Pinterest’s (PINS) stock jumped nearly 28% in after-hours trading Wednesday following a major sales beat.
The social media company reported $443 million in revenue for the three months ended Sept. 30, up 58% from the same period in the prior year and well above Wall Street analysts’ projected quarterly revenue of $383.5 million.
Pinterest has experienced a big boost from the coronavirus pandemic. On Wednesday, it reported a 37% jump in global monthly active users to 442 million, and a 15% increase in global average revenue per user during the quarter.
The company is still working to achieve consistent profitability since going public last year, but analysts last month forecasted that Pinterest will post a small profit for 2020 and expect earnings to surge in 2021. The company on Wednesday reported a net loss of $94 million during the September quarter — a 24% improvement from the net loss it posted during the same period in the prior year.
As of market close Wednesday, the company’s stock had risen nearly 162% since the start of this year, outpacing gains by other social media players including Facebook (FB) and Twitter (TWTR).
It was another ugly day for Wall Street and the second sharp selloff of the week. Worries about rising coronavirus infections, a retightening of pandemic restrictions in Europe, as well as uncertainty about the election and future stimulus to boost the economy have investors in a vice.
The Dow closed 3.4%, or 943 points, while the broader S&P 500 ended 3.5% lower.
It was the worst performance since June for both indexes.
The Nasdaq Composite closed 3.7% lower, its worst day since early September.
Solar energy leader First Solar (FSLR) is one of the few bright spots in the market sky Wednesday. Shares soared more than 10% after the company reported better-than-expected revenue and earnings after the closing bell Tuesday.
First Solar’s stock is now up about 65% this year. The entire industry is on fire in 2020. The Invesco Solar ETF (TAN) has more than doubled in 2020.
This rally is in part due to hopes that a potential Joe Biden presidency and possible blue wave in the Senate will lead to more federal government investments in solar and other forms of alternative energy – even though Biden has said he does not specifically endorse the Green New Deal plan proposed by the more progressive Democrats in Congress.
First Solar did not address the US political outlook in its conference call with analysts Tuesday, but CEO Mark Widmar did (perhaps tellingly) note that a so-called Green Deal in Europe has benefited the company.
“The Green Deal, which could make solar the number one source of electricity in Europe by 2025 is an example of how political leaders are bundling post-pandemic economic recovery with decarbonization commitments,” he said.
Welcome to the afternoon portion of this selloff: The Dow is now down 900 points, or 3.3%.
Ouch.
The broader S&P 500 is 3.2% lower, while the Nasdaq Composite has tumbled 3.4%.
Things are really not getting better. Uncertainty is the name of the game and that won’t change anytime soon.
The market looks a mess today but at least the selloff isn’t gathering much more steam at midday.
“If you ask three people you hear three different reasons for why the market is selling off,” said Nancy Tengler, chief investment strategist at Tengler Wealth Management, on the CNN Business digital live show Markets Now.
Uncertainty about the election outcome next week, further government stimulus and rising Covid-19 infections are weighing on the market. It’s already the second selloff of the week, and it might not be the last.
“We will continue to see volatility for at least the next few weeks and maybe longer than that,” Tengler said.
But this might also be an opportunity for buyers, although Tengler advises her clients not to “invest your politics.”
The outlook for US stocks, however, is good, she said. At the end of the day there is little attractive alternative to the US equity market, and the lagged effects of government stimulus will also continue to feed through, she said.
The election is coming closer, but first comes Halloween. This year, society might need that escape more than ever.
Retailer Spirit Halloween is seeing the benefits of this. The retailer has opened more stores than every before – some 1,400 – to keep up with demand.
But of course the pandemic has changed things. “We’re getting better real estate, more prominent real estate,” the company’s CEO Steven Silverstein said. But at the same time, the company has had to close its in-store fitting rooms.
The election is only six days out. Investors are nervous.
“I think we are witnessing a real change on what investors are looking for,” said Tina Fordham, head of global political strategy at Avenhurst.
Clarity on election results sooner rather than later is particularly important for investors, Fordham told Alison Kosik on the CNN Business digital live show Markets Now.
One of the biggest drivers of the US stock market has been government stimulus to get the economy back on track.
“Investors are looking for stimulus, and they’re more likely to get that if there’s a so-called ‘blue wave’,” Fordam said.
Europe’s stock markets closed deep in the red today. Britain’s FTSE 100 closed down 2.6%, while Germany’s DAX fell nearly 4.2%. In France, the CAC 40 dropped 3.4%.
A rapid rise in Covid-19 infections across Europe is leading governments to bring back restrictions.
In France, local media, including the newspaper Le Monde, report that a new lockdown will be announced by the president in an address to the nation at 8 pm local (3 pm ET) today. CNN affiliate BFMTV reports that the new measures may last four weeks and come into force as early as Thursday evening.
