10 things to watch Friday, July 19
- Can tech stocks and the overall market stabilize to end the week? That’s what to watch after a brutal week for the “Magnificent Seven,” which fell victim to a rotation away from 2024 winners. The S&P 500 and Nasdaq Composite were little unchanged in premarket trading.
- Major IT disruptions hit businesses around the world Friday after a software bug in a Crowdstrike update led to issues with Microsoft’s operating system. CrowdStrike has been clear this is not a hack or cyber incident, but there may be some reputational damage. And that could be positive for Club name Palo Alto Networks. CrowdStrike shares are down more than 10%. Palo Alto is up about 2%.
- Netflix shares are down despite a strong second quarter with revenues and earnings per share topping Wall Street estimates. Net subscriber growth was much better than expected. However, its third-quarter revenue outlook came in a little light. Netflix said its advertising business is scaling faster than its ability to monetize its ad inventory.
- Intuitive Surgical shares jumped after the medical device maker reported a clean earnings beat. A number of research firms including Piper Sandler and JPMorgan upped their price targets on Intuitive, which makes robotic surgical systems.
- PPG Industries lowered its organic sales growth outlook, putting pressure on the stock. The paint and coatings maker is now projecting growth to be flat to up low-single digits, compared with its previous outlook of low single-digit growth.
- Two oil services giants are trading in different directions on earnings. SLB is higher after its revenues and adjusted earnings per share beat expectations. On the other hand, Halliburton is falling after adjusted earnings were in line with expectations and sales missed estimates. SLB has more international exposure.
- American Express‘ quarter looks solid despite the stock moving lower. Revenues were up 9% but a slight miss versus expectations. However, earnings per share were much better than expected. The credit card giant, known for its affluent customer base, also lifted its 2024 earnings outlook.
- Club name Eli Lilly‘s obesity drug secured approval in China, just a few weeks after its main rival in the GLP-1 market, Novo Nordisk, got the greenlight for its weight-loss therapy Wegovy. We upgraded our rating Eli Lilly on Thursday after a steep multiday sell-off in the stock. Shares were higher Friday morning.
- Morgan Stanley upgraded chip designer Arm Holdings to a buy-equivalent rating from equal weight and increased its price target to $190 a share from $107. The upgrade is all about Arm’s opportunity to capitalize on artificial intelligence computing moving to the so-called edge in mobile, autos, PCs and more.
- Barclays downgraded Molson Coors to a sell-equivalent rating, but the firm raised its price target on Club holding Constellation Brands to $295 a share from $287. The CEO of the Modelo and Corona parent, Bill Newlands, appeared on “Mad Money” Thursday highlighting why its beer brands are outperforming the rest of the group.
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