Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Overnight Markets: Wall Street falls on caution ahead of earnings

Overnight Markets: Wall Street falls on caution ahead of earnings

US stocks declined on Monday, with the Standard & Poor’s 500 Index registering its biggest loss in two months, as mounting negative pre-announcements left a lacklustre profit growth outlook.

The Dow Jones industrial average fell 179 points or 1.09%, to 16,258, the S&P 500 lost 23 points or 1.26%, to 1,819 and the Nasdaq Composite dropped 61 points or 1.47%, to 4,113.

Nearly 10 out of every 11 earnings pre-announcements for the current earnings season from S&P 500 companies have lowered estimates, according to Thomson Reuters data.

Various companies that posted weak earnings or forecasts on Monday, including SodaStream (SODA.O), Lululemon Athletica (LULU.O), Express Inc (EXPR.N) and Aaron's (AAN.N) saw their stocks get hit hard.

Lululemon sank 16.6%, while Express slid 4.6%. Aaron's lost 6.8% and SodaStream plunged 26%.

But Wendy's (WEN.O) outlook was a bright spot, sending shares up 6.4% after the fast-food restaurant chain estimated adjusted quarterly earnings above analysts' expectations.

In deal news, Beam Inc (BEAM.N) agreed to be acquired by Suntory Holdings Ltd for $16 billion, including debt. Shares of Beam jumped 24.6%.

After the closing bell, Google (GOOG.O) agreed to acquire Nest Labs Inc for $3.2 billion in cash. Google shares edged 0.6% higher in after-market trade.

Intercept Pharmaceuticals Inc. plunged 18% after the stock soared six fold last week.

Microsoft decreased 2.9%, while Disney tumbled 2.8% for the largest declines in the Dow industrial average. Nike fell 2.3% and Exxon Mobil Corp. slid 2%.

In Asia, shares declined on Tuesday in morning trade following the biggest drop in US stocks since November amid concern over valuations.

The MSCI Asia Pacific Index lost 1.2% to 139 as of 10:55 a.m. in Tokyo. Japan’s Topix (TPX) index slumped 1.9% as the market reopened following a public holiday. Australia’s S&P/ASX 200 Index fell 1%, while New Zealand’s NZX 50 Index slid 0.7%.

South Korea’s Kospi index lost 0.1%. Singapore’s Straits Times Index dropped 0.4% and Taiwan’s Taiex index declined 0.3%.

Hong Kong’s Hang Seng Index lost 0.8% and the Hang Seng China Enterprises Index of mainland shares traded in the city fell 1%. China’s Shanghai Composite Index slipped 0.3%.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
CIO Tapes 2: two warnings and a lot of optimism

CIO Tapes 2: two warnings and a lot of optimism

Our group of leading asset management CIOs see a lot of opportunities – and overseas investors are buying UK too

Play Wealth Manager Retreat 2017: size isn't everything

Wealth Manager Retreat 2017: size isn't everything

We asked our delegates at the Wealth Manager Retreat what they think about the recent wave of consolidation in the industry.

1 Comment Play CIO Tapes - part 3: 'passive funds are anti-capitalist'

CIO Tapes - part 3: 'passive funds are anti-capitalist'

Citywire recently gathered three of the UK's leading fund investment heads to discuss their hopes, fears and the issues that their jobs throw at them daily.

Read More
Your Business: Cover Star Club

Profile: Thomas Miller explains its post-restructure plans

Profile: Thomas Miller explains its post-restructure plans

Thomas Miller Investment’s (TMI) head of wealth Matt Phillips has strong opinions about many things

Wealth Manager on Twitter