Spreadex Market Update
Wave of negative US data leaves Western markets in the doldrums with Apple earnings still to come
Normally such dismal data would have been a big boost to the Dow, due to their rate-hike delaying capabilities. However, since it was already beyond unlikely that the Fed would choose to pull the lift-off trigger this month anyway, today’s economic bad news carried more weight as, well, bad news than it traditionally has done for much of the year. Not that this was too disastrous for the Dow (which, admittedly, was helped by decent third quarter results for Pfizer and Merck), only dropping by around 10 points on the day.
Of course Tuesday’s (and arguably the week’s) main event is still to come: Apple’s fiscal fourth quarter results. With Alibaba this afternoon escaping the spectre of the Chinese slowdown to post a 32% increase in revenue (and a 4% jump for its stock post-release) Apple will be hoping for some similarly kind numbers after the markets close. Analysts are expecting earnings per share of $1.88, $51.02 billion in revenue and, importantly, around 48.5 million iPhone units, that last figure being the one to watch. More specifically investors will be on the lookout for those figures coming from China; the region was the main driver of growth back in Q3, seeing an 87% increase in iPhones sales and more than doubled revenue. Any blowback, therefore, from August’s ‘issues’ could spell trouble for Apple.
And what of rest of the markets? Well without much cheer from the US the European indices remained in the red this afternoon; the DAX was the biggest loser, falling over 80 points, whilst the FSTE continued to be hampered by a weak-GDP, weak-commodity stock combo.
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