The pharmaceutical company began moving into respiratory syncytial virus vaccines and obesity drugs last year after a slowdown in growth
coronavirus2 hours ago
A quartet of technology heavyweights will be part of an avalanche of quarterly corporate earnings reports this week that, along with a meeting of Federal Reserve policymakers, could hold the key to whether Wall Street extends its record-breaking rally or loses steam.
With second-quarter reporting season kicking into high gear, scorecards from Apple, Alphabet, Amazon.com and Facebook will be front and centre for investors eyeing the S&P 500's already-stretched valuation following a nearly nine per cent rally since June 27.
"These are very widely-owned companies by institutional investors and there could be selling if the news is bad," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.
A total of 194 S&P 500 companies are expected report their quarterly earnings this week; that is much higher than normal for any one week, even during most reporting seasons.
Of reports in so far, 54 per cent have shown revenue above expectations, slightly better than the 48 per cent beat rate over the past year.
Expectations for earnings also appear to be on the mend after over a year of declines caused by slumping oil prices and a strong dollar. Second-quarter profits are now forecast to dip three per cent, less than the 4.5 per cent drop expected at the start of July, according to Thomson Reuters I/B/E/S.
With the S&P 500 trading at about 17 times expected earnings, valuations appear stretched, with some investors saying current stock prices presume better-than-expected results and forecasts from major companies. Apple, Alphabet, Amazon and Facebook account for around seven per cent of the S&P 500 and a fifth of the Nasdaq Composite, which has lagged the broader stock market so far this year.
The S&P 500 is up six per cent in 2016 while the Nasdaq has gained just two per cent.
Many on Wall Street expect those leading technology firms to at least meet or slightly exceed analysts' forecasts, strategists said. A series of big surprises in either direction could lead to steep stock swings.
Indeed, shares of Amazon have whipsawed following its most recent reports, slumping six per cent in one day after its December quarter profits missed expectations and surging 10 per cent the day after its March-quarter results blew away forecasts.
Wall Street widely expects sales of Apple's iPhones to fall this year for the first time ever as it competes with cheaper rivals in China. But investors are banking on the release of a new smartphone later this year to return Apple to revenue growth in 2017.
"I'm looking at the numbers coming in [this] week, and Facebook, Google and Amazon should all be strong. Apple is the only one I'm concerned out because of the some of the issues they've had with lost market share," said Daniel Morgan, senior portfolio manager at Synovus Trust Company in Atlanta. His firm owns shares of Apple, Amazon and Alphabet.
On Tuesday and Wednesday the Federal Reserve holds its next policy meeting, with futures prices implying most investors expect no interest rate hike until March 2017. Following the market's quick rebound from Britain's unexpected June vote to leave the European Union, a minority of investors predict an increase as soon as September.
"They're going to start setting people up for September. The economy is clearly getting better and we're seeing less concern about international events," said Stephen Massocca, Chief Investment Officer of Wedbush Equity Management in San Francisco.
Apple hands in its results on Tuesday, while Facebook reports on Wednesday and Amazon and Alphabet both report on Thursday.
The pharmaceutical company began moving into respiratory syncytial virus vaccines and obesity drugs last year after a slowdown in growth
coronavirus2 hours ago
Sources said some senior crew members switched off their mobile phones just before flight operations, citing health issues
world2 hours ago
The group’s hospitals continued to be a core driver of its performance, with net profit from these businesses jumping more than 31 per cent to Dh137 million
business3 hours ago
Directives issued to step up pre-monsoon cleaning drives, surveillance activities
asia3 hours ago
Temperature expected to touch a maximum of 43ºC in internal areas
uae4 hours ago
Some studies suggest that certain types of music, like classical or ambient, might be beneficial for cognitive tasks requiring concentration and attention
uae5 hours ago
The 32-year-old, who came out of retirement last month, is grateful to have another crack at the World Cup
cricket11 hours ago
'My kids' hero is Ronaldo' now I hope it's me' said the 2024 World Snooker Champion after his opponent Jones lost the first seven frames of the best of 35 frames contest
sports12 hours ago