Friday, April 27, 2018
What to watch today
After the market close on Thursday, Amazon (AMZN) crushed earnings expectations and gave guidance that topped estimates, sending shares of the e-commerce giant to an all-time high after hours. Shares of Amazon were up as much as 7% on Thursday after earnings with this rally bringing the company’s market cap to within $50 billion of Apple (AAPL), the world’s largest company by market cap. And in addition to Amazon’s rally, shares of chipmaker Intel (INTC) were also up better than 7% in after hours trade following earnings that impressed.
And while the earnings flow will slow down some on Friday, the morning will bring investors the week’s biggest economic report — the first estimate of first quarter GDP.
Two Koreas agree to end war this year: North Korean leader Kim Jong Un and South Korean President Moon Jae-in agreed Friday to finally end a seven-decade war this year, and pursue the “complete denuclearization” of the Korean Peninsula. The two leaders embraced after signing the deal during a historic meeting on their shared border, the first time a North Korean leader has set foot on the southern side. [Bloomberg]
SEC’s Clayton won’t blindly allow corporations to ban shareholder lawsuits: In a comprehensive letter to Congresswoman Carolyn Maloney (D-NY) obtained by Yahoo Finance, SEC Chair Jay Clayton gave shareholder advocates causes for both relief and concern about whether the agency will make it harder for investors to sue public companies. Clayton clarified how the agency would handle whether corporations would be allowed to IPO with arbitration clauses preventing shareholders from suing the company in court — long considered a standard part of shareholder rights. [Yahoo Finance]
Starbucks declines after coffee promotions fail: Starbucks Corp.’s (SBUX) half-off drink deals and extra rewards offers helped it meet expectations in the latest quarter, but the shares dropped — a sign investors were expecting more. The coffee giant said adjusted profit met estimates, while comparable sales —a key metric — showed growth slightly above projections. Chief Financial Officer Scott Maw assured investors in a statement Thursday that the company is investing “strategically and with a ‘long game’ mentality.” [Bloomberg]
Japan’s Fujifilm has reopened merger talks with Xerox: Fujifilm Holdings Corp. and Xerox Corp. (XRX) have reopened talks about their $6.1-billion merger agreement, a Fujifilm spokeswoman said, confirming what sources in the United States had told Reuters on Thursday. [Reuters]
Companies feel the impact of rising oil prices: The highest oil prices in years are increasing expenses for companies that had grown used to low energy costs since crude’s 2014 tumble. Giant outfits from American Airlines Group Inc. (AAL) to 3M Co. (MMM) have warned this week about how persistent higher oil prices are boosting their expenses this year. In response, some companies are looking to pass on the costs to their customers, which would push inflation higher. That, in turn, could slow growth and weigh on an already vulnerable stock market. [The Wall Street Journal]
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