On Monday the Empire State manufacturing survey for December came in slower than expected at 10.9 and the housing market index for December fell four points to 56. Markets fell sharply as investors looked at this data, plus the anticipated Fed rate hike. The Dow Industrials closed 507 points lower.
On Tuesday housing starts for November rose 3.2% to an annualized 1.256 million units. Oil plunged with U.S. crude declining over 7% to $46.24 a barrel, however, the Dow Industrials closed up 82 points.
On Wednesday existing home sales for November rose 1.9% to an annualized 5.32 million units and the EIA petroleum status report for the week ending December 14th saw crude oil inventory decline by 500,000 barrels.
The Federal Reserve concluded their meeting and raised rates, as expected, by .25 point to a range of 2.25 to 2.5%. However, the Fed also signaled they expect fewer rate hikes in 2019 than initially estimated and they also lowered their 2019 GDP forecast by .2% to 2.3%. In addition, the reduction of the Fed balance sheet though bond sales will continue at the same pace. Markets rose early on anticipation of a more dovish Fed, but when expectations weren’t met, markets sold off with the Dow Industrials finishing 351 points lower.
On Thursday jobless claims for the week ending December 15th rose 8,000 to 214,000. Markets continued to drop due to fears of the Fed over-tightening and it also didn’t help when President Trump said he would not sign a temporary funding bill to keep the government open. The Dow Industrials ended the day 464 points lower.
On Friday durable goods orders for November increased .8% compared to the prior month’s 4.3% decline, and the final estimate for the third quarter GDP was revised down .1% to 3.4%. Personal Income for November increased .2% and spending increased .4%, while the PCE price index increased .1%. At the open, markets rose sharply after some dovish comments by New York Federal Reserve President John Williams. Now let’s take a look at some stocks.
Oracle Corporation (NYSE: ORCL) reported its fiscal second-quarter results after market close on Monday with earnings per share of 80 cents on revenue of $9.6 billion. Oracle’s stronger than expected quarter was driven by its Cloud Services and License Support revenue, which increased 3% year over year, offsetting declines in its other segments. The company topped estimates in both earnings and revenue, sending its shares 3% higher at the opening bell on Tuesday.
Micron Technology, Inc. (NASDAQ: MU) reported its fiscal first-quarter results after market close on Tuesday with earnings per share of $2.97 on revenue of $7.91 billion, missing revenue estimates. Micron is seeing weaker demands for its chip throughout the second half of the year. Shares slipped 4.3% on the news.
Tilray, Inc.’s (NASDAQ: TLRY) shares edged higher on Wednesday after the company announced entering into a joint venture with AB InBev to study cannabis-based beverages. The partnership is limited to Canada for now and the two companies will invest $50 million each to study non-alcoholic beverages containing THC and CBD. Tilray shares jumped as much as 19% following the announcement during Wednesday’s after hours.
General Mills Inc. (NYSE: GIS) reported its financial results on Wednesday surpassing earnings expectations with earnings per share of 85 cents on revenue of $4.41 billion. The company’s stronger than expected results were driven by its Blue Buffalo Pet Products acquisition. Shares surged 6.7% on the news.
GlaxoSmithKline plc (NYSE: GSK) and Pfizer Inc. (NYSE: PFE) announced on Wednesday that the two will combine their consumer healthcare business in a multi-billion dollar merger. Glaxo will maintain a 68% equity interest in the combined business. In the future, Glaxo also intends to create two new UK-based global companies focused on pharmaceuticals, vaccines and consumer healthcare. Glaxo shares were trading 5.1% higher after the announcement.