Before the bell: earnings season drives volatility

Most stock prices are rising, though a profit warning here and there leads to a significant punishment.

On Wall Street, the average gain yesterday was a quarter of a percent. Goldman Sachs (+2.1%) and American Express (+1.5%) did even better. Boeing (-2.8%) saw its share price drop to $150.69. The aircraft manufacturer sold a large new share offering at $143, raising $21 billion in new capital. This money is welcome, as Boeing is expected to burn through $14 billion in cash this year. Tesla (-2.5%) saw some profit-taking after last week’s sharp 26% rise. That steep climb resulted in a $4.2 billion loss for short-sellers in the stock. Waste Management (+0.7%) reported excellent earnings after hours, raising its full-year profit forecast and predicting a strong 2025. In Europe, stock markets rose by an average of half a percent yesterday. Vinci (+2.8%), Adyen (+2.5%), Azelis (+2.5%), and Kering (+2.4%) were among the top performers.

This morning, Asia is also showing gains. Japan’s Topix is up 0.9%, and the Hang Seng in Hong Kong has risen by 0.4%. Later today, we’ll find out how much the Belgian economy grew in the past quarter. We’ll also get quarterly results from Adidas, Alphabet, AMD, BP, Chubb, HelloFresh, McDonald’s, Mondelez, Novartis, Snap, and Visa.

Engine trouble

Ford released its earnings last night. Like competitor General Motors, Ford had a strong quarter. Revenue of $46.2 billion is slightly lower than the $47.8 billion recorded in the second quarter but still 5% higher than the $43.8 billion in the third quarter of last year. The operating profit of $2.6 billion met expectations but provided little reason to celebrate. Worse yet, despite a good quarter, Ford lowered its annual forecast for operating profit from $10–12 billion to “around $10 billion.” Shareholders were unimpressed, sending the stock down by 6% after hours.

New buyback program

HSBC announced better-than-expected earnings this morning. Europe’s largest bank saw its gross profit rise by $800 million to $8.5 billion, 10% higher than the same period last year. The loan margin fell from 170 basis points to 146 basis points, but this decline was more than offset by higher profits in private banking, wealth management, and trading operations. On Friday, HSBC completed its $3 billion share buyback program and announced this morning that it plans to buy back another $3 billion in shares over the next four months. The group has a market value of $164 billion, which will likely increase further today.

Did you know…

that HSBC stands for “Hongkong and Shanghai Banking Corporation”? The bank was founded in 1865 in Hong Kong by Thomas Sutherland, a young Scotsman working for a shipping company. Originally, the bank primarily financed international trade.

This article was translated from Dutch and was originally published on Spaarvarkens.be.