Technology stocks surged on the final trading day of the month, driven by blowout earnings for major U.S. technology companies. But signs of increasing global economic troubles due to the coronavirus pandemic were keeping the gains in check.
(ticker: AAPL) and e-commerce group
(AMZN) posted earnings on Thursday afternoon that blew past analysts’ expectations.
(FB) and Google parent
t (GOOGL) posted solid, if less jaw-dropping, results.
Apart from reporting more than $11 billion in profit, Apple also announced a four-to-one stock split. Apple, Amazon and Facebook shares jumped 5.7%, 4.7% and 7.3%, respectively, in early trading.
The Dow Jones Industrial Average was nearly flat, down eight points shortly after the open of trading. The S&P 500 crept higher by 0.2%. The Nasdaq Composite was up 0.7%, thanks to the performance of the tech giants.
Meanwhile, late Thursday night, Congress was unable to strike a deal with White House officials on a new coronavirus stimulus deal. The pressure to reach an agreement is high as the supplemental $600 per week unemployment benefit is set to expire after Friday.
Stoxx Europe 600 index
rose 0.6% on Friday, a day after posting the worst one-day loss in four weeks. Asian stocks finished mixed, weighed down by concerns over the U.S. economy, though the China CSI 300 rose 0.8% after data showed China’s manufacturing recovery picked up.
Thursday’s U.S. session ended with a drop of more than 200 points for the Dow, after U.S. gross domestic product fell at a 32.9% annualized rate in the second quarter, a stunning decline even as it largely met economists’ expectations. Weekly jobless claims rose for the second-straight week.
Fresh coronavirus outbreaks in Southern states and elsewhere in the U.S. have forced some businesses to close again, weighing on hopes of a recovery.
“What is probably more worrying for investors appears to be the realization that the negative headlines with respect to a possible second wave will only make it that much more difficult to achieve any sort of prospect of a V-shaped recovery, particularly since the U.S. labor market rebound appears to have come to a halt,” said Michael Hewson, chief market analyst at CMC Markets, in a note to clients.
Outside of the U.S., countries are also starting to grapple with the virus’s resurgence. The U.K. government imposed fresh lockdown restrictions on northern swaths of England late on Thursday, while Spain and Belgium are also battling outbreaks. The eurozone economy slumped 12.1% in the second quarter, for a drop of 15% year-over-year, the Eurostat statistics agency reported Friday.
Gold prices resumed a march toward $2,000 an ounce, with futures rising 0.7% to $1,980.40 an ounce. Oil ticked up with the price of West Texas Intermediate crude climbing 1.3% to $40.44 a barrel.
(CVX) shares were off by 3.4% in early trading after posting an $8.3 billion loss for the second quarter due to asset write-downs linked to low fuel prices and an impairment of its investment in Venezuela. Adjusted losses of $1.59 a share were worse than the 93-cent loss analysts expected.
(XOM) also reported financial results before the bell. Its shares dipped 0.1% after it posted an adjusted loss of 70 cents a share, which was wider than the 61-cent loss analysts expected
(CAT) shares slipped 1.4% despite posting adjusted earnings of $1.03 a share on revenue of $10 billion, which beat analysts estimates.
Pinterest (PINS) stock rallied 29% after the social-media company reported better-than-expected quarterly results.