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Nasdaq Falls 3% on Fast-Growing 10-Year Yields; FDX Beats, NKE Mixed
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A downturn in the final hour of trading this afternoon sent all indexes into the red by the close, led downward by a 3% drop in the Nasdaq — down 409 points — and taking out the previous gains established earlier in the week. The Dow, which had been up more than 200 points mid-day, closed down 153 points or 0.46%, while the S&P 500 was -1.5%. The Russell 2000, which had been hot on the heels of the one-year gains of the other indexes, was also down around 3% today.
The 10-year Treasury bill crossed above 1.75% intraday before settling at 1.73%, spooking traders who have been keeping one eye on inflation creep for the past few weeks now. While we’re still notably below the Fed’s preferred 2%, we’re coming up fast: t-bill yields have gone up more than 50 basis points in just the last six weeks alone. What happens if this trajectory is maintained upon reaching 2%?
Nike (NKE - Free Report) posted a mixed fiscal Q3 earnings report after the closing bell today, easily topping estimates on the bottom line — 90 cents per share versus 75 cents expected — while missing on the top. The athletic shoe and apparel leader, which had carried a Zacks Rank #2 (Buy) into the earnings release, posted $10.36 billion in quarterly sales, below the $10.95 billion anticipated by our analysts.
While revenue growth in China was up an impressive 51%, Europe was -4%, mostly on quarantine issues as the coronavirus has enjoyed something of a comeback in the region. But the kicker was the -10$ downfall in North American sales, which the company blames on supply chain issues — specifically, the company’s inability of bringing products into the U.S., by far its biggest market. Sales in North America were expected around $4 billion; $3.56 billion is what Nike brought in.
FedEx (FDX - Free Report) demonstrated its continued strength over the past three months by delivering a vibrant fiscal Q3 this afternoon, putting up $3.47 per share versus the $3.21 expected, and more than $2 higher than the year-ago quarter’s bottom line. Revenues of $21.51 billion surpassed the $19.97 billion in the Zacks consensus. The continued online shopping trend has put FedEx — as well as its competitors UPS (UPS - Free Report) and Amazon (AMZN - Free Report) — in the veritable driver’s seat.
This marks FedEx’s fourth straight earnings beat, following a couple years of difficulties reaching estimates on its bottom line. Shares are up 3% in late trading on the earnings news, and are now north of 10% year to date. Though now trading off its early-December all-time highs, FedEx stock has still grown 135% from its March 2020 lows.
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Nasdaq Falls 3% on Fast-Growing 10-Year Yields; FDX Beats, NKE Mixed
A downturn in the final hour of trading this afternoon sent all indexes into the red by the close, led downward by a 3% drop in the Nasdaq — down 409 points — and taking out the previous gains established earlier in the week. The Dow, which had been up more than 200 points mid-day, closed down 153 points or 0.46%, while the S&P 500 was -1.5%. The Russell 2000, which had been hot on the heels of the one-year gains of the other indexes, was also down around 3% today.
The 10-year Treasury bill crossed above 1.75% intraday before settling at 1.73%, spooking traders who have been keeping one eye on inflation creep for the past few weeks now. While we’re still notably below the Fed’s preferred 2%, we’re coming up fast: t-bill yields have gone up more than 50 basis points in just the last six weeks alone. What happens if this trajectory is maintained upon reaching 2%?
Nike (NKE - Free Report) posted a mixed fiscal Q3 earnings report after the closing bell today, easily topping estimates on the bottom line — 90 cents per share versus 75 cents expected — while missing on the top. The athletic shoe and apparel leader, which had carried a Zacks Rank #2 (Buy) into the earnings release, posted $10.36 billion in quarterly sales, below the $10.95 billion anticipated by our analysts.
While revenue growth in China was up an impressive 51%, Europe was -4%, mostly on quarantine issues as the coronavirus has enjoyed something of a comeback in the region. But the kicker was the -10$ downfall in North American sales, which the company blames on supply chain issues — specifically, the company’s inability of bringing products into the U.S., by far its biggest market. Sales in North America were expected around $4 billion; $3.56 billion is what Nike brought in.
FedEx (FDX - Free Report) demonstrated its continued strength over the past three months by delivering a vibrant fiscal Q3 this afternoon, putting up $3.47 per share versus the $3.21 expected, and more than $2 higher than the year-ago quarter’s bottom line. Revenues of $21.51 billion surpassed the $19.97 billion in the Zacks consensus. The continued online shopping trend has put FedEx — as well as its competitors UPS (UPS - Free Report) and Amazon (AMZN - Free Report) — in the veritable driver’s seat.
This marks FedEx’s fourth straight earnings beat, following a couple years of difficulties reaching estimates on its bottom line. Shares are up 3% in late trading on the earnings news, and are now north of 10% year to date. Though now trading off its early-December all-time highs, FedEx stock has still grown 135% from its March 2020 lows.
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The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>