Thursday, February 6, 2025

We had been on the trajectory for a rather uneventful day, upended temporarily by no real news but that which send market indexes into the red. The Nasdaq and S&P 500 bounced back and finished in the green for the session — +0.51% and +0.36%, respectively — while the Dow lost -0.28% and the small-cap Russell 2000 was down -0.45% at the close.

Thus, it was a pretty flat day overall, as we’ve seen more or less for the past couple weeks. With so many changes coming on a seemingly hourly basis — not only from economic prints and earnings results, but from the White House with its litany of headline generation — market behavior looks to be a bit tame, especially at historically high valuations.
 

Q4 Results Send Stocks in Different Directions: AMZN, SKX, EXPE

The big “Mag 7” company reporting this afternoon is Amazon AMZN, which beat solidly on the bottom line — earnings or $1.86 per share versus estimates of $1.52 — and more tepidly on the top: revenues of $187.8 billion surpassed the $187.28 billion expected. North America sales grew +10% and +9% Internationally; its Retail space (Whole Foods) gained +8% in the quarter.

Amazon’s growth engine, however, is its cloud-based Amazon Web Services (AWS), which grew +19% year over year. Ads gained +18% and Subscriptions were up +10%. Shares are selling the news in the after-market, however, after gaining nearly +9% year to date for the Zacks Rank #2 (Buy)-rated giant.

Check out the updated Zacks Earnings Calendar here.

Skechers SKX stock is plummeting -13% after its Q4 report released after the bell, missing by a solid dime on its bottom line — 64 cents per share versus 74 cents expected — while coming exactly in-line on the top line to $2.21 billion. Next-quarter guidance was much weaker than the Zacks consensus, for both earnings and sales. The company attributed this largely to international tax hikes.

Expedia EXPE shares, on the other hand, are up more than +8% following its Q4 earnings report in today’s late-trading period, beating expectations on earnings — $2.20 per share versus $2.07 anticipated — and revenues — $3.18 billion versus $3.08 billion for the quarter. The company is also bringing back a quarterly dividend of 40 cents per share.
 

What to Expect from the Stock Market Friday

Tomorrow is the big Employment Situation report for January, including wage growth figures and an updated Unemployment Rate. Throughout this week, we’ve continued to see the labor market perform admirably; nowhere has this been more prevalent than in non-farm payroll numbers: the trailing four-month average has been for +191K new jobs filled, whereas the prior four-month average was +144K. Can we expect this level of strength to continue?

In any case, we’ve also seen historically low unemployment of 4.1% for three of the past four months. Will this continue as well? There doesn’t seem to be much in the way of good labor market data for January. That said, +170K jobs are expected to have been filled last month, below the December tally of +256K. 

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