European stock markets closed weaker on Thursday on concerns about the region’s inflation outlook and coronavirus numbers. The pan-European Stoxx 600 provisionally closed down 0.5%, with oil and gas stocks falling 1.8%, while most sectors and major bourses sank deep into the red. Automakers were the outliers, rising 0.3%. Royal Mail shares rose 9.7% after the British postal giant announced it will return £400 million ($539.8 million) to shareholders and raised its full-year profit forecast after a strong first half.
The S&P 500 rose in a choppy session after Nvidia, the world’s largest chipmaker by market value, and several retailers reported strong results. Investors also piled into technology stocks as U.S. Treasury yields fell about 2 basis points. The S&P 500 Information Technology sector is up 27% over the past six months, outperforming the broader S&P 500 by more than 10%. Earnings reports from major retailers continued to boost stocks. Macy’s and Kohl’s topped estimates for quarterly earnings and sales earlier in the day, as did their peers that reported earlier in the week.
Hong Kong stocks fell this morning, while other Asia-Pacific markets mostly rose as Wall Street benefited from strong gains overnight. Alibaba disappointed investors, however, as the company missed earnings expectations. Hong Kong-listed Alibaba shares fell more than 9%.
Alibaba shares fall 11% as company cuts forecasts, profits slump as China cools
Alibaba on Thursday missed revenue and profit expectations for the September quarter as slowing economic growth in China weighed on results, adding to regulatory headwinds. The company also lowered its revenue forecast for the current fiscal year. Previously, it expected revenue of 930 billion yuan, which would have represented 29.5% year-on-year growth. Now the company expects year-on-year growth of 20% to 23%. Alibaba’s core retail business grew 31% year-on-year to 171.17 billion yuan, falling short of expectations. Revenue from customer management, or CMR, is the largest part of Alibaba’s revenue. CMR is revenue that Alibaba earns from services such as marketing that it offers to merchants on its Taobao and Tmall e-commerce platforms. CMR grew only 3% yearover year.
Macy’s shares rise on upbeat results and decision to hire AlixPartners to review the business
Macy’s on Thursday reported third-quarter earnings and revenue that beat analysts’ expectations. That prompted the department store chain to raise its full-year forecast ahead of the holidays. Macy’s reported net income of $239 million, or 76 cents per share, compared with a loss of $91 million, or 29 cents per share, in the year-ago quarter. Excluding one-time items, the company earned $1.23 a share, far better than the 31 cents analysts had predicted. Revenue rose to $5.4 billion from $3.99 billion a year earlier. That beat estimates of $5.2 billion. Macy’s reported comparable sales growth (owned and licensed stores) of 35.6% for the quarter. Analysts had expected growth of 29.3%, according to Refinitiv estimates.