Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


While you were sleeping: Caution ahead of earnings

While you were sleeping: Caution ahead of earnings

Jan 8 (BusinessDesk) – Wall Street retreated, pushing the Standard & Poor's 500 Index from its five-year high, as investors gear up for the fourth-quarter earnings season.

Profits at S&P 500 companies increased an average 2.9 percent in the fourth quarter, according to data compiled by Bloomberg. Excluding financial companies, earnings rose 0.5 percent.

Alcoa is the first company to report after the market closes on Tuesday. Shares were last down 1 percent.

In afternoon trading in New York, the Dow Jones Industrial Average dropped 0.58 percent, while the Standard & Poor's 500 Index shed 0.59 percent, and the Nasdaq Composite Index slid 0.41 percent.

"We have a cautious market entering fourth-quarter earnings season," Peter Cardillo, chief market economist at Rockwell Global Capital in New York, told Reuters. "I think it's going to be a disappointing one this time around."

Others are more optimistic.

“I’m expecting better-than-anticipated earnings," Tom Wirth, who helps manage US$1.6 billion as senior investment officer for Chemung Canal Trust, in Elmira, New York, told Bloomberg News.

Investors who prefer to play it relatively safe can snap up US government debt this week. The US is set to auction US$32 billion in three-year notes on Tuesday, US$21 billion in 10-year debt on Wednesday, and US$13 billion in 30-year bonds on Thursday.

“The auctions will go well at these levels,” David Ader, head of US government-bond strategy at CRT Capital Group in Stamford, Connecticut, told Bloomberg. “We’re finding a footing in here. We’ll probably get more of a concession.”

The KBW Bank Index was last 0.4 percent lower. Ten US mortgage servicers including Citigroup, Bank of America and JPMorgan agreed to pay a combined US$8.5 billion under a deal that will end case-by-case reviews of foreclosures.

In a statement, Bank of America agreed to a US$11.7 billion package aimed at resolving most mortgage disputes with Fannie Mae.

Meanwhile, banks won a reprieve of four more years to meet international liquidity requirements from global central bank chiefs in an effort help propel the pace of economic recovery.

Shares of Amazon gained, last up 3 percent, after Morgan Stanley upgraded the world’s largest online retailer.

In Europe, the Stoxx 600 Index ended the day with a 0.4 percent decline from the previous close, which was its highest level in nearly two years. National benchmark stock indexes also fell in London, Frankfurt and Paris, easing 0.4 percent, 0.6 percent and 0.7 percent respectively.

The euro, however, managed to hold above its 50-day moving average against the greenback, a positive sign. The single currency was last up 0.2 percent to US$1.3101.

“The euro simply didn’t break much lower and stayed quite nicely around the US$1.30 level,” Sebastien Galy, a senior foreign-exchange strategist at Societe Generale in New York, told Bloomberg. “The temptation therefore is to try to push it a little bit higher.”

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Gongs Got: Canon Media Awards & NZ Radio Awards Happen

Radio NZ: RNZ website The Wireless, which is co-funded by NZ On Air, was named best website, while Toby Manhire and Toby Morris won the best opinion general writing section for their weekly column on rnz.co.nz and Tess McClure won the best junior feature writer section. More>>

ALSO:

Pre-Budget: Debt Focus Risks Losing Opportunity To Stoke Economy

The Treasury is likely to upgrade its forecasts for economic growth in Budget 2016 next week but Finance Minister Bill English has already signalled that more of his focus is on debt repayment than on fiscal stimulus or tax cuts... More>>

ALSO:

Fulton Hogan's Heroes: Managing Director Nick Miller Resigns

Fulton Hogan managing director Nick Miller will leave the privately owned construction company after seven years in charge. The Dunedin-based company has kicked off a search for a replacement, and Miller will stay on at the helm until March next year, or until a successor has been appointed and a transition period completed. More>>

ALSO:

Gordon Campbell: On Electricity, Executions, And Bob Dylan

The Electricity Authority has unveiled the final version of its pricing plan for electricity transmission. This will change the way transmission prices (which comprise about 10% of the average power bill) are computed, and will add hundreds of dollars a year to power bills for many ordinary consumers. More>>

ALSO:

Half Empty: Fonterra NZ, Australia Milk Collection Drops In Season

Fonterra Cooperative Group says milk collection is down in New Zealand and Australia, its two largest markets, in the first 11 months of the season during a period of weak dairy prices. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news