Jan 31st, 2024 – On Wednesday, Wall Street experienced its most significant decline since September after Big Tech stocks reported earnings. The S&P 500 lost 1.6% . The Nasdaq Composite fell 2.2%, and the Dow fell 0.8%.
FED held rates unchanged.The market was pricing rate cuts to start in March but chairman of FED Powell said that he thinks it would be too soon to start cutting in March, however he also expressed that inflation is heading towards their target and rate cuts will start at some point this year.
One of our portfolio holdings, Novo Nordisk (NVO) (Purchased 1 unit @ $100.88) increased by more than 5% after posting a Q4 earnings report that topped estimates. (Earnings of 71 cents compared to 66 cents expected.) The company announced that the sales increased by 36%, mostly driven by their popular weight loss drugs Wegovy and Ozempic. Company CFO Brad Smith told investors that they are expecting a similar growth in 2024 and they will be working on to meet the growing demand for their weight-loss drugs.
Shares of Alphabet (GOOG) slipped by 7% despite the fact that the company shared earnings that topped the estimates. Alphabet shared sales of $86.31 billion vs $85.33 billion estimated and earnings per share $1.64 vs $1.59 expected. The decrease in share price was mainly driven by revenues that fell short of expectations in their Advertisement business, they shared $65.52 billion revenue compared to $65.94 billion estimated.
Boeing (BA) announced a lower than estimated loss, they reported an adjusted loss per share of 47 cents on revenue of $22.02 compared to a loss of 78 cents per share on $22.1 billion in revenue. The market reacted positively to those results and Boeing share price increased by more than %5. Earlier this month, Boeing’s stock experienced a huge decrease (%25) due to the fuselage panel blowout incident in their 737 Max 9 airplane.
Advanced Micro Devices (AMD) reported fourth-quarter earnings close to what investors expect. The disappointing part was mainly in AMD’s AI chips sales expectations. Even though the company updated their expectations to $3.5 billion from $2 billion, it fell short of what investors expected ($8 billion). Shares slid by 3%.