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Omar Venerio
Omar Venerio
Articles (1681) 

Tuesday Morning Market Highlights

S&P 500 reaches 3,000 level, AutoZone reports earnings

Markets jump Tuesday morning

U.S. stocks were in the green at market open onTuesday. The Dow Jones Industrial Average gained more than 550 points, or 2.38%, to 25,047, while the S&P 500 index rose 1.88% to 3,011 and the Nasdaq Composite Index advanced 1.46% to 9,460.

Merck (NYSE:MRK) announced two agreements with other institutions to work toward developing a Covid-19 vaccine and antiviral treatment.

Gainers

• Alliance Data Systems Corp (NYSE:ADS) +15.5%

• Carnival Corp (NYSE:CCL) +12%

• Royal Caribbean Cruises Ltd (NYSE:RCL) +12%

• Southwest Airlines Co (NYSE:LUV) +10.4%

• Ralph Lauren Corp (NYSE:RL) +10.3%

• Coty Inc (NYSE:COTY) +9.6%

• Delta Air Lines Inc (NYSE:DAL) +9.4%

Losers

• Newmont Corporation (NYSE:NEM) -3.7%

• Campbell Soup Co (CPB) -2.6%

• Becton Dickinson and Co (BDX) -1.6%

• Hormel Foods Corp (NYSE:HRL) -1.4%

• Kroger Co (NYSE:KR) -1.7%

• Hershey Co (NYSE:HSY) -0.95%

Global markets

The main European stock markets traded in the green. The UK's FTSE 100 gained 0.89%, France's CAC 40 jumped 1.22%, Germany's Dax advanced 0.83% and Spain's Ibex 35 was up 1.68%.

In Asia, Japan's Nikkei 225 gained 2.55%, India’s BSE Sensex fell 0.21%, Hong Kong's Hang Seng gained 1.88% and China's Shanghai Composite rose 1.01%.

AutoZone releases earnings report

Shares of AutoZone, Inc. (NYSE:AZO) gained more than 2% on Tuesday after the company announced its fiscal third-quarter results. The company posted $14.39 in earnigns per share, beating estimates by 81 cents. Revenue of $2.78 billion was flat year-over-year and beat expectations by $130 million.

For the first three quarters of the fiscal year, the gross profit as a percentage of sales was 53.6%, which is flat when compared to last year. However, the operating expenses rose 200 basis points to 35.9% of sales, primarily explained by $75 million of costs incurred due to Covid-19. Further, the operating profit decreased 10.2% to $491.7 million compared to $547.5 million in the same quarter of 2019.

The company repurchased 156 thousand shares of its common stock for $166.1 million at an average price of $1,064 per share. It has temporarily suspended its share repurchase program.

Steven Cohen (Trades, Portfolio) initiated a new position of 20,141 shares in Autozone. First Eagle Investment (Trades, Portfolio) bought 17,000 shares, Joel Greenblatt (Trades, Portfolio) reduced his holding in the company by 56% to 7,555 shares and Simons' firm cut its position by 75% to 35,500 shares.

Disclosure: The author holds no positions in any stocks mentioned.

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About the author:

Omar Venerio
Omar Venerio is a capital markets, derivatives, corporate finance and financial management professor and Area Head of Finance. He is passionate about the stock market and providing independent fundamental research and hedge fund and insider trading-focused investigation.

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