Meanwhile, Germany’s Robert Koch Institute Wednesday reported a record-high 14,964 new daily coronavirus infections in 24 hours. German media outlets report more severe restrictions on public life starting Monday, including the closures of restaurants and a maximum 10 people for private gatherings between two households.
Aerospace giant Raytheon Technologies (RTX) says it received a criminal subpoena from the Department of Justice seeking information related to its financial accounting and reporting practices.
Raytheon disclosed in its quarterly earnings filing Tuesday that it received the subpoena on October 8. DOJ is seeking “information and documents in connection with an investigation relating to financial accounting, internal controls over financial reporting, and cost reporting regarding Raytheon Company’s Missiles & Defense business since 2009.”
The company said it is “cooperating fully” and does not currently believe the investigation will have a “material adverse effect on our financial condition, results of operations or liquidity.”
Neither the company nor the DOJ responded immediately to a request for comment.
Raytheon’s stock fell around 4% on Wednesday. Shares are down around 40% this year as the company grapples with the massive pandemic-fueled hit to the commercial air travel business.
The stock decline also followed a mixed earnings report Tuesday — Raytheon beat analysts’ earnings projections but missed on sales. The company reported 34% year-over-year sales declines in both its Collins Aerospace and Pratt & Whitney divisions.
Few stocks were spared in Wednesday’s market rout. But investors in Netflix (NFLX) may be chilling today. The streaming giant’s shares were up slightly, making it just one of two Nasdaq 100 stocks in green. ADP (ADP) was the other, surging 6% on solid earnings. Only 19 stocks in the S&P 500 were higher as well.
Netflix, unlike other big techs such as Facebook (FB), Amazon (AMZN) and Google owner Alphabet (GOOGL), has largely avoided the regulatory and antitrust scrutiny that has afflicted the other FAANG stocks.
Netflix has benefited from the stay-at-home trend during the Covid-19 pandemic. And despite mounting competition from the likes of Disney (DIS), Apple (AAPL) and CNN/HBO owner AT&T (T) and concerns about slowing subscriber growth, Netflix shares are still up more than 50% in 2020.
Today is messy for the markets but the economic calendar is actually rather quiet. Tomorrow, that’s going to be very different.
As every Thursday, we’ll get the Labor Department’s report on weekly jobless claims. Economists expect to see another 775,000 seasonally-adjusted first-time claims for unemployment benefits. That would be marginally less than the prior week, when initial claims fell below 800,000 for the first time since March.
But these numbers don’t tell us the whole story. For example, they don’t include claims for Pandemic Unemployment Assistance, which is available for workers that aren’t eligible for regular jobless benefits, such as the self-employed.
Continued claims for benefits are expected at 7.7 million, which would be more than half a million less than the prior week. But again, the devil’s in the details: Unemployed workers have increasingly been maxing out their state benefits and subsequently rolling onto other government programs like Pandemic Emergency Unemployment Compensation.
Jobless claims continue to be an important indicator of how the recovery is going, but it won’t be the biggest report tomorrow.
The Commerce Department will also publish the first look at how the economy fared during the third quarter, in terms of gross domestic product. A big bounce from the second quarter’s decline is expected, even though the economy isn’t out of the woods yet.
In-person vet visits may be more daunting for pet owners during the pandemic, so pet supplier company Chewy (CHWY) is trying to make things smoother with a new telehealth service.
The service will serve as a triage platform to connect pet owners to licensed veterinarians. The vets won’t be able to virtually diagnose medical conditions, provide treatment or prescribe medications. It launched in Florida and Massachusetts in May. It has now expanded to 35 states, and Chewy plans to offer it nationwide.
The global veterinary telehealth market is valued at more than $60 million, and it is expected to grow to nearly $290 million by 2028, according to InsightAce Analytic, a market research and consulting company.
“We have focused our efforts into developing an easy to use and convenient tele-triage product that we anticipate will have a positive impact given the current environment, and also extend beyond that,” Sumit Singh, CEO of Chewy, said in a press release. He added that the vet community has also been impacted by clinic shutdowns or reduced clinic owners, so this service will benefit both communities.
Well, that was quick. The Dow is now more than 860 points lower. That’s almost 3.1%. Phew.
It’s that kind of day.
The S&P 500 is down 3.1%, and the Nasdaq Composite is down 3.2%.
For context, if the market closed right now, it would be the index’s worst day in four and a half months – since June 11, when the Dow fell 6.9%.
The S&P and the Nasdaq are looking at their worst day since early September.
The market hasn’t even been open an hour, and the stocks dashboard looks crimson.
The Dow is down 700 points, or more than 2.6%, mid-morning. The broader S&P 500 fell 2.7%.
The Nasdaq Composite is down 2.9%.
It’s looking like a rough day for the market, which has had to grapple with rising coronavirus infections and election uncertainty over the past weeks. With Election Day only six days away, anxiety has taken over the market.
