Analytics, 15 October 2019
Daily comment Oct 15
- Wall St opens higher as earnings season kicks-off
- GS -2.0% on 3Q rev. and EPS miss
- JPM +1.8% on strong 3Q EPS
- Citi -1.0% despite profit beat
- JNJ +1.7% on raised FY guidance
- Brexit deal could be reached this week
- WTI -0.4%
Market movers:
- Goldman Sachs (-2.0%): misses on revenue and EPS. Rev. -3.8% y/y to $8.32bn, vs est. $8.31bn. IB rev. -15% y/y to 1.69bn vs est. $1.8bn. Equities rev. +4.8% y/y to $1.88bn vs est. $1.82bn. Adj. EPS -23.7% y/y to $4.79 vs. est. $4.86. CEO said GS continues investing in growth opportunities, highlighted mixed operating environment. (https://bit.ly/2oJqjB0)
- JPMorgan (+1.8%): reported revenue and EPS above estimate. Rev. +8.1% y/y to $30.06bn,vs est. $28.47bn. FICC sales & trading rev. +25% y/y to $3.56bn vs est. $3.09bn. IB revenue +8.1 y/y to $1.87bn vs est. $1.8bn. Adj. EPS +14.5% y/y to $2.68 vs est. $2.46. (https://bit.ly/33C0H7J)
- Citi (-1.0%): reported revenue and EPS beat. Rev. +1% y/y to $18.6bn vs est. $18.5. IB rev. +4% y/y to $1.2bn vs est. $1.12bn. FICC were flat y/y at $3.21bn vs est. $3.02bn. Equity revenue - 4% y/y to $760mn vs est. $776mn. Adj. EPS was $1.97 vs est. $1.95 driven by 10% cut in avg shares outstanding. CEO highlighted the strength of the US consumer. (http://citi.us/2MGnnx3)
- Johnson & Johnson (+1.7%) reported EPS beat, raised guidance. Rev. +1.9% y/y to $20.7bn vs est. $20.1bn helped by growth in pharmaceuticals. Pharm. rev. + 5.1% y/y to $10.88bn vs est. $10.41bn. Adj. EPS + 3.4% y/y to $2.12 vs est. $2.01. JNJ raised its FY outlook: sees Adj. EPS in a range of $8.62 to $8.67 (saw $8.53 to $8.63); sees rev. - $81.8bn to $82.3bn (saw $80.8bn-$81.6bn). (https://bit.ly/2q8pvWz)
- Wirecard (-14.3%): FT published documents on the company’s accounting practices alleging an effort to inflate sales and profits. Wirecard rejected allegations. (https://on.ft.com/2MLnTK0)
Macro:
- According to Bloomberg, China will not buy US agricultural goods in accordance with “phase one” unless both sides remove tariffs. (https://bloom.bg/2VHxzcE)
- Trump announced sanctions against Turkey officials over the country’s invasion into Syria. (https://on.wsj.com/2VENdFK)
- EU Brexit negotiator, Michel Barnier, indicated the possibility of Brexit deal by the end of the day. (https://reut.rs/35u99rw)
- Meanwhile, UK submitted a new plan to Brussel, that addresses Irish border problem. (https://bloom.bg/32iMdts)
Commodities:
- WTI (-0.4%): US crude stockpiles rose by 3.1mn bls last week, according to Bloomberg survey. Official data due on Thursday.
Coming up:
- Fri (10/18): China 3Q GDP data are due