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

 

Errors Found: Electricity Authority Dumps Transmission Pricing Modelling

The Electricity Authority is ditching the cost-benefit analysis at the heart of its controversial attempt to find a new way to divide up costs for the national grid after finding an expanding range of serious computational errors in the work by Australian consultancy Oakley Greenwood. More>>

ALSO:

New Record: Migrant Arrivals At 129,500 A Year

Annual net migration has been steadily increasing since 2012. "This was mainly due to the rising number of migrant arrivals to New Zealand," population statistics senior manager Peter Dolan said. "Fewer migrant departures also contributed to the increase in net migration." More>>

ALSO:

Launched: NASA's Super Pressure Balloon Takes Flight From NZ

NASA successfully launched its football-stadium-sized, heavy-lift super pressure balloon (SPB) from Wanaka, New Zealand, at10:50 a.m. Tuesday, April 25 (6:50 p.m. April 24 in U.S. Eastern Time), on a mission designed to run 100 or more days floating at 110,000 feet (33.5 km) about the globe in the southern hemisphere's mid-latitude band. More>>

ALSO:

Trade Agreements: TPP Minus US Starting To Gain Ground

The Japanese government is picking up the pace on reviving the Trans-Pacific Partnership trade and investment deal, with talks scheduled next month among the 11 countries left in the pact after the withdrawal by the US after the election of president Donald Trump. More>>

ALSO:

PACER:

Prices Up 2.2%: Annual Inflation Highest In Over Five Years

"Rising petrol prices along with the annual rise in cigarette and tobacco tax lifted inflation," prices senior manager Jason Attewell said. "Petrol prices in New Zealand are closely linked to global oil prices, and cigarettes and tobacco taxes rise in the March quarter each year". More>>

ALSO:

Undertaxed? NZ Income Tax Rate Second Lowest Among Developed Nations

New Zealand workers pay the second smallest portion of their income to the government among developed nations and less than half the average ratio of their Organisation for Economic Cooperation and Development peers. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news