Wednesday, October 23, 2024
Today, markets recovered from a significant slump that saw the Dow drop by 620 points earlier in the session. By the day’s end, the Dow was down just 409 points, a decline of 0.96%. The S&P 500 mirrored this trend, finishing down 0.92%, while the Nasdaq faced the steepest decline of all major indices, dropping 1.60%. The small-cap Russell 2000 closed down by 0.79%.
In economic news, reports were mostly subdued. September’s Existing Home Sales matched expectations at 3.84 million seasonally adjusted, annualized units, which is a slight drop from the previous month’s 3.88 million. Additionally, the Fed’s Beige Book indicated little change, with only New York and Chicago showing some improvement.
Tesla Reports Mixed Earnings While ServiceNow Surprises Investors
Tesla’s Q3 Earnings: A Mixed Review
The electric vehicle pioneer, Tesla (TSLA), surpassed earnings expectations with a net income of 72 cents per share, outpacing the Zacks consensus estimate of 58 cents. Nevertheless, revenues totaled $25.2 billion, falling short of the anticipated $25.57 billion. While deliveries stood at 463,000 units—slightly below production levels of 470,000—gross margins exceeded estimates at 19.8%. Tesla also announced plans for new models in the first half of 2025, although these claims may seem ambitious.
ServiceNow Delivers Strong Q3 Performance
ServiceNow (NOW) became a Zacks Rank #2 (Buy) stock after reporting earnings that exceeded expectations by 24 cents at $3.72 per share. Revenue also surpassed forecasts, coming in at $2.79 billion compared to the expected $2.74 billion. The company raised its full-year revenue guidance, reflecting robust growth in its AI-driven business segment. Initial market reactions saw shares dip, but they have begun to recover in after-hours trading.
IBM’s Q3 Results Show Strength Despite Revenue Miss
IBM (IBM) reported earnings that exceeded expectations during this afternoon’s earnings release, continuing its trend of minimal misses over the past five years. Earnings showed resilience, but revenues of $15.0 billion fell short of the $15.19 billion forecast. The segment growth from Red Hat, which increased by 14%, helped support performance, although shares dropped 3% in after-hours trading.
Las Vegas Sands (LVS) showed a notable earnings miss, reporting 44 cents per share compared to the expected 55 cents, a 12% shortfall. Additionally, revenues of $2.68 billion were down 4.3% year-over-year and below the anticipated $2.80 billion. Surprisingly, shares rose by 3% in late trading, likely influenced by a 20-cent dividend increase and an outline for $2 billion in share repurchases, even amidst ongoing challenges with slowing poker revenues. This marks their 12th earnings miss in the past 20 quarters.
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