Big tech beats buoy stocks

Big tech changing economy ‘right before our eyes’: BlackRock Global Fixed Income CIO

BlackRock Global Fixed Income CIO Rick Rieder on technology’s impact on the economy, the Fed keeping rates low and global economic growth.

Tech stocks led the major averages higher on Friday after strong earnings from four of America’s biggest companies.

Continue Reading Below

The tech-heavy Nasdaq Composite rose 1.5 percent in the opening minutes of trading while the S&P 500 climbed 0.55 percent. The Dow Jones Industrial Average added 46 points, or 0.18 percent.

Looking at stocks, Apple Inc. announced a 4-for-1 stock split after reporting record revenue and earnings growth for the three months through June. The tech giant’s revenue rose 11 percent during the quarter while earnings grew by 18 percent.

Amazon Inc. reported quarterly revenue surged 40 percent year-over-year as the COVID-19 pandemic boosted its online shopping and cloud services businesses. The e-commerce behemoth’s profit doubled to a record $5.2 billion.

Google-parent Alphabet Inc. beat Wall Street expectations on both the top and bottom lines, but advertising revenue fell 8 percent from a year ago, driven by weakness in its search business.

Facebook Inc. revenue grew 11 percent from a year ago as user-engagement increased while Americans hunkered down at home to ride out the COVID-19 pandemic. Despite the better-than-expected results, some analysts made note of the slowdown in revenue growth, which had averaged gains of almost 25 percent over the previous four quarters.

Elsewhere on the earnings front, Dow component Caterpillar Inc. reported its quarterly profit plunged 70 percent from a year ago, but managed to exceed Wall Street estimates.

Oil giant Chevron Corp. booked a $2.6 billion writedown of its Venezuela operations and another $1.8 billion charge due to its forecast for lower commodities prices. Overall, the company lost $8.3 billion during the quarter as the COVID-19 pandemic zapped oil demand.

Rival Exxon Mobil Corp., meanwhile, lost money for a second quarter in a row, recording a $1.1 billion loss.

Ford Motor Co. saw its quarterly profit increase 11-fold versus last year to $1.1 billion, but warned it expects a loss for 2020. The automaker paid down $7.7 billion of $15.4 billion borrowed through revolving credit facilities and said it has plenty of cash on hand should COVID-19 cause more production to go offline.

Athletic apparel maker Under Armour Inc. sales fell 41 percent as stay-at-home orders shuttered retailers across the country, but results topped expectations as online sales experienced “significant” growth.

Looking at commodities, gold was higher by $28.70 to $1,995.50 an ounce after earlier crossing $2,000 for the first time while West Texas Intermediate crude oil added 34 cents to $40.26 per barrel.

U.S. Treasurys were little changed with the yield on the 10-year note holding near 0.54 percent.


In Europe, Germany’s DAX and France’s CAC were trading higher by 0.73 percent and 0.13 percent, respectively, after data showed European Union gross domestic product slumped by a record 11.9 percent from the prior quarter. Meanwhile, Britain’s FTSE was weaker by 0.28 percent.

In Asia, Japan’s Nikkei fell 2.82 percent, Hong Kong’s Hang Seng lost 0.47 percent and China’s Shanghai Composite added 0.71 percent.

Source: Read Full Article