Monthly Archives: June 2020

Stock futures fall slightly after the market notches its best quarter in decades

Stock futures dipped slightly in overnight trading on Tuesday as the market is set to kick off a new quarter after a remarkable comeback.

Futures on the Dow Jones Industrial Average traded about 85 points lower. The S&P 500 futures and the Nasdaq 100 futures fell 0.2% and 0.1%, respectively. Trading volumes were thin. 

The market just notched its best quarter in decades as it snapped back from the historic sell-off triggered by the coronavirus. The Dow gained 17.8% in the second quarter, posting its best quarter since 1987, while the S&P 500 finished the period with a near 20% gain, its best since 1998. The tech-heavy Nasdaq soared 30.6% for the quarter, the most since 1999.

In after-hours trading Tuesday, FedEx jumped nearly 9% after posting quarterly earnings and revenue that topped analysts’ forecast. The shipping company experienced a surge in deliveries amid the coronavirus lockdown.

While the market bounced sharply from its March lows, the recent spikes in coronavirus cases in some states kept investors on edge. White House health advisor Dr. Anthony Fauci warned Tuesday that if the outbreak continues at its current pace, daily new cases could surpass 100,000 new infections per day.

So far, more than 12 states have now paused or rolled back their reopenings as cases in the U.S. jumped 40% over the past week to an average of about 39,750 on Monday, according to a CNBC analysis of data compiled by Johns Hopkins University. 

“We continue to expect it to be an uneven process, albeit with a positive trajectory,” Keith Lerner, chief market strategist at SunTrust Advisory Services, said in a note. “The good news is through this digestion period, markets are working off some of the excesses that had built up, and elevated expectations are being reset.”

Investors will monitor the pace of recovery in the U.S. labor market. ADP will release its private payroll count for June on Wednesday at 8:15 a.m. ET. Economists polled by Dow Jones expect an increase of 2.50 million after a 2.76 million decline in May.

On the corporate front, Macy’s is set to report its quarterly earnings before the bell on Wednesday.

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Fintech start-up TransferWise is set to launch an investments feature

TransferWise co-founders Kristo Käärmann and Taavet Hinrikus.

TransferWise

Financial technology firm TransferWise has obtained a license from the U.K. markets watchdog to offer retail investment services to clients.

The London-based firm started life as a means of sending money internationally online. In 2018, it made a deeper push into banking by offering a “borderless” multi-currency account tied to a debit card.

Now, TransferWise plans to launch a service that lets users of the account invest passively in investment funds from third-party providers. The company said Wednesday that it had received permission from the U.K.’s Financial Conduct Authority to deal in investments.

“About three or four years ago we saw that people — and more so businesses — are not only sending money, they’re also receiving money internationally,” TransferWise CEO and co-founder Kristo Käärmann told CNBC in a video call.

Käärmann said the problem the platform’s users have had lately is finding a way to make a return on their cash. He added that TransferWise wanted to take a different approach to traditional banks, which lend out customer deposits and charge interest.

“It’s not like if you put money into a savings account in a bank, money magically grows there,” said Käärmann. “It’s still going to be invested in something.”

TransferWise isn’t the only fintech start-up looking to take on the investment industry. Plenty of other companies, such as Robinhood, Revolut and eToro, have gained popularity thanks to their zero-fee stock and cryptocurrency-trading features. However, Käärmann says his firm isn’t looking to act as a stockbroker.

TransferWise said it expects to launch its first investing feature in the next 12 months. Though the firm is starting with the U.K., it hopes to also roll the product out internationally later down the line.

Founded in 2011, TranferWise has swiftly risen to become one of Europe’s top fintech start-ups, securing a $3.5 billion valuation last year. The company says it’s racked up 8 million users globally and processes £4 billion worth of transactions each month. Its investors include Andreessen Horowitz, Richard Branson and Peter Thiel’s Valar Ventures.

Though the travel industry came to a halt this year due to the coronavirus pandemic, Käärmann said TransferWise still expects to turn an annual profit in its 2020 accounts. The firm has been profitable for three years running, but a big selling point of its multi-currency debit card is the ability to convert to local currencies when traveling.

