Market News: American Express, Capital One, Morgan Stanley

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The stock markets in the United States fluctuated as investors evaluate the earnings results of corporations today. The S&P 500 and Nasdaq declined while the Dow Jones Industrial Average (DJIA) slightly gained by end of the trading session on Friday.

Jim Russell, senior equity strategist at U.S. Bank Wealth Management told Bloomberg, “Investors are taking cues from earnings releases. Just as important as fourth quarter earnings are, many investors are watching for company guidance for signs on what early 2014 will bring.” He added, “This year, we’ll see a tearing between winners and losers and we’ve seen that in this earnings season so far.”

Data from Bloomberg showed that analysts estimated that the earnings per share of companies listed in the S&P 500 probably gained an average of 6% in the fourth quarter. Today, seven companies in the benchmark posted financial results.

According to Wayne Wilbanks, chief investment officer at Wilbanks, Smith & Thomas Asset Management LLC, the earnings are okay, but “the markets just can’t seem to get going this year.” He added that earnings should be really good for the markets to go much higher.

Meanwhile, the January preliminary report of Thomson Reuters/University of Michigan index of consumer sentiment showed an unexpected decline.

U.S. Markets

  • Dow Jones Industrial Average (DJIA)- 16,444.05 (+0.16%)
  • S&P 500- 1,838.73 (-0.39%)
  • NASDAQ- 4,197.08 (-0.51%)
  • Russell 2000- 1,167.18 (-0.51%)

European Markets

  • EURO STOXX 50 Price EUR- 3,154.10 (+0.12%)
  • FTSE 100 Index- 6,829.30 (+0.64%)
  • Deutsche Borse AG German Stock Index DAX- 9,742.96 (+0.26%)

Asia Pacific Markets

  • Nikkei 225- 15,734.46 (-0.08%)
  • Hong Kong Hang Seng Index- 23,133.35 (+0.64%)
  • Shanghai Shenzhen CSI 300 Index- 2,178.49 (-1.51%)

Stocks in Focus

The stock price of American Express Company (NYSE:AXP) climbed more than 4% to as much as $93.62 a share on Friday. The stock was lifted to an all-time high after reporting a profit increase of 105% to $1.3 billion or $1.21 earnings per share. The credit card provider said improved credit quality and lower write-offs contributed to its outstanding results.

American Express CEO Kenneth Chenault said, “Credit quality indicators are at historically strong levels and, while many consumers are still cautious about taking on additional debt, we again saw a modest increase in card member loans this quarter.”

The shares of Capital One Financial Corp. (NYSE:COF) declined more than 5% to as low as $72.29 per share today after posting fourth quarter earnings that missed analysts’ expectations. Capital One reported $1.45 earnings per share lower than the estimated $1.55 earnings per share. Its total revenue declined by 10% to $3.4 billion.

On the other hand, the stock value of Morgan Stanley (NYSE:MS) surged nearly 4% to as high as $33.52 a share after delivering better-than-expected profits. The company said its revenues from equity trading and wealth management were strong. The owner of the world’s largest brokerage reported $0.50 earnings per share and $7.83 billion revenue compared with analysts’ estimates of $0.42 earnings per share and $7.99 billion revenue in the fourth quarter.

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