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Markets Fight Back to Flat; Netflix Mixed in Q1, United Beats
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Markets spent the second session in a row staying close to home for most of the trading day, fighting off the morning drop in all but the small-cap Russell 2000, which spent most of the day in the red. By the close, all major indices were within a half-point of unchanged on either side of the ledger. The Dow was -0.031% while the S&P 500 gained +0.086% for the day. The Nasdaq finished -0.035% on the session, while the Russell ended the day -0.40%.
What we saw after the opening bell was St Louis Fed President James Bullard — perhaps the most outspoken hawk at the Federal Reserve, though not currently a voting member — cooling any rhetoric entertaining a forecasted recession in the U.S. However, what he did say — and which comes at not much of a surprise to those who follow Bullard’s comments — is that he continues to favor more rate hikes. Hike”s,” plural. This may have fomented a bit of down ward momentum in the market a half hour or so into the trading day.
The fact of the matter is, we’ve already been through most economic reports before the next Federal Open Market Committee (FOMC) meeting, which begins two weeks from today, with a new monetary policy decision the following day. If Bullard represents the consensus of the FOMC, we may expect another 25 basis-point (bps) hike, as already rolled out in the Fed’s dot-plot, but that which softer econ data some believed may have been able to change the Fed’s collective mind. Ultimately, another 25 bps raise likely won’t flop us into recession all by itself, though it does increase the chances something “breaks.”
Netflix (NFLX - Free Report) reported Q1 earnings results after the closing bell today, posting narrowly mixed results: earnings of $2.88 per share outpaced the Zacks consensus by 2 cents per share, while quarterly sales of $8.16 billion were just shy of the $8.18 billion expected. Immediately after the results were posted, shares fell -10%. They’ve come back a bit since then, but clearly the response was not overwhelmingly welcomed by late traders.
The clearest signal that Q1 was not a terrific quarter for Netflix was in Q2 guidance: earnings of $2.84 per share and $8.24 billion in revenues were both diminished from the $2.91 per share and $8.44 billion in sales previously expected. And while subscriber net adds outperformed expectations, its Average Revenue per User (ARPU) declined more than analysts had been anticipating. Also, somewhat newer metrics, like Netflix’s ad-supported business and its crackdown on password-sharing will likely show up clearer in its Q3 report than Q2, which is typically its weakest quarter of the year.
United Airlines (UAL - Free Report) posted beats this afternoon on its Q1 report this afternoon, with a slimmer-than-expected loss per share of -63 cents come in a full dime better than the Zacks consensus and the abysmal -$4.24 per share reported in the year-ago quarter. Most metrics under the hood of the company were in-line with expectations, such as Revenue and Cost per Seat Mile. But the major airline holds expects full-year earnings per share to be between $10-12, whereas consensus ahead of the report was for $8.66 per share. United stock is up +1.4% in after-hours trading. Questions or comments about this article and/or its author? Click here>>
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Markets Fight Back to Flat; Netflix Mixed in Q1, United Beats
Markets spent the second session in a row staying close to home for most of the trading day, fighting off the morning drop in all but the small-cap Russell 2000, which spent most of the day in the red. By the close, all major indices were within a half-point of unchanged on either side of the ledger. The Dow was -0.031% while the S&P 500 gained +0.086% for the day. The Nasdaq finished -0.035% on the session, while the Russell ended the day -0.40%.
What we saw after the opening bell was St Louis Fed President James Bullard — perhaps the most outspoken hawk at the Federal Reserve, though not currently a voting member — cooling any rhetoric entertaining a forecasted recession in the U.S. However, what he did say — and which comes at not much of a surprise to those who follow Bullard’s comments — is that he continues to favor more rate hikes. Hike”s,” plural. This may have fomented a bit of down ward momentum in the market a half hour or so into the trading day.
The fact of the matter is, we’ve already been through most economic reports before the next Federal Open Market Committee (FOMC) meeting, which begins two weeks from today, with a new monetary policy decision the following day. If Bullard represents the consensus of the FOMC, we may expect another 25 basis-point (bps) hike, as already rolled out in the Fed’s dot-plot, but that which softer econ data some believed may have been able to change the Fed’s collective mind. Ultimately, another 25 bps raise likely won’t flop us into recession all by itself, though it does increase the chances something “breaks.”
Netflix (NFLX - Free Report) reported Q1 earnings results after the closing bell today, posting narrowly mixed results: earnings of $2.88 per share outpaced the Zacks consensus by 2 cents per share, while quarterly sales of $8.16 billion were just shy of the $8.18 billion expected. Immediately after the results were posted, shares fell -10%. They’ve come back a bit since then, but clearly the response was not overwhelmingly welcomed by late traders.
The clearest signal that Q1 was not a terrific quarter for Netflix was in Q2 guidance: earnings of $2.84 per share and $8.24 billion in revenues were both diminished from the $2.91 per share and $8.44 billion in sales previously expected. And while subscriber net adds outperformed expectations, its Average Revenue per User (ARPU) declined more than analysts had been anticipating. Also, somewhat newer metrics, like Netflix’s ad-supported business and its crackdown on password-sharing will likely show up clearer in its Q3 report than Q2, which is typically its weakest quarter of the year.
United Airlines (UAL - Free Report) posted beats this afternoon on its Q1 report this afternoon, with a slimmer-than-expected loss per share of -63 cents come in a full dime better than the Zacks consensus and the abysmal -$4.24 per share reported in the year-ago quarter. Most metrics under the hood of the company were in-line with expectations, such as Revenue and Cost per Seat Mile. But the major airline holds expects full-year earnings per share to be between $10-12, whereas consensus ahead of the report was for $8.66 per share. United stock is up +1.4% in after-hours trading.
Questions or comments about this article and/or its author? Click here>>