On Monday there wasn’t much economic news, however, markets continued rallying as investors liked the generally good earnings reports and economic news from last week. Over the weekend, China reported slightly over 40,000 cases of coronavirus and 908 deaths, leaving the possibility of Chinese supply-line disruptions along with new virus flare-ups.
On Tuesday the NFIB small business optimism index for January rose 1.6 points to 104.3 and the JOLTS job openings report for December fell 5% to 6.423 million openings. Ten-year Treasuries yielded 1.59% and U.S. crude continued climbing to $50 a barrel. Markets rose slightly and the S&P 500 and Nasdaq Composite closed at record highs.
On Wednesday the EIA petroleum status report for the week ending February 7th saw crude oil inventory increase 7.5 million barrels and Fed Chair Jerome Powell testified before Congress stating that the Fed is closely monitoring the coronavirus and its potential economic impact. He also expressed concerns for the ability of the Fed to manage future economic downturns in a low interest rate environment. China reported that the rate of growth of new coronavirus cases appeared to be slowing and markets took off with the Dow Industrials closing up 275 points and all three major indexes closing at record highs.
On Thursday the Consumer Price Index for January rose .1% and jobless claims for the week ending February 8th rose 2,000 to 205,000. China revised the way it counts coronavirus cases and the reported number jumped significantly overnight, raising concerns about the impact to the economy. Markets pulled back modestly with the Dow Industrial closing down 128 points.
On Friday retail sales for January rose .3%, and industrial production for January declined .3%. Markets opened flat on disappointing retail sales and continued concerns over the coronavirus. Now let’s take a look at some stocks.
Shopify (NYSE: SHOP) reported fourth quarter results on Wednesday morning. Gross merchandise volume grew 47% year over year to $20 billion and revenue also grew 47% year over year to $505 billion. Shares of Shopify reached an all-time high of $593.89.
Under Armour, Inc. (NYSE: UAA) announced fourth quarter and full year results on Tuesday. The company reported a fourth quarter net loss of $15 million as total long-term debt decreased 19% to $593 million. For the full year, net income reached $92 million. Under Armour announced a restructuring initiative to rebalance its cost base to improve profitability and cash flow. Shares of Under Armour fell by over $3, post announcement.
Cisco Systems, Inc. (NASDAQ: CSCO) announced second quarter results with net income of $2.9 billion, or $0.68 per share on revenue of $12 billion. For the third quarter, revenue is expected to decline about 2.5% year over year, and earnings per share is expected to come in at about $0.65.
Roku, Inc. (NASDAQ: ROKU) announced fourth quarter and full year results on Thursday. Total net revenue for the year grew 52% to almost $1.13 billion. Platform revenue rose 78% year over year to a total of $741 million, while streaming hours reached a record of 40.3 billion. Roku shares increased over 5% after-hours Thursday, post announcement.
Arista Networks (NYSE: ANET) announced the acquisition of Big Switch Networks, a network monitoring provider. The acquisition will enhance Arista’s cloud networking software. Arista Networks also released fourth quarter and full year results Thursday, sending shares down over 8% after-hours.