New Record High Closes for Dow, S&P 500
Another closing bell, another record high for both the Dow and S&P 500 indexes. The Dow gained 220 points in regular trading Wednesday, +0.63%, to a new record close a hair under 35,485. The S&P, while not quite as impressive as the blue-chip index, grew 0.25% on the day, to 4448. The Nasdaq slipped again, but only slightly: -0.16%, while the small-cap Russell 2000 gained +0.49% for Hump Day.
This morning, the Consumer Price Index (CPI) for July was more or less in-line with expectations, and represent a moderation from hotter inflation on the consumer side in recent months. And the Federal Budget Balance for July was a steep drop, though not as steep as some economists were anticipating: -$302 billion versus expectations of -$314 billion for the month.
Two notable Nasdaq stocks have released earnings after the closing bell, with eBay EBAY shares slipping in late trading on an earnings meet of 99 cents per share and revenues of $2.67 billion, which was slightly better than the $2.64 billion expected. Shares initially popped up +2.5% on the release, but have since sunk into negative territory. The company had ben up +35% year to date.
eBay’s Gross Merchandise Value (GMV) fell 7% year over year to $22.1 billion, slightly below consensus estimates, though the company did announce an expansion to its share buyback program to $3 billion. However, lowered guidance on both earnings and sales in Q3 have helped move shares into the red in late trading. The stock had been up +35% year to date.
Audio production manufacturer Sonos Inc. SONO posted a strong positive swing to +12 cents per share, well ahead of the consensus -17 cents, which itself was an improvement from the year-ago quarter’s -24 cents per share. Revenues also beat estimates by a wide margin: $378.7 million outpaced the $320.4 million in the Zacks consensus. Further, full-year revenue guidance was raised to $1.695 billion - $1.71 billion. Our analysts had previously been expecting $1.66 billion.
Sonos is a direct play on the home entertainment market, with high-quality audio capabilities helping bring the cinema experience to the home. The company has missed on earnings three times since its IPO in 2018, but now notches its fifth-straight beat on the bottom line. Its trailing 4-quarter earnings beat average was over 236%. Shares had popped +8% on the news, but have since mellowed to +6.5%.
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