Jul 31 2015

Disappointing earnings offset strong GDP report

Market Recap 07/30/15:
 
U.S. stocks ended flat on Thursday, with a number of high-profile names – including Procter & Gamble (PG) and Facebook (FB) – dropping after disappointing quarterly results. While a read on economic growth came in above expectations, some investors viewed that data cautiously, as the Federal Reserve has indicated it will raise rates when economic data suggests the economy is strong enough to withstand a rate hike. Comments from the central bank earlier this week reiterated that an increase could come this year – though investors are split on whether September or December is more likely. With earnings growth tepid and Chinese growth still a concern, investors are finding few reasons to keep pushing shares higher.
 
Looking ahead:
 
Futures are flat on Friday, though major indexes look to end a volatile month with gains. The Energy sector will be in view, with earnings set from both Exxon Mobil (XOM) and Chevron (CVX). While the two Dow components could see a hit from lower oil prices, both firms are diversified energy plays, meaning the impact won’t be as pronounced as in other names in the space. Expedia (EXPE) share are up in premarket; the online travel agency reported strong earnings after the market closed on Thursday. On the economic data front, the final July reading of the University of Michigan’s index on consumer sentiment will be released after the market open. Make sure you don’t miss this week’s Money Matters with Gary Goldberg, Sunday at 11 AM on WOR 710 AM Radio. Visit our websitewww.ggfs.com for more details.

Jul 30 2015

The Fed acknowledges improvement in domestic economy

7/29/15 Market Recap: 

U.S. stocks rose on Wednesday, boosted after the Federal Reserve acknowledged improvement in the domestic economy but held off on raising interest rates. While many investors still expect the central bank’s first rate hike in about 10 years to come in 2015, the comments indicated that the Fed was willing to remain accommodative amid some potential market headwinds. Market participants are still closely watching the volatile Chinese market, which have dropped sharply in recent days, underlining concerns about the pace of global growth and the demand for commodities like oil and base metals. Separately, the second-quarter earnings season has contained some disappointments, with revenue down almost 4 percent from the year-ago period. However, there have been some bright spots, with General Dynamics (GD) rallying after its results on Wednesday. The session’s gains were broad, with all ten primary S&P 500 sectors higher on the day.


Looking Ahead: 

Futures are little changed on Thursday, with investors looking ahead to a read on second-quarter economic growth to add further context to the Fed’s comments on the economy from Wednesday. A couple of high-profile names could pressure the market, with both Facebook (FB) and Whole Foods Market (WFM) down after results that were reported after the market closed on Wednesday. Whole Foods dropped sharply as its earnings missed expectations. While Facebook’s profit was higher than anticipated, the growth was not seen as strong enough to justify the social media giant’s valuation following a year-to-date gain of more than 20 percent. Cigna (CI) and Time Warner Cable (TWC) are among the companies reporting on Thursday. On the economic data front, both the GDP data and weekly jobless claims will be released before the bell.

Make sure you don’t miss this week’s Money Matters with Gary Goldberg, Sunday at 11 AM on WOR 710 AM Radio. Visit our website www.ggfs.com for more details.

 

Jul 29 2015

Futures are modestly higher

7/28/15 Market Recap: 

U.S. stocks rose sharply on Tuesday, rebounding from the previous session’s sharp decline as some strong corporate results offset ongoing concerns over the pace of economic growth in China. While Shanghai’s primary equity index fell, extending its decline on Monday – which had been the single worst session for the index in several years – the decline was relatively muted. While China is expected to remain volatile – which could mean large swings in Energy shares and commodity prices as the country’s growth is heavily tied to global demand – some bullish news from corporate America lifted sentiment. Ford Motor Co (F) reported stronger-than-expected earnings growth, helped by a rebound in the automaker’s U.S. division, while Dow component Pfizer (PFE) lifted its full-year outlook. In the latest economic data, U.S. consumer confidence fell more than expected in July, while home prices rose a robust 4.4 percent in May.


Looking Ahead: 

Futures are modestly higher, but trading could be quiet until the end of the Federal Reserve’s two-day meeting Wednesday afternoon. In a statement, the U.S. central bank will announce a decision on interest rates, and while the Fed isn’t seen raising rates at this meeting, it is widely expected to at some point in 2015. The Fed statement will be closely scrutinized for any indication about whether the rate hike will come in September or December. Overseas, a rally in Chinese shares could ease some near-term anxiety about the region, though ongoing volatility there could result in in big price swings here. Pending home sales are scheduled for release on Wednesday, while on the earnings front, Cliffs Natural Resources (CLF) and Mastercard (MA) are among the companies reporting.

