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Jared Blikre of Yahoo Finance reports on today’s trend tickers.
Video transcript
ALEXIS CHRISTOFOROUS: Let’s turn it over to Jared Blikre for a reason we’re seeing such a decline today. And I know we have more corporate earnings news – you’ll start with one of the big banks, Morgan Stanley. But what’s holding back investors today, Jared?
JARED BLIKRE: Well, I think overall we haven’t had that big of a deal in NASDAQ. And we had record breaking Apple, Microsoft, Amazon – they contributed. But we haven’t seen a lot of follow-up on some of the other stocks here. Very narrow leadership therefore creates a sort of vacuum.
And it’s not easy to maintain that, because you have days like this where you just have these great downdrafts. Having said that, we are only at 1%. But I am talking about the big banks here. Morgan Stanley is the last of the Big Six Wall Street banks to report here. And you can see that they managed to climb the green for part of the day on YFi Interactive. And I have some notes from “Bloomberg” on exactly what we did with their earnings.
Now they are continuing their streak of high investment banking fees and income that we saw earlier in the week from JP Morgan, Goldman Sachs, et cetera. But they had a little hiccup in fixed income. And that might be a reason they aren’t as strong as they might have been otherwise when we look at the stock price.
Now James Gorman, the CEO, has had a few words on wealth management. This is an area where many banks, including Bank of America, are tackling very aggressively as millennials accumulate more money. He said, we are creating a new mousetrap, and noting that new net assets are unlikely to fall below 5%, although he does not know exactly where they are going to settle.
But the bank feels like it’s creating a high-growth advisory channel to retrain its advisers – keep their advisers, and their results have also been boosted by some of their mergers – their integration into e-commerce and Eaton Vance. So they have a bigger retail footprint – Morgan Stanley isn’t really known as a retail deposit bank. And then I have another note here from Evercore, saying, good solid quarter for Morgan Stanley, with growth in all the lines you’d expect as the strong performance in asset and wealth management, mergers and Acquisitions and equities more than offset the expected normalization of the FIC and lower rates on net interest income and prepayments.
At the end of the day, the banks had really good profits, but the bar was very high. And they kind of suffered from a trade slump compared to the same quarter a year ago, when all that volume, of course, was recovering from the pandemic.
ALEXIS CHRISTOFOROUS: I want to come to our number one trend ticker of the day, which is Taiwan Semiconductor Manufacturing US-listed stocks. They are under some pressure here. I guess investors weren’t too happy with their last earnings report.
JARED BLIKRE: Yes, and it is a very large company. It is one of the largest manufacturers in the world. Many companies outsource all or part of the manufacturing of their chips to them, such as Nvidia. So what they have to say is very important.
Now their margins were under pressure during the quarter, but the outlook was pretty good. And I have some Wall Street notes here. Needham with a buy said the results exceeded our conservative estimates, but missed the consensus due to excessive expectations for gross margins. And Wedbush, who owns it with an outperformance, saying earnings and gross margins missed slightly due to currency headwinds, although sales were generally on the right track.
And I also have another comment here – the company is positive for Taiwan Semi, given revenue growth and a high demand environment for Foundry – it’s manufacturing – which we hope will last. for much, if not all, of 2022 So the outlook is still pretty good here, but they have been under pressure on their margins for the quarter, Alexis.
ALEXIS CHRISTOFOROUS: And we got to get into Netflix, because it looks like they’re finally keeping their promise to expand beyond just showing their movies. And now they want to get into the video game industry. And I understand that they made a fairly large hire for this purpose. What can you tell us?
JARED BLIKRE: Well I think it’s a really big move. It’s not a pivot, as they don’t change their business model, but we’ve seen this before with Reed Hastings, one of the founders of Netflix when he went from those posted DVDs to streaming, and also when ‘he launches into the content. . So this is only the last push.
Now I also have some analyst comments on this. Truist claiming that the fact that Netflix is taking steps to get into the game is positive for the company, although questions remain around the content strategy, such as whether Netflix should create its own content or bring third-party content to the platform. Here’s another quote: “At the margin, games and interactivity can differentiate Netflix from live streaming peers and help with engagement, retention, possibly monetization and ultimately membership growth.”
So we’ve spoken to a number of analysts here today, and here’s a look at the stock year so far – they think it’s going to be a slow process. They’re just gonna wade through the water here. Reed Hastings isn’t just going to jump in and spend billions of dollars creating game content. It could very well come later. But it is nevertheless a very interesting development for the streaming space.
And by the way, we’re going to be talking about stocks even here – I’m just going to say that GameStop has been under pressure all day, down about 4.5%. And some analysts say it’s because of their competition, potentially, with Netflix on the road.
ALEXIS CHRISTOFOROUS: Yeah, I saw that, actually. I saw GameStop was another big trending ticker today as well. Speaking of meme stocks, good track here – AMC, one of the original meme stocks, had a hard time. I know there was a four day slip there. It is still quite a ways from its peak this year. But it looks like it’s bouncing back, at least for today.
JARED BLIKRE: Yeah, no fundamentals here today. So we’ll just take a look at the technical characteristics of YFi Interactive. Here is AMC – managed to climb into the green, but he returned almost all of his winnings. It was up about 4% or 5% earlier. Looking at the five day view here, you mentioned that they were in a four day slide – they could be five if they dip into the red at the close – so a 30% drop over five days is a big one. not for a stock of the same.
And just looking at a slightly longer view here, here’s a one-month chart you can see – down 43% over that same period. But then, in perspective, since the beginning of the year, the cumulative gains of 1,476% are maintained, Alexis.
ALEXIS CHRISTOFOROUS: Alright, Jared, thank you very much.
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