Weekly Market Insights: Earnings Reports and Oil Price Surge Explained

Past week saw significant earnings reports from Carnival, Nike, and Constellation Brands. Meanwhile, oil prices surged due to geopolitical tensions, and the labor market showed resilience in the latest jobs report.

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Major Earnings Reports:

Below are the major quarterly earnings report of past week.

1. Carnival Corporation (CCL: NYE):

Carnival reported revenue of $7.9 billion (+15% YoY) and profits of $1.7 billion (+62% YoY).  Carnival booked 50% of its 2025 availability at higher prices. It expects adjusted EBITDA to exceed $6 billion in 2024.  Despite strong financials, the stock is down 2% year-to-date. Wall Street targets $19 per share, cautious about booking trends and pricing power for 2025.

2. Nike Inc (NKE: NYE):

Nike’s revenue fell to $11.6 billion, a drop from $13.0 billion last year. Profits decreased to $1.0 billion.  The company continues to face challenges in stabilizing gross margins and sales contraction. Management expects further margin contraction next quarter.  Nike is on a multi-year recovery path. Investors remain on the sidelines, watching for signs of a bottom in gross margins and sales.

Learn More: Nike Inc Q1 Earning Analysis

3. Constellation Brands (STZ: NYE):

Revenue increased to $2.9 billion (+3% YoY) despite a net loss of $1.2 billion. Achieved $300 million in cost savings and reached its target leverage ratio, indicating potential for share buybacks or dividend hikes. Market skepticism persists due to beer consumption headwinds. However, cost-saving efforts present long-term stock appreciation catalysts.

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Notable News and Events:

Below are the major notable news and events from the past week.

1. Middle East Tensions Send Oil Soaring:

Escalating tensions between Israel and Iran caused oil prices to surge 9.1%, the largest weekly gain since March 2023. Investors remain wary of supply disruptions. Despite the rally slowing, energy markets remain volatile as geopolitical tensions unfold.

2. Employment Report:

The U.S. added 254,000 jobs in September, exceeding estimates, with unemployment falling to 4.1%.  The strong labor report reduces the likelihood of larger interest rate cuts by the Federal Reserve in November. The steady participation rate signals ongoing economic resilience.

Conclusion:

Earnings reports highlight mixed performance across sectors, with Carnival showing promise while Nike struggles. Meanwhile, oil prices and labor market dynamics indicate a complex global economic environment for investors to navigate.