Sharechat Logo

While you were sleeping: IBM disappoints

Thursday 20th April 2017

Text too small?

Wall Street was mixed, reflecting better-than-expected corporate earnings including from Morgan Stanley as well as disappointing results from IBM.

In 1.53pm trading in New York, the Dow Jones Industrial Average fell 0.3 percent. The Nasdaq Composite Index, however, rose 0.5 percent. In 1.38pm trading, the Standard & Poor’s 500 Index added 0.1 percent.

"It's really a battle between geopolitical headlines and earnings right now, and for the most part earnings seem to be winning in the short term," Jeff Zipper, managing director of investments at the Private Client Reserve of US Bank in Palm Beach Florida, told Reuters. 

The Dow fell as shares of IBM dropped, recently down 4.5 percent. Shares of Chevron also declined, down 1 percent recently.

IBM posted revenue that disappointed analysts, raising questions about the company’s outlook. 

“In 2016, they were really on a winning streak both in terms of stock performance and in terms of beating street expectations on revenue,” Greg McDowell, an analyst at JMP Securities, told Bloomberg. “When a company that size has a streak and that streak comes to an end, investors really want to dig into the underlying reasons.”

On the flipside, shares of Morgan Stanley rose, trading 2.8 percent stronger as of 1.54pm in New York, as the bank posted stronger-than-expected earnings bolstered by bond trading revenue.

Keeping a lid on gains, investors are closely watching developments on tensions between the US and North Korea as well as the first round of French elections, slated for Sunday.

“We’re still hugely vulnerable to political risks,” Christopher Jeffery, asset allocation strategist at Legal & General Investment Management in London, told Bloomberg. “Polling for the first round of the French election is hugely tight. We have no clear indication of how the drama in North Korea will play out. And those factors are more important to us than the ebb and flow of earnings news in the short term.”

Meanwhile, the US economy grew at a pace "equally split between modest and moderate" between mid-February and the end of March, the Federal Reserve said in its Beige Book report. 

“In addition, the pickup was evident to varying degrees across economic sectors,” the Fed noted. “On balance, prices rose modestly.” 

In Europe, the Stoxx 600 Index ended the day with a 0.2 percent advance from the previous close. Germany’s DAX Index rose 0.1 percent, while France’s CAC40 Index gained 0.3 percent.

The UK’s FTSE 100 Index slid 0.5 percent.

Shares of Burberry Group dropped 7.9 percent in London after the UK luxury retailer reported fourth-quarter retail comparable sales that failed to meet expectations.






  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Heartland announces FY20 full year results
Geo Limited releases its FY20 Annual Report
Michael Hill International Limited announces 2020 annual report
Tower supports climate risk reporting
Tourism Holdings Limited Updated FY20 guidance
The Bankers Investment Trust Plc- Issue of Equity
Oio Consents to Acquisition of Metlifecare
Summerset Considers Retail Bond Offer
Z seeks previous corporate employees for remediation payment
SkyCity Announces Full Year Results

IRG See IRG research reports