Thursday, December 12, 2024

Stock market indexes had a down day from the start: higher producer prices from November’s PPI report and a notable increase in Weekly Jobless Claims ahead of the open today set the scene. We’re still near all-time highs on the major indexes, so taking a breather with less-than-stellar economic prints seems perfectly reasonable.

Attention will now turn to next week’s Federal Open Market Committee (FOMC) meeting, where on Wednesday afternoon the latest decision on interest rates will be made. The 25 basis-point (bps) cut to a range of 4.25-4.50% is more or less baked in the cake; it will be the tone of the press release and Fed Chair Powell’s press conference following the decision that will help map the way forward in the markets.

The Dow finished down -234 points today, -0.53%. It is now trading down nearly -5% over the past five trading days. The S&P 500 was also down -0.54% for the session, while the Nasdaq — fresh off a new closing high Wednesday — slipped -0.66% on the day. The small-cap Russell 2000 slid -1.38% today; it too is down -2% in the past week.

Late Earnings Reports Favorable-to-Mixed

Costco COST reported fiscal Q1 results after the close Thursday, beating estimates on both top and bottom lines. The discount membership warehouse earned $4.04 per share, outpacing expectations for $3.79 for the quarter, on $62.15 billion, which surpassed the $62.05 billion in the Zacks consensus. Membership fees grew by $1.17 billion following its first rate hike in seven years.

Shares are up marginally on the news, following a strong +50% share price gain year to date. In many ways, this is a typical quarterly report for Costco: the company has not missed on earnings for two full years, but typically outperform by a slim +2% margin or so.

Check out the updated Zacks Earnings Calendar here.

Broadcom AVGO posted fiscal Q4 results after the bell, beating estimates on the bottom line by 3 cents to $1.42 per share on basically in-line revenues which were technically a miss: $14.05 billion versus the $14.06 billion estimate. But semiconductor revenues reached a record-high $30.1 billion, with its AI business gaining +220% year over year. Shares are up +4% in late trading.

RH RH, the former Restoration Hardware, also reported mixed results in its Q3 this afternoon: earnings of $2.48 per share missed the consensus $2.67, while revenues of $812 million in the quarter surpassed the $810.9 million analysts were anticipating. But a big revenue boost in RH’s current-quarter guidance — +18-20% — is sending share up +17% in late trading, adding to the +33% gains RH has made year to date.

Questions or comments about this article and/or author? Click here>>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Costco Wholesale Corporation (COST) : Free Stock Analysis Report

Broadcom Inc. (AVGO) : Free Stock Analysis Report

RH (RH) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research