For investors, the week is still young, but the market’s amazing climb to the top is beginning to slow.
After last week’s record-setting highs, this week certainly feels a little bit lackluster. What has caused the slowdown, and will the market be able to ascend even higher before the end of the week? Several key events are taking place this week, and they’ll ultimately impact the performance of the market from now until Friday.
Will the NASDAQ be able to push higher? The biggest impact on the markets this week will be company earnings reports. Several big companies, including Apple (AAPL, Financial) and McDonald's (MCD, Financial), have already released their financial information, and the results have been hit and miss.
Fast food chain McDonald’s was hit hard earlier this week when it released earnings numbers. According to the information, second-quarter earnings dropped as much as 9% due to refranchising costs and the company’s decision to relocate its headquarters to Chicago. In fact, the earnings dipped below the expectations of Wall Street analysts and ultimately sent the stock tumbling more than 4%. This took a toll on the rest of the market as well.
Meanwhile, Apple proved to be a fighter. Wall Street analysts initially expected the company to be hit hard by declining smartphone sales, but the company still managed to bring in impressive revenue during the second quarter.Many experts believe that Apple’s partnership with SAP is one of the main reasons why the company came out victorious since there was already rumour of the company announcing such a partnership. The computer giant seems to know the secret behind successful partnerships and seems to have done magic with this new venture.
The company’s more affordable iPhone seems to be gaining traction and was responsible for giving Apple a small boost in revenue. The release of its earnings sent the stock climbing over 6%.
Unfortunately, the market has remained stagnant, due to disappointing numbers from other key players, including Twitter (TWTR, Financial) and Coca-Cola (KO, Financial). It is still believed by many that Twitter will ultimately be able to achieve success, thanks to several new sports agreements.
The social network has teamed up with several sports leagues in the past few months to begin streaming live events. Collaborative deals have been negotiated with the NFL and the NHL. If Twitter can attract new users, it may very well be able to turn things around in the coming year.
Those who invest in crude oil companies will have a lot of concerns with the ongoing drop in crude oil prices. It is essential to remember that oil is often an indicator of global growth and demand. When oil remains low, it often gives off the impression that growth has begun to slow. This will undeniably give many people concerns in the weeks ahead and could result in unimpressive earnings from many top brands.
Of course, the week is still young and there are many companies, which will release their earnings before the end of the week. Arris International (ARRS, Financial), AXT Inc. (AXTI, Financial) and Facebook (FB, Financial) are all expected to release earnings shortly. These earning reports and the many that will follow will certainly have a major impact on the markets for the remainder of the week.
As an investor, the performances of your moves will be largely impacted by these companies and their performances over the past three months.
Disclosure: I do not own any shares or any stocks mentioned in this article.
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