- European stocks edged lower on Thursday as concerns over China’s property sector returned to the forefront, while investors also watched a string of corporate earnings. The pan-European Stoxx 600 closed just below the flat line, with mining stocks leading the losses, down 3%, on concerns about China’s property sector. Barclays reported a better-than-expected third-quarter profit on Thursday, following its Wall Street peers who got a significant boost from their investment banking division. Shares were down 0.6% by the close.
- The S&P 500 hit a new record high Thursday, ending a two-month slide like the Dow Jones Industrial Average that was sparked by strong year-end earnings and optimism. Tesla contributed to the rise in the S&P 500 after strong earnings from the electric vehicle maker. The S&P 500 staged a comeback this month as booming earnings reports trumped concerns about inflation and a possible end to Federal Reserve bond purchases. The S&P 500 is up 1.75% this week and 5.62% this month.
- Asia-Pacific markets were mostly higher in early morning trading as shares of Hong Kong’s China Evergrande Group surged after media reports that the troubled construction company will make a coupon payment on a dollar-denominated bond. Chinese media reported on Friday that indebted construction firm China Evergrande Group was preparing to pay interest on a bond that was due on which was due on Sept. 23, before the grace period ended on Saturday
Intel shares fall after component shortages PC chip business hit
Intel shares fell more than 8% in extended trading Thursday after a weaker-than-expected revenue report and the company blamed an industry-wide component shortage for causing its PC chip business to shrink 2% in the quarter ended Oct. 2. Intel also warned Thursday that its gross margin and free cash flow would fall to lower levels over the next two to three years as it invests in research and development and builds new chip fabs. Intel said it expected to generate approx. $18.3 billion in adjusted revenue for the fourth quarter, compared with analysts’ expectations of $18.24 billion. Intel’s largest business unit, the Client Computing Group, declined 2% year over year to 9.7 billion dollars.
Snap plunges 22% after missing revenue expectations
Snap shares fell 22% after the company reported its third-quarter results on Thursday. The company’s revenue missed Wall Street expectations after its advertising business was disrupted by privacy changes that Apple implemented earlier this year. Adjusted earnings per share were 17 cents versus 8 cents, while revenue came in at $1.07 billion versus Refinitiv’s forecast of $1.10 billion. Snap CEO Evan Spiegel praised Apple’s consumer-friendly changes on CNBC in February, while warning that they posed a risk to fourth-quarter earnings. On Thursday, however, he said the iPhone’s privacy settings are hurting Snap’s advertising business more than expected.