Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average was rising Wednesday, getting a lift from earnings from two of the country's biggest banks.
- Bank of America Corp. (BAC) reported fourth-quarter profit of 70 cents a share, topping analysts' estimates by 7 cents. The stock rose 7.2%.
- Goldman Sachs Group Inc. (GS) earned $6.04 a share in the fourth quarter, smashing analysts' estimates of $4.30, and the stock rose 9.6%.
Wall Street Overview
Stocks rose Wednesday, Jan. 16, after stronger-than-expected earnings from two of the country's biggest banks offset concerns over the crushing Brexit defeat for U.K. Prime Minister Theresa May and worries that progress in U.S.-China trade talks may have stalled following reported comments from Washington's top negotiator.
Goldman Sachs Group Inc. (GS) earned $6.04 a share in the fourth quarter, well ahead of the consensus forecast of $4.30. Revenue also was surprisingly solid at $8.08 billion. The stock jumped 9.6%.
That followed a similarly strong report from Bank of America Corp. (BAC) , which beat Wall Street estimates on both the top and bottom line with fourth-quarter earnings of 70 cents a share and a 2% increase in total deposits to $1.34 trillion. Shares rose 7.2%.
The Dow Jones Industrial Average rose 142 points, or 0.6%, to 24,207, the S&P 500 was up 0.22%, and the Nasdaq gained 0.15%.
May suffered the worst defeat in U.K. parliamentary history on Tuesday when her proposed withdrawal agreement, which would have seen Britain exit the European Union in March, was defeated by 230 votes, including 100 members of her own party. The humiliating verdict triggered an immediate vote of no confidence in her government, which will debated later Wednesday.
Stocks in Asia were unsettled by comments reportedly from U.S. Trade Representative Robert Lighthizer, as told to reporters by Republican Sen. Chuck Grassley, that U.S.-China trade talks weren't progressing as well as investors may have anticipated.
"(Lighthizer) said that there hasn't been any progress made on structural changes that need to be made," Grassley told the media during a conference call. "Let's say that would include intellectual property, stealing trade secrets, putting pressure on corporations to share information with the Chinese government and industries."
Fiserv will pay $22.74 for each First Data share, a near 30% premium to the stock's closing price of $17.54 on Tuesday. First Data shareholders will get 0.303 of a Fiserv share under terms of the takeover, and will own 42.5% of the combined company once the deal closes in the second half of this year.
First Data shares surged 21.3% to $21.15, while Fiserv shares fell 3.3% to $72.57.
Adjusted earnings in the quarter were $2.41 a share, higher than $1.44 a share a year earlier and above analysts' predictions of $1.99. Revenue rose to $10.5 billion from $9.45 billion a year earlier, and topped forecasts of $10.3 billion.
Ford Motor Co. (F) said fourth-quarter earnings likely will fall short of Wall Street forecasts, sending shares lower by 6.3%.
Ford said earnings for the three months ended in December would come in at around 30 cents a share, 2 cents shy of analysts' forecasts, but hinted that current year profit could improve even as global markets remain under pressure from new emissions standards, trade tensions and slowing economic growth.
"For 2019, we see the potential for year-over-year improvement in company revenue, EBIT and adjusted operating cash flow," said Chief Financial Officer Bob Shanks. "We expect to be able to fully fund our business needs, while maintaining cash and liquidity levels at or above our target levels."
Snap Inc. (SNAP) tumbled 13.8% Wednesday following the sudden resignation of Chief Financial Officer Tim Stone after just eight months with the company.
Stone is the third top executive to leave the social media company in the past four months. His departure was "not related to any disagreement with us on any matter relating to our accounting, strategy, management, operations, policies, regulatory matters, or practices," the company said.
Stone came to Snap from Amazon.com Inc. in May 2018. He will remain with Snap through the publication of the company's fourth-quarter and full-year earnings on Feb. 5. Snap said those figures are likely to come in at the higher end of the company's previous guidance.
Nordstrom Inc. (JWN) declined 4.7% after the U.S. department store chain posted weaker-than-expected holiday sales, echoing similar struggles from rival retailers.
Nordstrom said comparable-store sales for the three months ended on Jan. 5, rose 0.3% from the same period last year, thanks in part to slower customer traffic. The company added that sales at its discount stores jumped 3.9%, thanks to an 18% surge in online transactions.
Year-to-date sales at its full-price stores were below prior forecast, the company said, even as it raised the lower end of its full-year adjusted earnings guidance by 5 cents to $3.55 to $3.65 a share.
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