Earnings Results:
AMAZON EARNINGS BLOW PAST FORECASTS; SHARES RISE/CNBC.com w/ wires: "Amazon.com reported quarterly earnings that blew past Wall Street's expectations on Thursday, sending its shares higher in extended-hours trading. After the earnings announcement, the Internet retailer's shares rose 9 percent in trading after the closing bell."
ZYNGA EARNINGS TOP FORECASTS; SHARES RISE/CNBC.com w/ AP: “Zynga reported quarterly earnings and revenue that beat Wall Street's expectations on Thursday, sending its shares higher in extended-hours trading. After the earnings announcement, the company's shares rose 2 percent in trading after the closing bell.”
STARBUCKS PROFIT BEATS THE STREET BUT SHARES FALL/Reuters w/ CNBC.com: “Starbucks reported higher quarterly profit but global sales at established coffee shops fell short of analysts' estimates due to weakness in Europe. Sales from cafes open at least 13 months fell 1 percent in Europe, the Middle East and Africa (EMEA) during the quarter, but were up 8 percent in the Americas and 18 percent in the China/Asia Pacific region.”
Hum’s Market Musings
- Stock futures, Euro dip after-hours following S&P’s 2-notch downgrade of Spain’s credit rating to BBB+
- Rally accelerates during afternoon: Dow ends up 114 points
- Dow just shy of wiping out April losses; S&P 500 closes a fraction of a point below 1,400 – a level it hasn’t seen in 3 weeks
- Dow only 60 points away from closing at a new 4-year high
- Mixed performance from the other Dow averages: Dow Utilities at a 3.5-year high; Dow Transports underperforms, falls 1%
Plus, while Allscripts shareholders are cringing… Amazon.com shareholders are celebrating. Looks like somebody bought shares at $185.22 at 4:27pm. Earnings came out at 4:30pm. By 4:33pm, shares climbed to $215. Stock keeps rising… at 6:40pm… it’s at $224. That’s a 20% move from that after-hours low of $185.22.
The Word on Wall Street Tonight
Board Turns on Chesapeake's CEO/WSJ – Russell Gold: “Chesapeake Energy Corp.'s board of directors moved to cut off a controversial perk it has long granted to CEO Aubrey McClendon and said Thursday that it would review Mr. McClendon's personal financial interactions with firms that have a relationship with the company. A week ago the board learned that entities controlled by Mr. McClendon had arranged for loans of up to $1.4 billion from a private-equity group, EIG Global Energy Partners, while Chesapeake was negotiating to sell EIG hundreds of millions of dollars in corporate assets.”
AMAZON SHOWS BLESSING AND CURSE OF KINDLE/Marketwatch: “Amazon.com Inc. surprised Wall Street with far better-than-expected profits in the first quarter, driven in part by the vague-sounding “better product mix” and booming third party sales. Even though the online commerce giant reported a 35% drop in earnings, Amazon’s results blew past Wall Street estimates, with net income of $130 million, or 28 cents a share, on a 34% jump in revenue to $13.18 billion. Analysts were expecting 6 cents a share, according to the FactSet Research consensus.”
EUROPE’S DEBT WOES WEIGH ON BANK EARNINGS/NY Times - Mark Scott: “European banks can’t shake the region’s debt crisis. On Thursday, Deutsche Bank , the largest bank in Germany, said its profit fell 34 percent to 1.4 billion euros ($1.85 billion) in the first quarter, with the economic malaise depressing trading and investment banking activities. A Spanish rival, Banco Santander , reported that its net profit dropped 24 percent to 1.6 billion euros over the same period, as the bank experienced a sharp rise in troubled loans. Even Barclays of Britain, which bucked the trend by generating a 22 percent increase in its first-quarter pretax profit, adjusted for one-time charges, cautioned that Europe’s economic woes could take a toll on future earnings. Robert E. Diamond Jr., the bank’s chief executive, said on Thursday that it was an “encouraging start to the year,” but added “the environment in which we operate remains unpredictable.”
S&P CUTS SPAIN'S LONG-TERM CREDIT RATING 2 NOTCHES/Reuters: Standard & Poor's on Thursday cut its credit rating on Spain to BBB-plus from A, a two-notch downgrade, citing its expectation the government's budget deficit will deteriorate even more than previously thought due to economic contraction. The ratings agency put a negative outlook on the credit and said it believes the government will also have to provide more financial support for the euro zone nation's banking sector.”
JOBLESS CLAIMS RAISE CONCERNS ABOUT JOB-MARKET RECOVERY/CNBC.com – Patti Domm: “The uptick in weekly jobless claims during April is raising concerns the job market’s progress may be slowing down. Jobless claims were reported at 388,000 Thursday and with revisions, the four-week moving average rose by 6,250 to 381,750, its highest level since the week ending Jan. 7.”
HOWARD TOPS HEDGIE RICH LIST WITH $2.3 BILLION FORTUNE/Reuters – Laurence Fletcher: “Ultra-secretive trader Alan Howard has topped the rankings of wealthiest hedge fund managers in this year's Sunday Times Rich List, after his fund navigated the euro zone debt crisis last year to post bumper profits. Howard, co-founder of Brevan Howard, one of Europe's biggest hedge fund firms, grew his total wealth by 44 percent to 1.4 billion pounds ($2.26 billion), the survey by the British newspaper shows.”
F.T.C.’S HIRING OF PROSECUTOR SIGNALS GRAVITY OF GOOGLE CASE/NY Times – David Streitfeld & Edward Wyatt: “Federal regulators have ramped up their antitrust investigation of Google by hiring a high-powered litigator, sending a strong signal they are prepared to take the Internet giant to court. The Federal Trade Commission is examining Google’s immensely powerful and lucrative search technology, which directs users to hundreds of millions of online and offline destinations every day. The case has the potential to be the biggest showdown between regulators and Silicon Valley since the Microsoft suit 14 years ago."
Economic Data
830a 1Q (REAL) GDP
830a 1Q GDP PRICES
830a 1Q Employment Cost Index
955a Apr Consumer Sentiment
Earnings
Before the bell:
Chevron, Ford, Merck, Procter & Gamble, Sanofi, Total
Tomorrow on CNBC
Another First on CNBC: Alan Mulally, Ford CEO 12:10pm
Edvard Munch's "The Scream" on Power Lunch - live from Sotheby's in New York, ahead of its auction next week where it is expected to fetch $80 million
Guests
Tilman Fertitta, Landrys Restaurants CEO (650a)
Divya Narendra, Sum Zero CEO (700a)
Tyler Winklevoss (700a), Cameron Winklevoss (700a)
Bart Chilton, CFTC Commissioner (700a)
Joe Moeller, Procter & Gamble CFO (705a)
Barry Silbert, Secondmarket CEO (840a)
Jonah Peretti, Buzzfeed Founder (840a)
Simon Shaw, Sothebys Impressionist & Modern Art Head (140p)
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