Summary:
- US500 begins new week near 6-month high
- Blackrock and Bank of America report
- Tesla falls on Musk tweets
It’s been a fairly subdued start to the new week as far as stocks are concerned with the US500 pulling back a little after earlier just about edging up to its highest level in 6 months. Friday’s close above 2797 could be seen as a significant in that it was the highest close since February and until the markets ends back below this level on a daily basis then the breakout remains in tact.
The US500 ended last week at a 6-month high and could be set or further gains if it can gain traction above 2797. Source: xStation
Turning our attention to individual shares Blackrock, Bank of America and Tesla are all in focus with the first two announcing their latest trading update while the latter has seen another controversial development surrounding its CEO.
Blackrock
The largest asset manager in the world has reported second-quarter earnings and revenue that surpass analyst expectations but a slowdown in inflows amid market uncertainty could be seen as a a warning sign. EPS came in at at $6.66 vs $6.55 and revenue also beat with the $3.61b just above the $3.59b forecast with both metrics pleasing investors. However, assets under management fell to $6.29t from $6.37t previously in what may be seen as a worrying development.
Shares in Blackrock opened lower but they have gained since the bell. The long term chart resembles that of many financials at present with price revisiting the prior breakout level, in this case around 4.85. Source: xStation
Bank of America
Strong growth in net income across its business divisions were seen in Q2 with the stock making decent gains since the opening bell. Revenue and net income were £22.6b and $6.8b (EPS $0.63) marking a 1% decline and and increase of 33% respectively. The Street was expecting revenue of $22b and $5.9b in net income. A softer than last year’s revenue number and a declining net interest margin are two negatives but on the whole the market seems to like the results with shares higher by more than 2% on the day so far.
The stock has gained to trade near recent highs and not far from a falling trendline going back to earlier this year. Source xStation
Tesla
While the firm didn’t post its latest trading update, there has been some sizable moves in early trade with the stock coming under pressure after reports that a British diver is mulling legal action over the firm’s CEO who called him a “pedo guy” in a tweet. Mr. Unsworth was one of the divers who helped to save 12 Thai boys and their soccer coach and he took aim at Tesla founder Musk who suggested using a purpose built submarine from the firm as a “PR stunt.” Should legal action arise following this it is unlikely to be of a sufficient scale to really hurt Tesla financially, but it represents another incident where the eccentric Musk has drawn unwanted attention on the firm. The stock is one of the most heavily shorted in the US and remains below its 200 day SMA.
Tesla has fallen lower today and the stock remains below its 200 day SMA and around the middle of its recent range. Source: xStation