Netflix and Morgan Stanley the latest to report earnings

The S&P 500 finished little changed Wednesday as earnings season kicked into full swing and investors parsed the latest results from companies including Netflix and Morgan Stanley.

The benchmark index inched 0.01 per cent lower to settle at 4,154.52, while the Nasdaq Composite eked out a 0.03 per cent gain to close at 12,157.23. The Dow Jones Industrial Average lost 79.62 points, or 0.23 per cent, to finish at 33,897.01.

While many of the companies reporting in the last day topped analysts’ low-bar estimates, traders found something wrong within the results to send the stocks lower.

A lack of forecasts from the major companies also left investors on edge, with the Federal Reserve set to raise interest rates again in a couple weeks and recession fears swirling.

Netflix shares fell 3.2 per cent. On Tuesday, the streaming giant disappointed investors by pushing back plans to clamp down on password sharing. In its latest quarter, Netflix beat analysts’ expectations on earnings per share. The company also added more subscribers than expected, but fell short of revenue estimates.

Earnings from major banks and institutions wrapped up with Morgan Stanley, gaining 0.7 per cent. Despite strong results, the stock initially traded down as margins for its investment banking, wealth and asset management businesses were weaker than expected.

Investors have been closely monitoring the industry after bank failures last month spurred fears that contagion would spread.

So far this week, trading has been choppy as investors evaluate a rush of earnings. Wall Street this season is on the hunt for signs of weakening demand and conditions likely to put a damper on profitability into the back half of 2023.

Dominant electric vehicle maker Tesla headlines earnings results after the bell – with the car maker announcing that they will cut prices on some Model Y and Model 3 EVs, marking the sixth time it has lowered prices this year. IBMand Las Vegas Sands are also on deck.

Overnight, S&P500 sectors were mixed, with Utilities achieving the highest gains, and Communication Services lagging behind.

Futures

The SPI futures are pointing to a 0.1 per cent fall.

Currency

One Australian dollar at 7:10 AM is buying 67.14 US cents..

Commodities

Iron ore futures are pointing to a 1.4 per cent fall.

Gold lost 0.61 per cent. Silver gained 0.43 per cent. Copper fell 0.38 per cent and oil dropped 2.10 per cent.

Figures around the globe

Across the Atlantic, European markets closed mixed. London’s FTSE lost 0.13 per cent, Frankfurt added 0.08 per cent while Paris closed 0.21 per cent higher.

In Asian markets, Tokyo’s Nikkei lost 0.18 per cent, Hong Kong’s Hang Seng fell 1.37 per cent and China’s Shanghai Composite closed 0.68 per cent lower.

Yesterday, the Australian sharemarket closed 0.07 per cent higher at 7366.

Ex-dividends

OZ Minerals (ASX:OZL) is paying 175 cents fully franked
Plato Inc Max (ASX:PL8) is paying 0.55 cents fully franked
Spheria Emerging Co (ASX:SEC) is paying 2.2 cents fully franked
Wingara AG (ASX:WNR) is paying 0.6 cents fully franked

Dividends payable

Imdex (ASX:IMD)
Lovisa Holdings (ASX:LOV)
Nine Entertainment Co. Holdings (ASX:NEC)
Restaurant Brands NZ (ASX:RBD)
Rio Tinto (ASX:RIO)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
Disclaimer

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