revenue, an increase of 5.7%.
On the other hand, the shares of Vulcan Materials Company (NYSE:VMC) climbed 7.66% to $57.78 per share after its third quarter financial results outperformed the consensus expectations of analysts. The company reported $0.32 earnings per share on $813.6 million revenue.