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Here are 3 things to know about stocks right now
- The Dow Jones Industrial Average index fluctuated Tuesday after the collapse of Home Depot (HD).
- Home Depot posted lower-than-expected earnings for the fourth quarter and is forecasting slower earnings growth in 2019. The stock fell 2%.
- Tesla (TSLA) rose 1% after the Securities and Exchange Commission asked a judge to convict Elon Musk, chief executive, for contempt of court for breaking the terms of his settlement with the agency. a recent tweet.
Wall Street: overview
Inventories fluctuated on Tuesday, Feb. 26, after Home Depot (HD) posted weaker-than-expected fourth-quarter earnings and US housing starts in December fell sharply.
The Dow Jones Industrial Average rose 4 points, or 0.02%, to 26,096, the S & P 500 by 0.11% and the Nasdaq by 0.02%. The consumer confidence index released in February (131.4) boosted the Dow, well ahead of economists' forecasts at 124.
US Federal Reserve Chairman Jerome Powell told US lawmakers on Tuesday that the central bank plans to reconsider its efforts over the past few years to reduce its $ 4 trillion balance sheet, given recent "cross currents" on markets and the global economy.
The Fed has reduced its balance sheet since 2017, after inflating its total assets by about $ 900 billion in the aftermath of the 2008 financial crisis. Balance sheet reduction was part of the "normalization" of monetary policy, essentially an effort to tighten financial conditions to prevent the overheating of the economy.
Housing starts in December fell 11% to $ 1.08 million a year, the lowest level in two years. This is the lowest level since September 2016. Building permits increased by 0.3% to reach an annual rate of 1.33 million.
"The main obstacles to better and higher new housing construction have been the decline in consumer and small business confidence, coupled with the prospect of rising interest rates, lower costs commodities and persistent turbulence in financial markets, "said Steven Skancke, chief economic advisor at Keel Point. . He pointed out that the closure of the government, which ended on 25 January, delayed data collection and "made it more difficult to determine the precise dates of the start and end of construction".
Meanwhile, Donald Trump landed on Wednesday in Vietnam for a summit with North Korean leader Kim Jong Un in Hanoi, during which the two men will try to consolidate the terms of their 2018 meeting in Singapore aimed at the denuclearization of the peninsula. Korean.
Trump told reporters Monday in Washington before traveling to the region, however, that his commercial team was "very close" to reaching an agreement with China after weeks of negotiations between Washington and Beijing, adding that "it could produce enough soon, or might not happen at all. "
Home Depot fell 2% after its earnings were lower than expected, thanks in part to a $ 247 million charge related to its Interline brand division and a forecast of a slowdown in earnings growth in 2019 to the home improvement retailer.
Home Depot said earnings per share of $ 2.09, far from the consensus of $ 2.16 set on Wall Street. Revenues were $ 26.5 billion, up 10.8%, but did not reach the consensus estimate. Home Depot reported receiving a 16-cent charge during the quarter related to its Interline Brands division.
In 2019, The Home Depot reported comparable store sales growth of approximately 5%, after a 4.2% fourth quarter rate and a 3.7% rate in the United States. The 2019 annual result is expected to grow by 3.1 percent to $ 10.03 per share, well below Refinitiv's forecast of $ 10.26, and total revenue is expected to grow 3.3 percent, for a total $ 111.77 billion.
US District Judge Alison Nathan said Tesla's president (TSLA), Elon Musk, is expected to write to the court on March 11 at the latest and plead his case after the Securities and Exchange Commission announced on Monday that it was "deadly". a tweet from Musk had revealed Important information about the production schedule of Tesla violated a settlement signed in October 2018 that prohibited Musk from sharing information about the company without the prior agreement of a Jural advisor.
"The accused Elon Musk must submit to this Court, before March 11, 2019, a statement setting out the reasons, if any, why he should not be found guilty of contempt of the final judgment of the Court" , wrote Judge Nathan.
The settlement itself, concluded through the intermediary of Judge Nathan, was linked to a tweet of August 2018 from Musk regarding privatization plans of the electric car maker, which the SEC said was misleading to them. investors.
Tesla rose 1% in trading on Tuesday.
Caterpillar (CAT) lost 2.7% on Tuesday after UBS lowered its rating to the heavy machinery maker and warned that earnings and profit forecasts would be under pressure amid a slowdown in the global economy.
UBS lowered its rating on Caterpillar shares with the purchase and lowered its price target by approximately 20% to US $ 125. gas production will reach its peak in 2019. This probably means that earnings forecasts for 2020, which are based on a consensus of $ 13.27 per share and imply an 8% growth over the previous year, are too high.
Macy's (M) announced a higher than expected fourth quarter profit and said comparable store sales in 2019 could increase thanks to a savings program of about $ 100 million. . The stock has increased by 0.5%.
Macy's earned $ 2.72 a share, far ahead of analysts' forecasts of $ 2.53. Revenues fell 2.5% to $ 8.455 billion, but were just ahead of analysts' estimates of $ 8.44 billion.
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