Wall Street trading was volatile on Monday, with the focus being on the start of a new round of trade talks between the US and China.
The blue-chip index Dow Jones Industrial Average wiped out 53.83 points, or 0.21%, to 25,052.50 points. The broader S&P 500 reported a weak growth of 0.07% to 2,709.80 points, as the stock appreciation of companies in the industry sector was overshadowed by losses in healthcare and utilities. The technology benchmark Nasdaq Composited rose by 0.13% to 7,307.90 points.
The markets expect updates on trade and geopolitical issues. Donald Trump’s advisors discussed a meeting between him and Chinese leader Xi Jinping in March at Trump’s private club in Florida.
The US and Chinese diplomats continue with trade talks this week, focusing on intellectual property.
Meanwhile, in China were released new macroeconomic data, which shows that Lunar New Year’s spending has fallen to its lowest level since 2005. Last month, the Chinese government announced that the country’s economy has grown at its slowest pace in 28 years.
The investors are also worried about the potential second interruption of US government work, especially given that the Democrats and Republicans continue to have a different opinion on the country’s border policy.
Corporate stocks performance
Three of the Dow’s biggest losers today were in the healthcare sector, led by UnitedHealth Group, which fell 1.8%, while Pfizer Inc dropped by 1.3% and Merck & Co declined by 1%.
The stocks of Tesla rose by 2.3% after Canaccord Genuity lifted its recommendation on the stock to buy from hold and raised its price target to 450 USD from 330 USD.
Meanwhile, the shares of Boeing neared another all-time high but later fell by 0.18% after analysts at JPMorgan raised the price target on the stock to 450 USD.
The stocks of NuVasive Inc jumped 13.26% following a report that said Smith & Nephew PLC had held talks to buy the maker of medical instruments used in spinal surgery in a deal that would be worth more than 3 billion USD.
FAANG stocks were down on Monday with the only exception of Amazon, which rose slightly by 0.18%. The shares of Facebook wiped out 0.92%, while those of Apple decreased by 0.52% and Netflix dropped by 0.53%.
Corporate earnings reports
The revenue of Restaurant Brands International, which is the parent of Burgen King, Tim Hortons, and Popeyes Louisiana Kitchen, climbed by 12% YoY to 1.385 billion USD in Q4 2018, while the earnings per share rose by 3% to 0.68 USD. Same-store sales matched last month’s preliminary figures. Restaurant Brands International boosted its 2019 dividend target to 2 USD per share, following the rapidly expanded delivery of its chains. Popeyes has delivery in 1,100 locations in the US, nearly half of the chicken chain’s domestic locations. Burger King, meanwhile, has delivery in 3,000 of its more than 7,000 US restaurants and 7,000 of its nearly 18,000 global locations.
MoneyGram International reported a loss of 12.5 million USD in its fourth-quarter earnings statement. The Dallas-based company said it had a loss of 0.19 USD per share. Earnings, adjusted for one-time gains and costs, came to 0.01 USD per share. MoneyGram International reported revenue of 345.8 million USD in the period.
Aurora Cannabis reported fiscal second-quarter earnings that were slightly better than Wall Street estimates and roughly in line with the company’s recent projections. The company’s gross revenue rose by 109% QoQ and 430% YoY to 62 million USD, while the net revenue amounted to 54.178 million USD. However, the company reported a net loss of 237.8 million USD in the same period, against a net profit of 7.7 million USD a year ago. In other words, Aurora lost nearly four dollars for every dollar in revenue it brought in. There are a few reasons for that growing loss, and some of them underscore why, for all its promise, the nascent cannabis industry is not free from the problems many startups face. Aurora is a growing startup: The amount of kilograms Aurora sold last quarter surged 162%, accounting for the growth in its top-line. At the same time, the cost of sales per gram of cannabis the company produced rose 36% last quarter to 1.92 USD.