Global Market Update
Canada’s Stock Market Gains as Gold and Oil Prices Support Sentiment
Canada’s main stock index, the S&P/TSX Composite Index, climbed to a seven-week high on Wednesday, buoyed by strength in the gold and energy sectors. The rally was driven by a weaker U.S. dollar, which made commodities priced in USD more attractive, leading to gains in gold, copper, and aluminum prices. Oil prices also rose after it faced recent downward pressure for many consecutive sessions. The Bank of Canada cut interest rates down to 3 percent, from 3.25 percent to deal with economic headwinds., which helped lift sentiment.
U.S. Stock Markets Mixed, Nasdaq Slips Again
In the U.S., stock indexes showed a mixed performance, as investors digested fresh economic data and corporate earnings.
- The Nasdaq Composite initially opened higher but fell into negative territory later in the session, extending its recent downtrend as technology stocks faced renewed selling pressure.
- The S&P 500 traded near record highs, supported by strong earnings from consumer and healthcare companies.
- The Dow Jones Industrial Average saw modest gains, lifted by energy and industrial stocks.
Market sentiment remained cautious as investors weighed the latest comments from Federal Reserve Chair Jerome Powell, who reaffirmed the central bank’s commitment to maintaining stable economic growth. Powell’s remarks indicated that inflation remains a concern, but the overall economy continues to exhibit strength.
European Stocks Hit New Highs, ECB Cuts
In Europe, the STOXX 600 surged to an all-time high, led by gains in the real estate and technology sectors. Investors pushed stocks higher, optimistic over the European Central Bank’s (ECB) policy decision to cut interest rates to 2.75 percent in order to maintain a supportive stance to sustain economic recovery, and brace against possible American tarries.
In the UK, London’s FTSE 100 also reached a record high, as upbeat corporate earnings fueled investor enthusiasm. The index was further lifted by commodity-linked stocks, which benefited from rising metal prices.
Corporate Stock News
- Altria Group Inc: A U.S. trade tribunal sided with Juul Labs in a patent dispute, resulting in a ban on imports of vaping devices and cartridges made by Altria’s NJOY brand.
- Ameriprise Financial: Reported a 24% rise in Q4 profit due to higher fee income from increased client assets. AUM reached $1.52 trillion, up 10% YoY. Adjusted EPS rose to $9.36 from $7.20.
- Beta Bionics: Raised $204 million in its IPO, with a valuation of $700 million. Shares will trade on Nasdaq under “BBNX.”
- Blackstone Inc: Exceeded Q4 profit estimates due to increased dealmaking. AUM reached a record $1.13 trillion. Fee-related earnings surged 76% to $1.84 billion. Distributable earnings rose 56% to $2.2 billion.
- Caterpillar Inc: CAT Q4 profit declined due to weak demand and reduced equipment restocking by dealers. Adjusted EPS fell to $5.14 from $5.23. Revenue dropped to $16.22B from $17.1B YoY.
- CH Robinson Worldwide Inc: Surpassed Q4 profit estimates with cost cuts and strong demand in ocean and air shipments. Adjusted EPS came in at $1.21, exceeding expectations of $1.11. Revenue fell by 1% to $4.18B.
- Check Point Software Technologies Ltd: Beat Q4 profit expectations. Revenue exceeded $2.5B in 2024, with AI adoption expected to drive 2025 growth. Adjusted EPS rose 5% to $2.70.
- Cigna Group: Forecasted annual profit below estimates due to higher medical costs. Q4 adjusted EPS was $6.64, missing estimates of $7.82. Medical care ratio increased to 87.9% from 82.2%.
- Comcast Corp: Surpassed Q4 revenue forecasts despite losing broadband customers. Announced $15B buyback. Peacock revenue grew 27.8%, while theme park revenue was flat at $2.37B.
- Crown Castle Inc: Zayo Group is leading an $8 billion deal to acquire Crown Castle’s fiber broadband assets.
- Dow Inc: Missed Q4 profit estimates and announced 1,500 layoffs as part of a $1B cost-saving plan. Adjusted EPS was breakeven. Packaging and specialty plastics revenue fell 5.8%.
- Flagstar Financial Inc: FLG narrowed its Q4 loss due to lower loan default provisions. Net loss was $168M ($0.41/share), a significant improvement from last year’s $2.7B loss.
- IBM: Exceeded Q4 expectations with strong software demand. Revenue was flat at $17.55B. Forecasts 5% revenue growth in 2025. Adjusted EPS was $3.92, above the expected $3.75.
- Lam Research Corp: Forecasted Q3 revenue above estimates, driven by AI-related chip demand. Expects $4.65B revenue, surpassing the $4.34B estimate. Q4 revenue of $4.38B exceeded forecasts.
- Las Vegas Sands Corp: Missed Q4 profit expectations, primarily due to weak Macao performance. Adjusted EPS was 54 cents, below the expected 58 cents. Macao revenue fell 5% to $1.86B.
- Lazard Inc: Reported higher Q4 profit, driven by a 6% rise in financial advisory revenue. Adjusted net income increased to $85M ($0.78/share) from $65M ($0.66/share).