Stocks are in the toilet today as rising Covid-19 infections around the world spark worries about renewed lockdowns.
That’s why, say analysts at Bespoke Investments, investors should look closely at what’s in their portfolio – and maybe add some “pandemic-safe” stocks to their collection.
Bespoke’s list of stocks for the Covid-19 economy include remote work-friendly companies like Slack (WORK), Peloton (PTON), Amazon (AMZN) and Netflix (NFLX), consumer staples like Johnson & Johnson (JNJ) and Procter & Gamble (PG), and telehealth business Teladoc (TDOC).
The oil market is once again getting rocked by the pandemic.
US oil prices tumbled nearly 6% Wednesday morning to $37.40 a barrel. Brent crude, the global benchmark, similarly lost 5%, breaking below $40. Both oil contracts are trading near four-month lows.
The selloff, much like the one in the stock market, is being driven by rising coronavirus infections in Europe and the United States — and fears about how governments may respond. Severe lockdowns this spring crushed demand for oil – sending US crude below zero for the first time ever.
Switzerland and France are expected to announce new steps to fight the pandemic. And officials in Germany are discussing new efforts, too.
In the United States, Illinois announced new restrictions for Chicago, including no indoor bar or dining service and 11 pm closings of casinos and outdoor dining.
“It’s calling oil demand into question. The recovery so far has been relatively fragile,” said Ryan Fitzmaurice, energy strategist at Rabobank.
The worsening pandemic could derail the rebound in air travel.
“A lot of people will opt out for health reasons. And people will pass up or pare back Thanksgiving travel,” Fitzmaurice.
US stocks tumbled again at Wednesday’s opening bell.
The drivers for the selloff are the same as on Monday: rising Covid-19 infection in Europe are sparking worries about renewed lockdowns to stave off the pandemic’s second wave, and uncertainty about next week’s election and further government stimulus is keeping investors worried about the economy.
On Monday, the Dow logged its worst day in more than seven weeks, while the S&P had its worst performance since late September.
Here’s some shocking Federal Reserve news.
Bill Dudley, former President of the New York Fed, said the central bank’s toolbox to support the economy is almost empty.
Investors and economists have rested assured that the Fed would do whatever necessary to keep markets functioning and the recovery going throughout this crisis. So if that has changed, it’s a really big deal.
The Fed cut interest rates to near zero in March and intends to leave them there for years – and it has rolled out numerous stimulus facilities.
Sure, there are more complex things the Fed can do, such as turning interest rates negative. “But,” Dudley said, “this misses a crucial point. Even if the Fed did more — much more — it would not provide much additional support to the economy. Interest rates are already about as low as they can go, and financial conditions are extremely accommodative.”
So then what?
Well, the Fed should still commit to doing all that it can, Dudley said, but it should be very clear that monetary policy can only accomplish so much.
“It’s up to legislators and the White House to give the economy what it needs —and right now, that means considerably greater fiscal stimulus,” he said.
We had an inkling that Monday’s stock market selloff wasn’t going to be the last before the election. There’s just too much uncertainty in the air.
Today’s stocks drop is a fully-fledged “risk off” move, meaning that riskier investments are getting culled in favor of safer ones.
The most traditional of safe havens – US Treasury bonds – are showing just that. The yield on the 10-year note slipped to 0.76%. Bond yields and prices move opposite to each other, so when prices rise because demand is strong, yields drop.
Similarly, the US dollar – measured by the ICE US Dollar Index – is up 0.6%. That might seem counterintuitive, after all, the election and stimulus uncertainty that’s weighing on stocks is about America. But the dollar is still the world’s currency and in doubt the safest place to be.
However, gold, another traditional safety play, isn’t fitting the bill today. Gold prices are down more than 1%, pushed lower by the advancing dollar.
Fiat Chrysler returned to profitability in the third quarter and posted record results.
The automaker recorded net income of €1.5 billion, or $1.8 billion, excluding special items. That follows losses in both the first and second quarters, as the Covid-19 pandemic shutdown auto plants and cut deeply into car sales across the globe.
Sales rebounded strongly in the third quarter, though not quite to the levels reported a year ago. Revenue was off 6% in the quarter compared to a year earlier, as the company sold 1.03 million cars and trucks, off 3%.
The company reinstated guidance to say it expects to have adjusted earnings before interest and taxes of between $3.5 billion and $4.1 billion, though it will have an industrial cash burn as much as $1.1 billion for the year. Its best case scenario on cash burn would be to break even.
The results are a sign of a rebound in the auto industry overall. Shares of Fiat Chrysler, along with rivals General Motors and Ford, are all up more than 30% since the beginning of June. Ford is also due to report a return to profitability after the bell on Wednesday, and GM is due to report the same next week. But shares of Fiat Chrysler were slightly lower in European trading and premarket trading in the US following the report.
