Corporate earnings and US tax plans in focus | Calamatta Cuschieri

On Wednesday European indexes finished in the green area, as markets analysed a raft of corporate earnings reports, most of which beat analysts’ expectations. The FTSE 100 closed 0.18% in the green in London, as Standard Chartered topped the list of best performers with a gain of 4.08%. The German DAX edged up just 0.05% above the flat line on closing bell. Deutsche Bank jumped around 2%, while Lufthansa bagged another 1%. In France, the CAC 40 gained 0.19% when the session ended. Kering, a luxury goods company, rallied as its first-quarter sales growth surged above estimates. 

On Wall Street, US opened slightly higher but then turned mixed on the major exchanges. The earning season is giving the bulls and bears something to chew on, with PayPal and Amgen; the biopharmaceutical, releasing their quarterly statements aftermarket closure. In the meantime, markets are also eyeing the introduction of US President Donald Trump’s tax plan. According to some economists, slashing the corporate tax to 15% may well boost the deficit so much that the tax cut will be short lived.

Oily Corner

Oil reversed a drop on ICE Futures Europe and headed higher, defying a rise in the dollar, after the United States Department of Energy reported a surprise weekly drop in stockpiles of the benchmark fossil fuel commodity. The increase of 3.4 million barrels in gasoline measured in stock was lower than in the earlier update from the American Petroleum Institute, while a jump in inventories of distillates of 2.7 million capped the rebound of crude in the market.

West Texas Intermediate for shipment in June advanced at one point reaching a session high of $50.1. Brent for delivery in the same month edged was also in the green, changing hands for $52.22 per barrel.

Corporate Earnings

On the earnings front, Boeing released quarterly results. The blue chip company's earnings topped the consensus view by almost 4%, but revenue was slightly under expectations. Boeing fell 1.5%.

Burger King operator Restaurant Brands reported earnings that beat views by 3%. Also, revenue rose 9% also topping estimates. Restaurant Brands also encompasses Tim Hortons and recent acquisition Popeye's Louisiana Kitchen.

Seagate Technology saw a drop of around 12% at the start of regular trade. The hard disk drive maker reported mixed Q1 results, with revenue coming in just below analyst targets, but management said demand remained stable.

Computer accessories maker Logitech (LOGI) swept up 6% at the open. The Switzerland-based manufacturer posted better than expected Q4 profit and sales and announced a $250 million share buyback initiative.

The social media platform Twitter reports adjusted Earnings per shares of $0.11 in the first quarter of 2017. The firm’s revenue amounted to $548 million in the first three months of the year decreasing 8% year on year. The counted active users marked a rise of around 6% compared to the same period in 2016. The company also reported that its daily active usage also grew. The share prices surged around 10%.

On the downside, US steel was in the red after reporting a surprise loss of 83 cents a share vs. expectations for a 35-cent per-share profit. Revenue rose 16%, less than expected, and the company lowered its full-year guidance to half of consensus expectations.

Disclaimer:

This article was issued by Rodrick Duca, Trader at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri Investment Services Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.