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Stock Market News for Aug 07, 2019

Zacks Equity Research

Major indexes closed in the green on Tuesday after China’s central bank stepped in to contain the fall in the Chinese currency. On Monday, stocks had taken a sharp drop after China let its currency fall to its lowest level in a decade. The move came as a precautionary measure after President Trump, on Aug 1, threatened to impose 10% tariffs from Sept 1 against an additional $300 billion of Chinese imports.

The Dow Jones Industrial Average climbed 1.2% to close at 26,029.52 on Aug 6. The broader S&P 500 and tech-laden Nasdaq Composite followed suit, rising 1.3% and 1.4% respectively. The former closed at 2,881.77 while the latter ended the day at 7,833.27. The fear-gauge CBOE Volatility Index (VIX) slumped 18% to close at 20.17. Lastly, advancers outnumbered decliners on the NYSE by a 1.20-to-1 ratio.

China’s Central Bank Sets Yuan’s Official Reference Point

Wall Street gained on Aug 6 after the People’s Bank of China stepped in to set the yuan’s official reference point at a level of 6.9683. The Asian country’s central bank did so to stop the Chinese currency from falling below its 7-to-1 ratio with the greenback.

China allowed yuan’s devaluation in a bid to cushion its domestic economy from losses suffered from the trade war. In particular, this move came after Trump said he would impose 10% tariffs on the rest of China’s imports to U.S., to be applicable from Sept 1.

Q2 Earnings Picture

In the corporate sector, The Walt Disney Company DIS reported quarterly earnings of $1.35 per share, missing the Zacks Consensus Estimate of $1.76. Increased programming costs at ESPN and heavy investments in ESPN+ and upcoming streaming service Disney+ hurt the company’s profitability in its fiscal third-quarter. The media giant’s quarterly revenues of $20.25 billion also missed the Zacks Consensus Estimate by 6.61%. Disney carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Second-quarter earnings continue to come through and the overall picture looks good enough. To be specific, Finance and Consumer Staples sectors have yielded better-than-expected quarterly results. (Read more)

Stocks That Made Headlines

Hertz Global Shares Up on Q2 Earnings & Revenues Beat

Hertz Global Holdings, Inc’s HTZ second-quarter 2019 adjusted earnings (excluding 34 cents from non-recurring items) of 74 cents handsomely surpassed the Zacks Consensus Estimate of 22 cents. (Read more)

Diamondback's Q2 Earnings Miss on Weak Gas Prices

Yesterday, Diamondback Energy, Inc. FANG reported second-quarter results, delivering a comprehensive miss. (Read more)

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