“We’ve been very humbled in some ways and proud that customers are funding our mission,” he said. “They keep TransferWise running through the fees that they’re paying; they pay our salaries, they let us hire more people and grow the product.

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Stock futures flat after the market notches its best quarter in decades

Stock futures were flat in overnight trading on Tuesday as the market is set to kick off a new quarter after a remarkable comeback.

Futures on the Dow Jones Industrial Average fell about 25 points. The S&P 500 futures and the Nasdaq 100 futures were little changed. Trading volumes were thin. 

The market just notched its best quarter in decades as it snapped back from the historic sell-off triggered by the coronavirus. The Dow gained 17.8% in the second quarter, posting its best quarter since 1987, while the S&P 500 finished the period with a near 20% gain, its best since 1998. The tech-heavy Nasdaq soared 30.6% for the quarter, the most since 1999.

In after-hours trading Tuesday, FedEx jumped nearly 9% after posting quarterly earnings and revenue that topped analysts’ forecast. The shipping company experienced a surge in deliveries amid the coronavirus lockdown.

While the market bounced sharply from its March lows, the recent spikes in coronavirus cases in some states kept investors on edge. White House health advisor Dr. Anthony Fauci warned Tuesday that if the outbreak continues at its current pace, daily new cases could surpass 100,000 new infections per day.

So far, more than 12 states have now paused or rolled back their reopenings as cases in the U.S. jumped 40% over the past week to an average of about 39,750 on Monday, according to a CNBC analysis of data compiled by Johns Hopkins University. 

“We continue to expect it to be an uneven process, albeit with a positive trajectory,” Keith Lerner, chief market strategist at SunTrust Advisory Services, said in a note. “The good news is through this digestion period, markets are working off some of the excesses that had built up, and elevated expectations are being reset.”

Investors will monitor the pace of recovery in the U.S. labor market. ADP will release its private payroll count for June on Wednesday at 8:15 a.m. ET. Economists polled by Dow Jones expect an increase of 2.50 million after a 2.76 million decline in May.

On the corporate front, Macy’s is set to report its quarterly earnings before the bell on Wednesday.

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Stocks making the biggest moves after hours: FedEx, Facebook, Virgin Galactic and more

A FedEx employee wearing a protective mask and gloves loads boxes into a truck amid the coronavirus pandemic on April 28, 2020 in New York City,

Alexi Rosenfeld | Getty Images

Check out the companies making headlines after the bell.

FedEx — The shipping company’s stock climbed 9% after the closing bell following its release of fourth-quarter earnings. The shipping company reported earnings of $2.53 per share on revenues of $17.36 billion, beating analysts’ estimates of $1.52 per share on revenues of $16.4 billion, according to Refinitiv. The company reported a $125 million increase in coronavirus-related operating costs. Shares of UPS jumped 5% after the market closed. 

Facebook — The social media giant’s stock dipped about 1% in extended trading after Target announced it was suspending advertising on Facebook and Instagram for the month of July, according to a statement the retailer gave to NBC News. Target said it was going to use the pause to reevaluate its advertising plans for the rest of the year. The retailer joins a growing list of companies that have chosen to join the “#StopHateForProfit” campaign. In pausing their advertising on the social media platform, the companies are hoping to pressure Facebook into doing more to curb hate speech and the spread of disinformation. Facebook announced Tuesday that it was banning an anti-government network based in the U.S. that looks to promote violence through the boogaloo movement. The company said it removed numerous Facebook accounts, pages and groups, as well as Instagram accounts associated with the boogaloo network.

Virgin Galactic — Shares of the space travel company rose 3% after the closing bell. Virgin Galactic told CNBC Tuesday that it expects to pass the remaining Federal Aviation Administration milestones needed for final regulatory approval to conduct regular spaceflights after it completes one or two more rocket-powered test flights. Getting that approval would bring the company closer to flying out customers to the edge of space.

Inovio Pharmaceuticals — Shares of Inovio Pharmaceuticals fell about 1% in extended hours after dropping nearly 15% earlier in the day. Medical news site Stat reported earlier Tuesday that the company has not provided data necessary to determine whether its coronavirus vaccine works. Inovio claimed positive results in its clinical trial in a press release Tuesday morning but has not disclosed how many patients produced Covid-19 antibodies, according to Stat.

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