Stock Market News For Jul 31, 2019

Stocks closed in the red on Tuesday after Trump’s renewed attacks on China diminished investor’s hopes of a positive outcome from trade talks. This weighed on tech and consumer discretionary players, while investors remained focused on the ongoing Fed meeting.

The Dow Jones Industrial Average closed 0.1% or 23.33 points lower, at 27.198.02. The S&P 500 lost 0.3% to close at 3,013.18. The Nasdaq Composite Index finished at 8,273.61, losing 0.2%. The fear-gauge CBOE Volatility Index (VIX) increased 8.6% to close at 13.94. Advancers outnumbered decliners on the NYSE by a 1.26-to-1 ratio. On Nasdaq, a 1.64-to-1 ratio favored advancers issues.

Trump Attacks China, Market Dampened

The United States and China agreed to restart trade talks late in June after discussions broke down in May. A team of delegates that include U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer flew into Shanghai on Monday to negotiate the terms of the deal.

However, President Donald Trump’s tweets on Tuesday adversely affected the indexes. Trump accused China of reneging on its promise to buy more U.S. agricultural products. Officials from China opposed the statement, claiming that it has purchased an additional amount of such goods.

The United States had earlier broken off trade talks in May, complaining that China had refused to incorporate clauses guaranteeing intellectual property rights. China on the other end wants the deal to include removal of all U.S. tariffs imposed till date. Further, it has demanded that restrictions on Huawei’s operations in America be done away with.

Further, Trump pressurized China to sign the trade deal immediately, pointing toward consequences that will lead to tougher terms if he is re-elected next year. This dispute between the world’s two largest economies has impacted Wall Street for long now. The impact of Trump’s tweet was quite evident on tech stocks. Shares of Apple Inc. (NASDAQ:AAPL) slipped 0.4% and pulled down the tech sector.

Fed Rate Cut On the Anvil

Traders waited eagerly for the Fed to deliver its monetary policy decision on Wednesday at 2 p.m. Traders are widely expecting a quarter-point rate cut. Investors are also looking for clues from Fed Chairman Powell’s statement about the course of monetary policy over the next half of the year.

Data from U.S. Commerce Department highlighted that spending capability of American consumers have increased and a Fed’ rate cut can benefit businesses. This will positively impact economic growth.

Mixed Earnings Kept Indexes Moving

Nearly half of the S&P 500 companies have declared second-quarter earnings till now, of which 75.9% have beaten expectations.

Procter & Gamble Co’s (NYSE:PG) shares jumped 3.8% after it released a better-than-expected fourth-quarter fiscal 2019 earnings report of $1.10 per share beating the Zacks Consensus Estimate of $1.06 per share. The earnings got a boost from 3% rise in shipment volumes and a hike in organic sales which grew 3% from pricing and 2% from favorable mix.

Merck & Co, Inc (NYSE:MRK) reported a higher than expected earnings of $1.30 per share leaving the Zacks Consensus Estimate of $1.16. The revenues were up by 13% compared to last year banking on higher sales in oncology and vaccines. Merck shares rose by 0.9%

But, GrubHub Inc. (NYSE:GRUB) , the online food ordering giant posted a disappointed Q2 earnings $0.27 per share that missed the Zacks Consensus Estimate of $0.30 per share. The company claims to have faced high competition that resulted in the poor profit performance. GrubHub’s shares tanked 12.3%

Procter & Gamble, Merck and GrubHub carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 RanK (Strong Buy) stocks here.

Stock That Made Headline

C.H. Robinson Q2 Earnings Beat, Revenues Miss Mark

C.H. Robinson Worldwide’s (NASDAQ:CHRW) second-quarter 2019 earnings of $1.22 per share surpassed the Zacks Consensus Estimate by a penny. The bottom line also improved approximately 8% year over year. (Read More)

Hawaiian Holdings Q2 Earnings Beat, Q3 RASM View Dull

Hawaiian Holdings, Inc.’s (NASDAQ:HA) second-quarter 2019 earnings (excluding 2 cents from non-recurring items) of $1.23 per share outpaced the Zacks Consensus Estimate of $1.04. However, the bottom line declined 14.6% year over year. Although quarterly revenues of $712.2 million surpassed the Zacks Consensus Estimate of $707.5 million, it dipped marginally year over year. (Read More)

Verisk (VRSK) Q2 Earnings Miss Estimates, Revenues Beat

Verisk Analytics (NASDAQ:VRSK) reported mixed second-quarter 2019 results, wherein the company’s earnings lagged the Zacks Consensus Estimate but revenues surpassed the same. (Read More)

More Stock News: This Is Bigger than the iPhone!

It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.

Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.

Click here for the 6 trades >>