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

 


While you were sleeping: Meagre earnings outlook

While you were sleeping: Meagre earnings outlook

Jan 22 (BusinessDesk) – After a long weekend, Wall Street returned with a sombre mood as the earnings outlook from companies including Johnson & Johnson and Verizon failed to justify current valuations.

Shares of Johnson & Johnson dropped, last 2 percent weaker, after its earnings outlook fell short of expectations.

The outlook reflects “some level of conservatism—in line with historical guidance—given still seemingly weak though potentially stabilising MedTech utilisation trends,” Danielle Antalffy, an analyst at Boston-based Leerink Partners, said in a note today, Bloomberg News reported.

In afternoon trading in New York, the Dow Jones Industrial Average fell 0.43 percent and the Standard & Poor’s 500 Index was up 0.08 percent. The Nasdaq Composite Index advanced 0.43 percent. US markets were closed on Monday for the Martin Luther King holiday.

Slides in shares of Verizon Communications, last down 2.7 percent, and those of Goldman Sachs, last down 2.6 percent, propelled the Dow lower.

“In the short term, continued earnings growth is particularly important,” James Gaul, a portfolio manager at Boston Advisors, told Bloomberg News. “We are no longer cheap, perhaps not even fairly valued at this point. Investor sentiment is quite optimistic. We need some positive news to get us going.”

Shares of Alcoa climbed, last up 7.2 percent to US$12.18. JP Morgan upgraded the stock to an "overweight" from a neutral" rating and boosted its price target to US$15 from US$9 per share.

The International Monetary Fund lifted its estimate for global growth this year, predicting the economy will expand 3.7 percent, up from an October estimate of 3.6 percent, and accelerate to 3.9 percent in 2015, according to its latest World Economic Outlook, released today.

Even so, the IMF also warns central banks including the US Federal Reserve against “prematurely withdrawing monetary policy accommodation.”

“Strengthening global growth does not mean that the global economy is out of the woods,” the IMF said in a statement. “Output gaps are still large while inflation is low, and that fiscal consolidation will continue. The WEO Update warns of underestimating the need for stronger growth, as more balance sheet repair after the crisis is still required.”

Separately, the annual PricewaterhouseCoopers survey of more than 1,300 CEOs showed 39 percent were "very confident" their company's revenues would grow in 2014, up from 36 percent a year ago, according to Reuters. Some 44 percent expect the global economy will improve in the next 12 months, compared with 18 percent a year ago.

Europe’s Stoxx 600 Index finished the session nearly 0.1 percent higher than the previous close, as did France’s CAC 40. Germany’s DAX added 0.2 percent. The UK’s FTSE 100 inched less than 0.1 percent lower.

In Germany, investor confidence took a surprise tumble in January. The ZEW Center for European Economic Research said its index of investor and analyst expectations slid to 61.7 this month, down from 62 in December.

However, the IMF is more optimistic about the euro zone’s outlook in its World Economic Outlook, predicting growth will strengthen to 1 percent in 2014 and 1.4 percent in 2015.

“The euro area is turning the corner from recession to recovery,” the IMF said in a statement.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Sky City : Auckland Convention Centre Cost Jumps By A Fifth

SkyCity Entertainment Group, the casino and hotel operator, is in talks with the government on how to fund the increased cost of as much as $130 million to build an international convention centre in downtown Auckland, with further gambling concessions ruled out. The Auckland-based company has increased its estimate to build the centre to between $470 million and $530 million as the construction boom across the country drives up building costs and design changes add to the bill.
More>>

ALSO:

RMTU: Mediation Between Lyttelton Port And Union Fails

The Rail and Maritime Union (RMTU) has opted to continue its overtime ban indefinitely after mediation with the Lyttelton Port of Christchurch (LPC) failed to progress collective bargaining. More>>

Earlier:

Science Policy: Callaghan, NSC Funding Knocked In Submissions

Callaghan Innovation, which was last year allocated a budget of $566 million over four years to dish out research and development grants, and the National Science Challenges attracted criticism in submissions on the government’s draft national statement of science investment, with science funding largely seen as too fragmented. More>>

ALSO:

Scoop Business: Spark, Voda And Telstra To Lay New Trans-Tasman Cable

Spark New Zealand and Vodafone, New Zealand’s two dominant telecommunications providers, in partnership with Australian provider Telstra, will spend US$70 million building a trans-Tasman submarine cable to bolster broadband traffic between the neighbouring countries and the rest of the world. More>>

ALSO:

More:

Statistics: Current Account Deficit Widens

New Zealand's annual current account deficit was $6.1 billion (2.6 percent of GDP) for the year ended September 2014. This compares with a deficit of $5.8 billion (2.5 percent of GDP) for the year ended June 2014. More>>

ALSO:

Still In The Red: NZ Govt Shunts Out Surplus To 2016

The New Zealand government has pushed out its targeted return to surplus for a year as falling dairy prices and a low inflation environment has kept a lid on its rising tax take, but is still dangling a possible tax cut in 2017, the next election year and promising to try and achieve the surplus pledge on which it campaigned for election in September. More>>

ALSO:

Job Insecurity: Time For Jobs That Count In The Meat Industry

“Meat Workers face it all”, says Graham Cooke, Meat Workers Union National Secretary. “Seasonal work, dangerous jobs, casual and zero hours contracts, and increasing pressure on workers to join non-union individual agreements. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news