Customers are walking out of an Apple Store after shopping in Shanghai, China, on July 19, 2023.
Costfoto | Nurphoto | Getty Images
This report is from today’s CNBC Daily Open, our new, international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
Apple’s revenue falls from a year ago
Apple beat Wall Street expectations for both earnings and sales in its fiscal third quarter. However, overall sales fell 1% year over year to $81.8 billion, with iPhone, iPad and Mac revenue all dropping. Apple doesn’t give guidance for upcoming quarters, but the company’s CFO indicated revenue for the September quarter might drop 1% as well. Shares dipped about 2% in extended trading.
Blowout profits for Amazon
Amazon shares rocketed almost 10% in extended trading after it reported earnings and gave a third-quarter forecast higher than expectations. Second-quarter revenue rose nearly 11% from a year earlier to $134.4 billion and net income was $6.7 billion — beating the earnings per share estimate by almost two times — compared with a loss of $2 billion a year earlier.
Markets under pressure
U.S. stocks fell for a second straight day as Treasury yields popped, with the 10-year Treasury yield trading around 4.18%, its highest since November 2022. Europe’s regional Stoxx 600 index lost 0.63% as traders digested the Bank of England’s hike and data showing a downturn in euro zone business activity.
Another hike from the BoE
The Bank of England raised interest rates by 25 basis points to 5.25%. That’s a 15-year high and the 14th consecutive hike, but the central bank’s Monetary Policy Committee gave no signs it was considering a pause. Instead, the MPC vowed to “ensure that Bank Rate is sufficiently restrictive for sufficiently long to return inflation to the 2% target.”
[PRO] Litecoin halving
Litecoin, sometimes referred to as “digital silver” to bitcoin’s digital gold, experienced halving Wednesday. That means the reward for mining Litecoin was cut in half. Bitcoin itself will undergo halving in May 2024 — here’s what cryptocurrency traders can expect from that event, based on the data behind Litecoin’s halving cycles.
The bottom line
Investors are punishing companies that show any sign of weakness this earnings season.
Qualcomm sank around 8.2% after its adjusted revenue missed expectations. Expedia plunged 16.4% on its revenue and bookings miss. PayPal beat forecasts for both adjusted earnings and revenue, but still slumped 12.3% because of concerns over weaker-than-expected margins and a drop in active accounts.
Even mega-cap Apple, which beat both top- and bottom-line expectations — but reported weakness in its hardware segments — wasn’t spared in extended trading.
Those drastic drops weighed down major indexes. The S&P 500 fell 0.25%, the Dow Jones Industrial Average slid 0.19% and the Nasdaq Composite retreated 0.1%. It’s the second day of losses for those indexes, suggesting investors are starting to reassess whether the recent rally’s sustainable.
Indeed, Wall Street’s “fear gauge” hit its highest level since July. The Cboe Volatility IndexFOLLOW US ON GOOGLE NEWS