Dow 30 Stock Roundup: Disney Earnings Impress, Pfizer's Cancer Drug Gets CHMP Nod
Zacks Investment Research | Feb 08, 2019 07:29AM ET
The index endured a mixed week after trade war fears reemerged. Technology stocks were the star performers of the week’s first trading day. Strong earnings numbers also played their part, boosting stocks on Tuesday. But disappointing results from videogame makers and fresh trade war fears led the index to close in the red on the next two trading sessions.
Last Week’s Performance
The index increased 0.3% last Friday after the release of stellar economic data boosted investor sentiment. This also signified that the 35-day partial government shutdown has failed to have much of an impact on the U.S. economy.
Gains for the 30-stock index were buoyed by increase in shares of Chevron Corporation (NYSE:CVX) , Exxon Mobil Corporation (NYSE:XOM) and Merck & Co., Inc. (NYSE:MRK) which gained 3.2%, 3.6% and 2.7%, respectively, after reporting better-than-expected quarterly earnings results.
The index gained 1.3% last week, posting its sixth straight week of gains. This was its longest such streak since November 2017 when it gained for eight straight weeks.
Strong fourth-quarter earnings results boosted investors’ confidence in risky assets like equities. The Fed kept the federal funds target rate unchanged and adopted a dovish monetary stance. Meanwhile, Caterpillar Inc. (NYSE:CAT) posted dismal earnings in the fourth quarter of 2018.
Also, NVIDIA Corporation (NASDAQ:NVDA) lowered quarterly guidance citing China’s economic slowdown, which weighed on the broader markets. Further, Trump stated that he was doubtful that a border-wall funding deal could be reached, reigniting shutdown fears.
The Dow This Week
The index gained 0.2% on Monday buoyed by the strong performance of technology stocks. The FAANG group stocks registered a particularly strong performance. Moreover, solid fourth-quarter earnings results boosted investors’ confidence in risky assets like equities.
The index increased 0.7% on Tuesday supported by strong fourth-quarter 2018 earnings. Moreover, investors waited for President Trump’s State of The Union address to be delivered late in the evening.
The index lost 0.1% on Wednesday following disappointing earnings results from videogame companies. Moreover, investors failed to get any clear cut picture about the government’s future course of action from President Trump’s State of The Union address.
The index declined 0.9% on Thursday after the U.S.-China trade disputes intensified. The broad-based market decline was further aggravated following the European Commission’s lowering of its economic growth projection forecast for of the European Union.
Components Moving the Index
The Walt Disney Company (NYSE:DIS) reported first-quarter fiscal 2019 adjusted earnings of $1.84 per share that comfortably beat the Zacks Consensus Estimate of $1.57. However, the figure declined 2.6% from the year-ago quarter. Disney has a Zacks Rank #3 (Hold).
Revenues of $15.30 billion almost remained flat with the year-ago quarter. The figure surpassed the consensus mark of $15.18 billion. Strong performance of Media Networks and Parks, Experiences & Consumer Products primarily led to top-line growth.
Second-quarter fiscal 2019 operating income will have a negative impact of $200 million due to continued investments in ESPN+ and Disney+. (Read: Zacks Investment Research
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