Apr 25, 2019, by Samuel Potter
Everything is fine
Well done to Facebook Inc., whose first-quarter revenue rose a better-than-projected 26 percent on the strength of its advertising business. (Five Things loves it when the good guys win. Speaking of which, the company also said it’s setting aside a few billion dollars or so related to some annoying privacy investigation or other.) Congratulations to Microsoft Corp., which also beat estimates thanks to new cloud-computing deals. These kind of tech vibes are helping Nasdaq futures buck a more gloomy market mood overall (see below.) Also felicitations to UBS Group AG, which can thank possibly not crazy but certainly rich Asians for a bunch of new money that helped it to a beat. Even Wirecard AG – poor, beleaguered Wirecard – reaffirmed its profit forecast. It’s great to see that all is well with the world.
Everything is not fine
Oh wait. Maybe not. Tesla Inc. reported another loss and the lowest cash level in three years, opening the door to more finance raising. Nokia OYJ shares slumped after the company posted a surprise loss. Profits at Nomura Holdings Inc. plunged. Two big European M&A deals (Deutsche Bank+Commerzbank and Sainsbury’s+Asda) are floundering. The Bank of Japan flagged “high uncertainties” in the outlook for economic expansion and prices as it tweaked guidance. South Korean gross domestic product, a barometer of global strength thanks to the nation’s export-heavy economy, shrank the most in a decade in the first quarter. All this on the heels of more bad European data on Wednesday.
Oil is still kinda fine though
Oil extended gains on Thursday, with Brent crude climbing for a fifth day to above $75 per barrel as the U.S. decision to make buying Iranian crude harder continued to reverberate, and after Saudi Arabia’s energy minister said on Wednesday that his nation saw no immediate need for action in the market. The rally has continued despite American government data that showed a much larger-than-expected rise in stockpiles. As usual, the implications elsewhere in the financial markets are mixed.
Overnight, the MSCI Asia Pacific Index declined 0.4 percent even as Japan’s Topix index closed 0.5 percent higher. Blame a late slump in China for much of that regional retreat – the benchmark gauge in Shanghai dropped 2.4 percent. In Europe, the Stoxx 600 Index edged lower at 6:25 a.m. Eastern Time. S&P 500 futures were flat, the 10-year Treasury yield was at 2.525 percent and gold was higher.
Good news! Investors get plenty more clues as to whether things are fine or not fine today, with jobless claims and durable goods data for the U.S. both due at 8:30 a.m. Bloomberg’s consumer comfort number, which will help tell you how comfortable consumers are, is coming at 9:45 a.m. And there’s another earnings deluge, with Comcast Corp. and United Parcel Service Inc. among names telling you their earnings before the bell. Amazon.com Inc. and Ford Motor Co. are going to reveal theirs after the close (when all you want to do is go home and catch up on Game of Thrones, which is more interesting because it has dragons in it.)