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Mid-Day Market Update: Friday's Movers, European Banks, Exxon Mobil And More

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European banks are retrenching and aiming to shrink as United States banks are booming. According to The Wall Street Journal, U.S. bank executives are “touting the gloom emanating from their European counterparts as a big opportunity to press their newfound advantage.”

Deutsche Bank’s John Cryan, co-chief executive, on Thursday concluded the first half’s earnings period for big European banks by warning more pain could arise. He specified that “we must shrink our balance sheet,” hinting that the German bank “pull-back” from numerous businesses and countries in order to do so.

Two days ago, Chairman of Barclays warned that big Wall Street firms are “an enormous threat” to Europe’s investment banks. He declared that “they have the scale that we no longer have to be global.” According to the WSJ, U.S. major investment banks, such as JP Morgan Chase, Goldman Sachs, Citigroup, Bank of America and Morgan Stanley on average, have climbed 45 percent in the past five years. While European investment banks, like Deutsche Bank, Credit Suisse, UBS, Barclays and Royal Bank of Scotland were down an average 17 percent in the previous five years.

Exxon Mobil Corporation (NYSE: XOM) reported a revenue fall of 33 percent alongside earnings that were slashed. The world’s biggest oil company announced a six-year low earnings report. Although it had growing refinery numbers, it could not counteract for the declining oil prices. Shares have tumbled nearly 4.8 percent in Friday’s session while the oil giant announced a $500 million buyback plan for the current quarter, down from its $1 billion buyback in the first quarter.

U.S. labor costs have rose in the spring, but at a sluggish rate that is the lowest in the previous three decades; The employment cost index increased just 0.20 percent in the second quarter, according to the Labor Department. This wage growth will play a vital role in the Fed’s decision in raising the short-term interest rates.

The Dow Jones Industrial Index was stagnant, the S&P 500 Index rose 0.21 percent, the NASDAQ Composite increased 0.47 percent, and the US Dollar Index declined 0.45 percent in Friday’s mid-day session.

Winners

Moneygram International Inc (NASDAQ: MGI) soared nearly 30 percent after the money transfer and payment service provider reported earnings. The company had earnings of $0.23 per share versus expected $0.15 per share on sales of $358.80 million versus a projected $346.13 million.

Hutchinson Technology Incorporated (NASDAQ: HTCH) was up 20 percent after the manufacturer beat earnings by $0.05 per share, and met revenue expectations. The company also introduced a new Gemini Shape-Memory Alloy Optical Image Stabilization (SMA OIS) actuator to tier 1 camera module manufacturers.

Natural Grocers by Vitamin Cottage Inc (NYSE: NGVC) was lifted 22 percent after the specialty natural foods retailer reported Q3 profits. The retailer announced earnings of $0.19 a share on sales of $158.65 million; analysts expected earnings of $0.15 a share on sales of $159.31 million.

SkyWest, Inc. (NASDAQ: SKYW) rose 20 percent after the airlines holding company reported Q2 earnings of $0.61 per share on sales of $788.42 million; analysts expected earnings of $0.27 per share and revenues of $771.15.

Avolon Holdings Ltd (NYSE: AVOL) was lifted 18 percent after the aircraft leasing holding company announced that it's considering two unsolicited offers for 100 percent of equity for $30 per share and $31 per share, according to Briefing.com.

Losers

RADA Electronics Industries Ltd (NASDAQ: RADA) dwindled 34 percent after the defense electronics contractor priced a public offering of ~6.91 million of its ordinary shares at $1.23 per share.

Ocwen Financial Corp (NYSE: OCN) was down 31 percent after the financial services holding company missed analyst estimates for Q2. The company reported earnings of $0.08 per share on sales of $463 million; Analysts projected the company to report earnings of $0.20 per share and sales of $463.52 million.

QLogic Corporation (NASDAQ: QLGC) declined 21 percent after the storage networking company missed Q1 profits. The company reported earnings of $0.12 a share on sales of $113.4 million. The company reported earnings of $0.16 per share in the previous quarter.

Solazyme Inc (NASDAQ: SZYM) shot down 19 percent after the renewable oils and bioproducts creator reported a Q2 loss. The company reported a loss of $37.2 million.

 

Related Articles (MGI + XOM)

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