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Monday, October 23, 2017

Pre-market futures are up again ahead of today’s opening bell, where Q3 earnings season shifts to high gear with some of the biggest companies in the world reporting on their businesses this week. Congress continues to work on the blueprint for a tax cut/reform package which has thus far looked positive for its proponents. And Japanese Prime Minister Shinzo Abe has won an overwhelming election victory, which may see him become the longest-serving PM in that country’s history.

As Zacks Exec VP Kevin Matras points out in his Profit from the Pros piece this morning, U.S. stock indexes are up for now 6 straight weeks. He cites not only the tax cut proposal in fostering positive market sentiment, but also economic reads from late last week such as Existing Home Sales which further support the strengthening domestic economy. To read the entire article, click here.

For even more positive sentiment regarding Q3 earnings season, Zacks Director of Research Sheraz Mian points out that “the revisions trend for the December quarter is shaping up to be unusually favorable” with growth estimates for Q4 revising upward by more than 9%. He does expect these numbers to dwindle a bit over time, but this is a forecast that would likely provide a major positive impact for full-year 2017, and likely continuing into 2018. For the entire Earnings Preview article, please click here.

Japan’s Rising Son

Shinzo Abe has overseen drastic economic improvements following more radical economic policies early in his tenure as Japan’s Prime Minister. And, with the NKY now up for 14 straight days (admittedly not as impressive as 6 weeks of gains here in the U.S.), the Japanese citizenry has marked its vast approval of Abe’s administration. The Prime Minister has also indicated he wishes to make amendments to the Japanese constitution for the first time since its implementation 70 years ago. Presumably, these would also pertain to measures that would help grow the Japanese economy and help keep it competitive in the global marketplace.

Japan has enjoyed economic growth now for a year and a half, following literally decades of stagnation. And with Abe’s ambitious policies continuing to point the way forward, he would look to become the longest-serving Japanese Prime Minister to serve in that country’s history, as of November 2019.

Q3 Earnings Results

Oilfield services giant Halliburton (HAL - Free Report) posted beats on both top and bottom lines of its Q3 earnings report before today’s market open. Earnings of 42 cents per share outperformed the Zacks consensus by 4 cents per share. Revenues of $5.44 billion also outpaced the consensus estimate of $5.32 billion. Over the previous 4 quarters, Halliburton beat earnings estimates each time, at an impressive 67% average. HAL shares are up only modestly ahead of the bell; shares are down nearly 20% year-to-date.

T-Mobile U.S. (TMUS - Free Report) also topped earnings estimates — 63 cents per share versus 44 cents expected — on quarterly revenues that were a smidge beneath the $10.02 billion expected. Post-paid churn metrics fell in the quarter, whereas post-paid connections rose 11% year over year. T-Mobile U.S. is trading up 1% in the early market, and the stock is +5% year to date.

Mark Vickery
Senior Editor

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