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Markets Breathe As Earnings Roll In

Published 01/27/2019, 02:27 AM
Updated 07/09/2023, 06:31 AM

In a shortened week, there were plenty of earnings reports of note. The chip sector generally had a nice week with good numbers posted by Texas Instruments (NASDAQ:TXN) and Xilinx (NASDAQ:XLNX), offset by poor guidance at the 800-pound gorilla, Intel (NASDAQ:INTC). Southwest, long the best company in the airline's area, posted better profit and traffic figures than expected. Spice giant McCormick (NYSE:MKC) missed for the first time in many years and gave a downbeat forecast. Giants in the rail and pharma sectors, Union Pacific (NYSE:UNP) and Johnson & Johnson (NYSE:JNJ) beat expectations but the market remains unimpressed, especially with JNJ.

Comcast (NASDAQ:CMCSA) posted a nice quarter with its well-balanced business of connectivity and content. In the oil sector, Halliburton (NYSE:HAL) exceeded estimates but warned about a slowing China and cutbacks in exploration and production budgets. Also in the energy area, the continuing crisis in Venezuela continues to emote rumors of sanctions from the Trump administration on Venezuelan oil, which could be either imports or exports. Venezuela’s heavy oil is exported to the Gulf Coast refiners. Refiners have been running at full capacities for a long time, but crack spreads for gas has dropped quite low, with distillate prices for diesel and jet fuel remaining solid. The oil majors will report their earnings in a week or so, and I am sure they will comment on that situation as well.

On deck for the market over the next five days will be the always important press conference by Federal Reserve Chairman Powell. He is scheduled to speak on Wednesday after the Open Market Committee meets for two days. On the earnings front, plenty of heavyweights will report as well, including 3M (NYSE:MMM), McDonald’s (NYSE:MCD), Amgen (NASDAQ:AMGN), eBay (NASDAQ:EBAY), AT&T (NYSE:T), Harley-Davidson Inc (NYSE:HOG), HCA-Healthcare, Xerox (NYSE:XRX), Wynn Resorts Limited (NASDAQ:WYNN), and Rockwell Automation (NYSE:ROK).

In the mess that we call politics, it seems appropriate that the government has been shut down for nearly a month. Both sides bear responsibility, and it is fitting and also unfortunate for the country. With air travel affected, and many predicting a more severe economic slowdown because of the political dysfunction, it seems self-inflicted wounds are the standard operating procedure of the United States government, regardless of which political party is running the show. It is further evidence of why trying to work on one's own situation, improving areas that need fortifying and being a well-balanced individual, just as Fowler suggests, are probably a better use of one’s valuable time.

Yale Bock, Y H & C Investments, its clients, and the family of Yale Bock have positions in the securities mentioned in the blog, Investing in securities involves risk and the potential loss of ones principal. Past performance is no guarantee of future results. All investment decisions should be considered with respect to ones risk tolerance, return objectives, liquidity needs, tax considerations, and one's overall financial situation. The fact that Yale Bock has earned the right to use the Chartered Financial Analyst in no way means or guarantee performance better than market indexes.

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