Stock Market Today: Mixed Earnings Drive Mixed Markets

It was a mixed session in the stock market today. As earnings season intensifies, so do the reactions. Investors are trying to juggle all sorts of mixed commentary, ranging from beat-and-raise quarters to top- and bottom-line misses accompanied by guidance cuts.

stock market today

It doesn’t help that we have a mixed international picture, an ongoing trade war with China and Brexit dragging on. After balancing the positives and negatives, the indices were set to end close to flat on the day. A late-session push helped boost the gains, though. 

The SPDR S&P 500 ETF (NYSEARCA:SPY) jumped 0.27%, the SPDR Dow Jones Industrial Average (NYSEARCA:DIA) climbed 0.15% and the PowerShares QQQ ETF (NASDAQ:QQQ) rallied 0.19%.

Making Things Complicated

Caterpillar (NYSE:CAT) reported its third-quarter earnings before the open. Earnings of $2.66 per share missed analysts’ expectations by 24 cents and declined 7.5% year-over-year. Revenue of $12.76 billion sank 5.6% year-over-year and badly missed estimates, coming up short by $730 million. Further, management cut its earnings outlook for the year. 

So why then did shares rally more than 1% on the day? Well, management also said it would cut production and talked more favorably of the tariff situation. Still though, this is not the reaction many would have looked for given the headlines.

Then there’s Texas Instruments (NASDAQ:TXN). Like CAT, TXN also missed on earnings and revenue expectations, as revenue sank more than 11% year-over-year. Management also cut its full-year earnings and sales outlook. 

In Tuesday’s after-hours session, there were talks about the doom this report would cast over the semiconductor, chip and memory space. Yet, by lunch many stocks in the semiconductor space were in positive territory. That includes Nvidia (NASDAQ:NVDA), Advanced Micro Devices (NASDAQ:AMD) and Micron (NASDAQ:MU). 

These three couldn’t hold their gains, but they maintained well off the lows, unlike TXN which faded after an afternoon rebound. Still, this gave investors a very mixed picture of the space. 

Finally, Boeing (NYSE:BA) was all over the map Wednesday. Shares gapped higher off the open, running more than 4% to $350.80 despite in-line revenue results and missing on earnings per share estimates. However, shares gave up those gains toward the close as investors digested the news. 

Shares ultimately ended higher by 1% thanks to a late-session push and landed in the Top Stock Trades column

Movers in the Stock Market Today

Shares of Apple (NASDAQ:AAPL) hit new all-time highs in Wednesday’s session. The move comes on the back of another price target hike, this time from Morgan Stanley. The analyst raised the firm’s target to $289 from $247, implying almost 20% upside after Wednesday’s rally. The analysts are bullish on Services revenue growth and multiple expansion. 

Further, Bernstein analysts also raised their price target, to $225 from $205. However, that target actually implies about 7% downside.

Disney (NYSE:DIS) should hit 8 million subscribers for its Disney+ streaming service “out of the gate,” according to MoffetNathanson analysts. The analyst believes Disney will gain more traction, having a total of 18 million subscribers by the end of 2020. Helping to drive new subscriptions are a mix of promotions, discounts and partnerships, the latest of which comes with a free year of service for Verizon (NYSE:VZ) unlimited customers. 

While Boeing has had issues with its 737 MAX jet, the company is making progress with the 777X. General Electric (NYSE:GE) delivered its first GE9X engine that’s flight compliant with regulators, allowing the 777-9 test flights to resume. The 737 MAX issues have taken a toll on Boeing and haven’t been good for GE either. 

Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) made some unexpected headlines on Wednesday, announcing that it’s achieved a quantum-computing breakthrough. The company said its new 54-qubit processor performed a computation in roughly 200 seconds, obliterating the time it would take the world’s current fastest supercomputer to do the same thing. The latter’s time? About 10,000 years. 

According to the company’s post: “This dramatic increase in speed compared to all known classical algorithms is an experimental realization of quantum supremacy for this specific computational task.”

While we’re talking about GOOGL stock, it received a new Street-high price target. Credit Suisse analysts bumped their target to $1,700 from $1,500, while maintaining their “outperform” rating. 

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long GOOGL, DIS and AAPL.

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