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Caterpillar and Ford shares rise, eBay plunges as outlook for Q4 disappoints

Yahoo Finance’s Ines Ferre reports on the day's trending tickers.

Video Transcript

JARED BLIKRE: Well, we want to check on the markets here where we have a rally underway on Wall Street. Dow is up 0.5%, S&P 500 up 0.75%, Nasdaq up 1%, the Russell 2000 up 1.75%. And looking inside the NASDAQ 100, I was just noting the action in Amazon and Apple at the end of the prior hour as well as Tesla. Those mega caps are performing nicely today. And if we sort by performance, we can see some of the stocks not doing as well. Here's one that's an earnings story-- eBay, that is down 6.5%. Also O'Reilly Auto Parts, that is down 4.5%.

But looking at the sector action for today we can see consumer discretionary in the lead along with industrials and materials and financials. So the value and cyclical trade is outperforming today and the defensive sector, consumer staples, that is in the rear. That's up about 10 basis points and that's followed by energy and utilities rounding out the laggards here.

And we want to check in on the price of Bitcoin as well. And let's get a market cap view. We can see Bitcoin up almost 4% over the trailing 24 hours, Ethereum up 5%, and some of the big outperformers? Well, they're related to a dog-- Dogecoin up 32%-- and let's check out the two-day price action here-- and also Shibu Inu I should mention as well.

Well, we want to stick with the market action and get to Yahoo Finance's Ines Ferre. And Ines, I know you're watching Caterpillar in particular. That's after beating on their third quarter earnings. What are some of the details here?

INES FERRE: Yeah, that's right, Jared, with Caterpillar right now more than 3%. The company beating its earnings estimates with earnings per share coming in at $2.66. That beat the consensus that Wall Street was expecting. The company said it saw increased demand in the construction industry. Management talked a lot about supply chain impact, saying that supply chain snags were more significant than they expected, they're uncertain if they've seen the worst of the supply chain difficulties, and they're expecting those supply chain impacts to last into 2022.

And CFO Andrew Bonfield during the earnings call said that if supply chain issues continue or worsen that it will be difficult to offset those higher costs with price hikes. As far as sales going into Q4, the company seeing increased sales in Q4 versus Q3. Also seeing a strong demand going into 2022.

The only real weakness that the company saw was in China, and though China sales are expected to pick up in the second half of 2022. But overall, the Street liking what it's seeing. You can tell by the reaction on the stock.

JARED BLIKRE: Yeah, and another stock that's reacting after its earnings report is Ford-- having its best day since June. So what are some of the details to do with Ford here?

INES FERRE: Yeah, with Ford beating on the top and the bottom line, quite a big beat on that bottom line, also coming in with $0.51 per share adjusted versus $0.27 of what the Street was expecting. Revenue coming in at $33.21 billion. The company boosting its full-year profit guidance reinstating its dividend. It had taken that dividend away in March of 2020. You'll recall that the markets were spiraling down during that month. Companies were preserving cash. Well, it has now reinstated that dividend, so a lot of positives in these results.

Ford is also an investor in Rivian. We know that Rivian, the electric vehicle maker, will be going public. And also as far as the semiconductor shortage, saying that that remains a challenge but that it's improved since the second quarter. A bit of a contrast from what we heard from GM yesterday, expecting that things won't get better until the second half of 2022 when it comes to the chip shortage.

JARED BLIKRE: And Ines, one more earnings story, except this one has the stock sending it to the downside, and that would be eBay, and I think it's the worst performer in the NASDAQ 100, as I was noting earlier today. What's inside the eBay results?

INES FERRE: Yeah, and you're seeing pressure on the stock because eBay's revenue outlook for the current quarter-- for the fourth quarter-- missed what the Street was expecting. EBay is expecting sales to come in anywhere between $2.57 billion and $2.62 billion. The Street was estimating somewhere around $2.65 billion.

And this is concerning because, of course, this is the quarter that includes the holiday season, so that's worrying some investors. In fact, you had a Jefferies analyst who came out and said that this is concerning because eBay, you would presume, would benefit from supply chain issues at retailers. People would presumably be going to eBay to purchase things. EBay's relevance, he says, in a normal environment to consumers, that's concerning. If it isn't great in this kind of environment where we're seeing these supply chain issues at retailers, then perhaps in a normal environment he's questioning how relevant eBay is to consumers as far.

As active buyers are concerned, eBay ended the quarter with 154 million active buyers. That's 5% lower than the same quarter last year. Gross merchandise volume, that declined 10%. EBay saw a boost during 2020, during the pandemic, when people were in lockdowns, when people were at home shopping, but as people have been traveling more, as they've been going out more, they've been spending on dining, that momentum seems to be fading.

And the company has been really trying to divest itself as well, trying to appease activist investors. In June it said that it would sell more than half of e-mart. That's the South Korean marketplace. We know that it's done a similar move when it comes to its classified business, so it's been trying to divest itself, but you're seeing pressure on the stock really because of that outlook for the fourth quarter.