Stocks rallied, but not enough to recover the losses from Thursday’s plunge that saw the Dow briefly turn negative year-to-date. Stocks closed lower this week.
First, the scoreboard:
- Dow: 18,002.74, +162.22, (0.91%)
- S&P 500: 2,105.06, +19.55, (0.94%)
- Nasdaq: 4,996.01, +54.59, (1.10%)
And now, the top stories on Friday:
- The US oil rig count fell for a 21st straight week, although the tumble slowed down again. Data released by oil driller Baker Hughes showed that the number of active oil rigs fell by 24 to 679 this week, the lowest since September 2010. Last week, the rig count fell by 31 to 703. The number of combined oil and gas rigs fell by 22 to 905, the lowest level since June 2009. West Texas Intermediate crude oil climbed to as high as $US59.31 per barrel following the release, after an initial pullback.
- Tesla will soon start selling used cars on its website, according to the Wall Street Journal. “Like other luxury car makers, Tesla offers an extended, 4-year or 50,000-mile limited warranty on its used vehicles,” the Journal reported. On Thursday night, CEO Elon Musk unveiled “Tesla Energy,” described as “a suite of batteries for homes, businesses, and utilities fostering a clean energy ecosystem and helping wean the world off fossil fuels.”
- Shares of Taser International surged by more than 9% to an all-time high of around $US33.23. The stock jumped 6% on Thursday after it reported strong sales in the first quarter, and both revenues and earnings that beat analysts’ forecasts. There was no additional news on the company, but The Fly On The Wall noted that on Friday, the Justice Department announced a $US20 million pilot program for body-worn cameras. Last month, Taser shares rallied by more than 8% after the City of London Police Department announced that it ordered 178 Axon body-worn video cameras in the first quarter.
- Twitter shares fell for a second day, down by up to 3.5% in trading. On Thursday, after its weak first quarter earnings results leaked, the stock was halted and then sank by up to 22% when trading resumed. On Friday, the stock fell to as low as $US37.37 a piece — a three-month low.
- Chevron became the latest energy company to smash earnings expectations. Earnings per diluted share came in at $US1.37 in the quarter, much more than analysts’ estimate of $US0.79, according to Bloomberg. Quarterly profit dropped 43%. The company posted sales of $US32 billion, better than the expectation for $US26.3 billion. In a note Friday, Fundstrat’s Tom Lee highlighted that energy companies have an 11.9% “magnitude of surprise” for first quarter earnings, the most on the S&P 500, which stands at 7.1%.
- UBS says there’s “lacklustre interest” in Apple Watch. In a note, analyst Steven Milunovich lowered his estimates for Apple Watch sales in fiscal year 2016 based on “global search activity.” He is predicting Apple sells 31 million Apple Watches, down from a previous estimate of 41 million.
- The latest ISM Manufacturing print came in below expectations. At 51.5, it was below the forecast of 52.0, and unchanged from 51.5 in March. It also noted that manufacturing employment is contracting at a faster rate, down 1.7% month-over-month. This release followed the PMI print from Markit Economics release earlier, which showed that manufacturing activity slowed to the weakest this year in April. At 54.1, it was slightly below expectations for a reading of 54.2, staying flat from the previous month. A reading above 50 signals growth, below 50, contraction.
- Consumer sentiment continues to be very positive. The University of Michigan’s consumer sentiment index registered at 95.9 in April, which was only a hair below the 96.0 expected by economists.
- Ford, Fiat Chrysler, Toyota, and Nissan all reported growth in April, but all of them missed expectations. The big auto companies sold cars in the US at an annualized rate of around 16.46 million units in April, according to Wards Auto. Autodata, another provider of auto sales estimates, estimated the pace slowed to 16.45 million. This was down from 17.05 million in March, and it was worse than the 16.90 million forecast by analysts.