Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average rose sharply on Tuesday after slipping in four out of the past five sessions.
- Goldman Sachs Group Inc.'s (GS - Get Report) third-quarter earnings of $6.28 a share handily beat analysts' estimates.
- Walmart Inc. (WMT - Get Report) , the world's largest retailer, lowered earnings guidance for 2019 following its $16 billion acquisition of a majority stake in India's Flipkart earlier this year.
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Wall Street Overview
Stocks posted sharp gains on Tuesday, Oct. 16, getting a boost from better-than-expected earnings from investment banks Morgan Stanley (MS - Get Report) and Goldman Sachs Group Inc. (GS - Get Report) .
The Dow Jones Industrial Average rose 547 points, or 2.2%, to 25,798.42, the S&P 500 gained about 2.2%, and the Nasdaq jumped 2.9%. Alphabet Inc. (GOOGL - Get Report) rose 2.8% and Amazon.com Inc. (AMZN - Get Report) was up 3.4%.
Dow component Walmart Inc. (WMT - Get Report) lowered its earnings guidance for 2019 and said comparable U.S. store sales would grow at a slower-than-expected rate as it continued to count the cost of its $16 billion acquisition of a majority stake in India's Flipkart earlier this year. Walmart shares, however, rose 2.1%.
Walmart, the world's largest retailer, said its sees GAAP earnings per share for fiscal 2019 in the range of $2.65 to $2.80, down from a previous forecast of $2.90 to $3.05, a figure that reflects a dilution of 25 cents a share from the Flipkart deal. Comparable U.S. sales, the company said, will rise between 2.5% and 3% next year, down from a previous forecast of around 3%. Online sales, which are crucial for the group's ambitions to challenge Amazon in international markets, will likely grow by 35% over its 2020 fiscal year, the company said.
Denting sentiment somewhat were developments in Saudi Arabia linked to the disappearance of prominent journalist Jamal Khashoggi. U.S. Secretary of State Mike Pompeo arrived in Riyadh, Saudi Arabia, earlier Tuesday and will meet King Salman to discuss the Khashoggi case amid speculation that the kingdom is preparing a report that will admit the journalist's death but pin the responsibility on interrogators working at the Saudi consulate in Istanbul, where Khashoggi was last seen on Sept. 28. The Khashoggi case has cast a dark shadow over sentiment given the potential fallout between the U.S. and a critical security ally in the Gulf region.
Morgan Stanley (MS - Get Report) reported third-quarter profit of $1.17 a share, handily beating analysts' expectations of $1.01. Earnings in the quarter rose 19% from a year earlier to $2.11 billion as revenue from trading stocks and bonds increased while tax cuts from the Trump administration fattened the bottom line. The stock jumped 5.8%.
Goldman Sachs (GS - Get Report) earned $6.28 a share in the third quarter, beating Wall Street forecasts of $5.38. Third-quarter revenue of $8.65 billion came in above forecasts of $8.35 billion. Net income rose 19% to $2.52 billion. Shares rose 3%.
UnitedHealth Group Inc. (UNH - Get Report) posted third-quarter earnings of $3.41 a share vs. estimates of $3.29. Revenue was $56.6 billion, slightly higher than forecasts of $56.34 billion. The health insurer also raised its full-year earnings outlook. The stock gained 4.6% on Tuesday.
Johnson & Johnson (JNJ - Get Report) reported third-quarter adjusted earnings of $2.05 a share, 2 cents above analysts' estimates. Quarterly revenue of $20.3 billion topped forecasts that called for sales of $20.1 billion. The company also boosted its full-year profit guidance, thanks in part to a stronger-than-expected performance for key cancer treatments that offset fading sales for Remicade, its blockbuster arthritis drug. J&J rose 2%.
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