Market News & Analysis:October 29th, 2024

Global Markets

Canadian Markets

Canada’s main stock index, the TSX, experienced a decline as oil prices continued their downward trajectory. The weakening in oil prices often reflects concerns over supply and demand dynamics, impacting energy stocks heavily weighted in the TSX. In contrast, gold prices saw an uptick, which typically attracts investors looking for safe-haven assets amid volatility in other markets.

American Markets

In the United States, stock indexes were mostly in the red as investors braced for a wave of corporate earnings reports. The market was particularly focused on results from tech giants Alphabet (Google’s parent company) and AMD, as these reports are critical indicators of the health of the technology sector. Analysts and investors alike are keen to assess how these companies have navigated economic challenges and whether their growth trajectories remain intact.

European Markets

Europe’s benchmark index saw modest gains, primarily driven by strong performance from bank stocks, particularly following HSBC’s positive third-quarter earnings report. This optimism in the banking sector provided a boost, but overall market gains were restrained by disappointing reports from other regional companies, indicating mixed economic signals.

Chinese Markets

In China, stocks closed lower, largely influenced by declines in energy and property sectors. The energy market’s struggles may be linked to broader economic concerns, while the property sector continues to face challenges from regulatory pressures and reduced demand. This trend reflects ongoing issues within China’s economic landscape, as policymakers grapple with growth targets.

Japanese Markets

Japan’s Nikkei index managed to secure gains for a second consecutive day, as investors bought back shares following a selloff driven by fears related to domestic election outcomes. This rebound suggests that market sentiment is stabilizing as traders regain confidence, likely seeking bargains after previous declines.

Corporate Stock News

Acerinox SA: The company reported a 32% drop in third-quarter net profit, attributed to a weak stainless steel market in Europe and North America. Despite a 21% rise in production following a strike, core profit fell over 21% year-on-year.

Adidas AG: The company experienced strong growth in Greater China, with quarterly sales rising 9% to $1 billion, marking its best performance in China since early 2022. Sales in North America also improved, excluding Yeezy products.

Banco Santander SA: The bank achieved a record net profit of $3.5 billion in the third quarter, a 12% year-on-year increase, driven by solid retail performance and strict cost controls, surpassing analyst expectations.

BP Plc: BP reported a 30% decline in third-quarter profit to $2.3 billion due to weaker refining margins and oil trading results, although its underlying profit exceeded analyst forecasts.

Brown & Brown Inc: The insurance brokerage saw a 33% rise in third-quarter profit, benefiting from increased commissions and strong investment returns, with net profit rising to $234 million.

Cadence Design Systems Inc: The company raised its annual profit forecast, driven by growth in generative AI demand for its software, reporting a 20% revenue increase to $1.22 billion in the September quarter.

Canfor Corp: CIBC increased its target price for Canfor to C$21, anticipating improved earnings in 2025.

F5 Inc: F5’s shares surged 10% after forecasting first-quarter revenue above Wall Street estimates, supported by steady demand for its software products.

Ford Motor Co: Ford lowered its full-year profit guidance, projecting earnings of about $10 billion, resulting in a 5% drop in shares after-hours.

HSBC Holdings Plc: HSBC’s third-quarter profit rose 10% to $8.5 billion, surpassing estimates due to increased wealth and wholesale banking revenues.

Magna International Inc: RBC cut Magna’s target price to $42, citing expectations of reduced light vehicle production.

McDonald’s Corp: The company reported a significant decline in global comparable sales, dropping 1.5%, its largest decline in four years, affected by weaker traffic.

Novartis AG: Novartis raised its 2024 earnings guidance but saw a dip in share price due to lower-than-expected sales of a key product.

Pfizer Inc: Pfizer raised its full-year profit forecast after better-than-expected COVID-19 treatment sales, now expecting earnings between $2.75 and $2.95 per share.

Regency Centers Corp: The company raised its annual funds from operations forecast after exceeding third-quarter estimates, driven by strong leasing demand.

Royal Caribbean Cruises Ltd: Royal Caribbean raised its annual profit forecast for the fourth time this year, benefiting from increased ticket prices and demand.

SBA Communications Corp: The company raised its annual forecast for adjusted funds from operations, anticipating steady demand for 5G networks.

Safran SA: The jet engine manufacturer plans to invest over $1.08 billion and hire 4,000 people to expand its global engine repair network.

Sino-Ocean Group Holdings Ltd: The developer plans to issue $4.02 billion in mandatory convertible bonds as part of its offshore debt restructuring.

Volkswagen: The company plans to shut at least three factories in Germany and lay off thousands as part of a significant restructuring effort.

Welltower Inc: Welltower raised its annual funds from operations forecast, betting on strong demand in the healthcare real estate sector.