Make sure to tune into Fox Business this Thursday at 6 PM when our President, Oliver Pursche, joins Charles Payne during the 6 o’clock hour to give our latest outlook and discusses why, in spite of the recent negative market action, we remain cautiously optimistic. And don’t miss this week’s Money Matters with Gary Goldberg, Sunday at 11 AM on WOR 710 AM Radio. Visit our website www.ggfs.com for more details

 

Jul 28 2015

Pressure by massive selloff in the Chinese market

7/27/15 Market Recap:

U.S. stocks fell sharply in Monday’s session, pressured by a massive selloff in the Chinese market that raised new concerns about the pace of global growth and whether China’s slowing economy would have a pronounced impact on corporate earnings and revenue growth domestically. China’s primary stocks index fell more than 8 percent on the day, its biggest one-day drop in eight years. While the country’s top regulator said Beijing would continue previously announced plans to stabilize the market, investors sold riskier assets like stocks in masse. The day’s losses were broad but led by the Energy sector, with traders anticipating that China’s weakness would result in lower demand for commodities. A rare bright spot in the market came from Teva Pharmaceuticals (TEVA), which agreed to buy Allergan’s generic drug business for $40.5 billion.


Looking Ahead:

Futures are modestly higher on Tuesday in a rebound from the previous session’s decline, though the situation in China will continue to be closely monitored. The losses there continued, with the main Shanghai index extending Monday’s selloff by dropping 1.7 percent, but the recent volatility on Wall Street could mean that the bulk of the current situation has been priced into shares. Investors are also looking ahead to a two-day meeting by the U.S. Federal Reserve, which begins Tuesday and ends Wednesday, when the central bank will announce a decision on interest rates. While the Fed isn’t expected to raise rates this week, it could give further insight into whether an increase will come in September or December, as it is widely expected to hike rates in 2015. On the earnings front, Ford (F), United Parcel Services (UPS) and Jetblue Airways (JBLU) are all set to report, as is Dow component Pfizer (PFE). On the economic data front, the Case-Shiller index on home prices will be released before the market opens, while a read on July consumer confidence will come out after the open. Make sure to tune into Fox Business this Thursday at 6 PM when our President, Oliver Pursche, joins Charles Payne during the 6 o’clock hour to give our latest outlook and discusses why, in spite of the recent negative market action, we remain cautiously optimistic. And don’t miss this week’s Money Matters with Gary Goldberg, Sunday at 11 AM on WOR 710 AM Radio. Visit our website www.ggfs.com for more details.

 

Jul 27 2015

Weak results add concerns regarding strength of the global economy

7/24/15 Market Recap:

U.S. stock indexes ended their worst week since March with further losses on Friday, pressured by the latest in a series of weaker-than-expected earnings as well as signs of slowing global growth. Biogen Idec (BIIB) shares plummeted after the biotechnology giant cut its revenue growth forecast for 2015 by more than half, an outlook that weighed on the overall biotech sector. While more companies than usual have been topping earnings expectations thus far this quarter, including some big names like Amazon.com (AMZN) and Visa (V), revenue growth has been weak, and Biogen follows Apple (AAPL) and Microsoft (MSFT) as a bellwether name to disappoint. The weak results have added to concerns about the strength of the global economy, with some tepid data from both China and the euro zone adding to these fears on Friday. Energy and Material shares were especially weak at the close of last week, with investors concerned that weak grow would decrease demand for commodities like oil and copper.


Looking Ahead:

Futures are lower on Monday, with investors still taking their cue from overseas markets. Chinese equities plummeted, with the Shanghai Composite Index down more than 8 percent on the day, the biggest one-day drop since 2007. Such weakness suggests equities markets will remain volatile, and that recent moves by Beijing to shore up its markets may be inadequate. The uncertainty will have an outsized impact on U.S. commodity names, which could decline on any further hint of weakening global demand. Large-cap names in general, which have more direct revenue exposure to overseas markets than their smaller peers, could also see weakness. Investors also continue to study second-quarter earnings results, which have included some high-profile disappointments, raising concerns about U.S. growth and market valuation. Norfolk Southern (NSC) and Plum Creek Timber (PCL) are among the names set to report on Monday. On the economic data front, June durable goods will be released before the market open.  Make sure to tune into Fox Business this Thursday at 6 PM when our President, Oliver Pursche, joins Charles Payne during the 6 o’clock hour to give our latest outlook and discusses why, in spite of the recent negative market action, we remain cautiously optimistic. And don’t miss this week’s Money Matters with Gary Goldberg, Sunday at 11 AM on WOR 710 AM Radio. Visit our website www.ggfs.com for more details.

 

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