Market News & Analysis: October 31st, 2024

Global Markets

Canadian Markets

Canada’s main stock index dropped on Thursday, reflecting concerns over stagnant economic growth, as data revealed that the Canadian economy recorded no growth for August. This lack of economic momentum raised alarms among investors, that inflation, rising unemployment and lack of investment are weighing in on growth.

American Markets

The situation was compounded by drops in American markets, where uninspiring earnings reports from major U.S. tech giants dampened market sentiment.

Data released showed that the personal consumption expenditures (PCE) price index fell to an annual rate of 2.1%, for the month of September, down from 2.3% in August, 2024.

European Markets

In Europe, the pan-European STOXX 600 index also traded in negative territory. It was significantly impacted by disappointing corporate earnings reports, from  BNP Paribas, Smith & Nephew and AB InBev, with many other companies failing to meet investor expectations. The benchmark index is on track to register its worst monthly performance in a year, highlighting ongoing concerns about economic stability and corporate profitability in the region.  UK Markets dropped significantly, as government bond prices fell on the government releasing its budget, which showed the difficult financial state of the country as taxes jump.

Japanese Markets

Japan’s Nikkei index closed lower as investors opted to lock in profits after the Bank of Japan maintained its key interest rates. The yen traded within a narrow range, reflecting market uncertainty and a cautious outlook on the Japanese economy.

Corporate Stock News:

• Abbott Laboratories & Reckitt Benckiser: A jury was asked to make both companies pay over $6 billion regarding claims that their formulas for premature babies caused severe intestinal illness.
• Amgen Inc: Reported a higher quarterly profit driven by a 24% rise in sales for high cholesterol and osteoporosis drugs.
• Arch Capital Group Ltd: Third-quarter profit rose 37% due to higher premiums and robust investment returns.
• Booking Holdings Inc: Exceeded analysts’ expectations for third-quarter profit and revenue, driven by strong international travel demand.
• C.H. Robinson Worldwide Inc: Beat profit and revenue estimates due to cost reductions and higher pricing in ocean services.
• Canadian Natural Resources Ltd: Announced fewer dry natural gas wells due to declining prices and reported a 55.5% drop in realized natgas prices.
• Cenovus Energy Inc: Experienced a fall in third-quarter profit due to lower production and throughput volumes.
• Cheniere Energy Inc: Reported a decline in third-quarter profit affected by lower LNG margins.
• Cigna Group: Surpassed profit estimates driven by demand for biosimilars and new clients in its pharmacy benefit management unit.
• Clorox Co: Raised annual profit forecasts after beating quarterly results, with a significant rise in sales from its health and wellness sector.
• Cognizant Technology Solutions Co: Beat third-quarter profit estimates, signaling recovery in demand for IT services.
• DoorDash Inc: Forecasted above-estimate fourth-quarter profit, reporting its first profit since going public.
• eBay Inc: Projected lower fourth-quarter revenue due to cautious consumer behavior.
• Element Fleet Management Corp: Target price raised to C$33 from C$30, anticipating strong results in 2025.
• Estee Lauder Companies Inc: Withdrew its 2025 sales and profit forecasts due to a slowdown in demand for luxury products.
• Etsy Inc: Beat estimates for gross merchandise sales and revenue, announcing a new $1 billion share repurchase program.
• Equity Residential: Exceeded third-quarter revenue estimates due to strong rental demand.
• GoDaddy Inc: Raised 2024 sales forecast, expecting strong demand for online services.
• KLA Corporation: Forecasted second-quarter revenue above estimates, driven by chip demand for AI workloads.
• Linde Plc: Reported third-quarter earnings above expectations while slightly lowering the top end of its full-year forecast.
• Marathon Oil Corp: Announced layoffs of over 500 workers amid its acquisition by ConocoPhillips.
• McDonald’s Co: Linked a recent E. coli outbreak to slivered onions supplied by Taylor Farms.
• Meta Platforms Inc: Beat profit estimates but warned of increased AI-related infrastructure expenses next year.
• MetLife Inc: Reported a fall in adjusted profit, forecasting revenue below estimates for the fourth quarter.
• Microsoft Corp: Predicted increased AI spending but noted slower growth in its Azure cloud business.
• PepsiCo Inc: Overhauling brands like Lay’s due to declining snack volumes and sharing data with retailers.
• Robinhood Markets Inc: Reported third-quarter earnings below expectations due to accounting quirks.
• Shell Plc: Exceeded profit forecasts in the third quarter, reporting strong LNG sales.
• Spirit Airlines Inc: Announced plans to furlough about 330 pilots as part of cost-cutting efforts.
• Uber Technologies Inc: Surpassed quarterly profit estimates but noted slow growth in gross bookings.