- Levi Strauss & Co: Despite strong Q4 sales, forecasted annual profit below expectations. Expects adjusted EPS of $1.20–$1.25, below consensus of $1.37. Q4 revenue rose 8% to $1.84B.
- Danaher Corp: Jefferies cut its target price to $260 from $285 due to a weaker 2025 outlook, weakness in China, and underperforming M&As.
- Deutsche Bank AG: Missed Q4 and FY 2024 profit estimates due to legal and restructuring costs. Q4 net profit fell to €106M from €1.26B. FY profit declined to €2.7B from €4.21B.
- General Dynamics Corp: RBC lowered its target price to $280 from $290 due to a miss in Gulfstream deliveries from supply chain and certification issues.
- Honda Motor Co Ltd: Investing $300M in Ohio plants to produce EVs, hybrids, and gas vehicles. Collaborating with LG Energy Solution on a $4.4B battery plant.
- Inhibikase Therapeutics Inc: Ceased development of its Parkinson’s disease drug after mid-stage trials failed to improve daily tasks.
- International Business Machines Corp: Evercore ISI raised the target price to $275 from $240 after Q4 results exceeded estimates.
- Meta Platforms Inc: Piper Sandler raised its target price to $775 from $670, citing strong Q4 earnings, AI initiatives, and positive 2025 guidance.
- Microsoft Corp: Morgan Stanley lowered MSFT target price to $530 from $540, citing concerns about AI revenue contributions in FY25.
- Merck & Co Inc: Stopped a late-stage study of its pulmonary arterial hypertension drug after previous trials showed strong efficacy.
- Molson Coors Beverage Co: Fevertree Drinks shares surged after Molson Coors took an 8.5% stake in the company and gained exclusive rights to market its products in the U.S.
- Mobileye Global Inc: Issued a weak 2025 revenue forecast due to slower China shipments. Expects 2025 revenue of $1.69B–$1.81B, below $1.94B expected.
- Nokia Oyj: Beat Q4 profit and revenue estimates, driven by strong demand in North America and India. Sales rose 10% to €5.98B, surpassing estimates.
- Northrop Grumman Corp: Returned to profit in Q4 as B-21 Raider issues eased. Forecasts 2025 sales of $42B–$42.5B, slightly below expectations. Q4 adjusted EPS was $6.39.
- Raymond James Financial Inc: Reported a 19.5% rise in Q1 profit, driven by strong wealth management and capital markets performance. Investment banking revenue surged 80% to $325M.
- Rogers Communications Inc: Added fewer wireless subscribers than expected in Q4. Net income for the period was C$558M, up from C$328M YoY.
- Sanofi SA: Announced a €5B buyback and hinted at potential M&A activity. Q4 business income fell 7.7% to €2.08B but met estimates.
- Shell PLC: Missed Q4 profit estimates, but announced a $3.5B share buyback and a 4% dividend increase.
- ServiceNow Inc: Forecasted annual subscription revenue below expectations due to the strong U.S. dollar and changes in its monetization model.
- Southwest Airlines Co: Surpassed Q4 profit estimates, driven by strong travel demand and improved airfares. Forecasted higher unit revenue for Q1.
- STMicroelectronics NV: Warned of continued sales declines in Q1, forecasting $2.51B revenue, a 28% drop from last year.
- Takeda Pharmaceutical Co Ltd: CEO to retire in 2026. Raised its full-year profit forecast despite reporting quarterly results that trailed analyst estimates.
- Tesla Inc: Announced plans for cheaper EVs and testing a paid autonomous car service by June, though Q4 results fell short of expectations.
- Thermo Fisher Scientific Inc: Exceeded Q4 profit and revenue estimates, driven by strong demand for therapy development products and services.
- Toyota Motor Corp: Remained the top-selling automaker in 2024, despite a 1.4% decline in sales due to lower demand in Japan.
- United Parcel Service Inc: Forecasted 2025 revenue below expectations, citing a shift from Amazon and increased demand for slower deliveries.
- United Rentals Inc: Missed Q4 profit estimates but expects 2025 revenue to exceed analyst expectations.
- Valero Energy Corp: Exceeded Q4 profit estimates, aided by lower costs and higher renewable diesel margins.
- Venture Global Inc: Expects to finish repairs on its Calcasieu Pass LNG plant by February, following a nearly three-year delay.
- Vodafone Group Plc: Made the first-ever video call via satellite with a standard smartphone and plans a European rollout in 2025.
- Western Digital Corp: Forecasted Q3 revenue below estimates, expecting weaker demand from cloud and corporate customers.
- Whirlpool Corp: Plans to reduce its stake in its Indian unit to 20%, causing a 20% drop in Whirlpool of India’s shares.
- Wolfspeed Inc: WOLF exceeded Q2 revenue estimates and reported a smaller-than-expected net loss but expects Q3 revenue to fall short of expectations
STA Research (StockTargetAdvisor.com) is a independent Investment Research company that specializes in stock forecasting and analysis with integrated AI, based on our platform stocktargetadvisor.com, EST 2007.
