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Stocks gain as United States heads to vote
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US500 breaks above 200-hour moving average
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PayPal, McKesson and Sysco reported earnings
Big day has arrived! Stock markets advance as US voters decide whether they want another 4 years with Donald Trump as a leader or whether they prefer a change and Joe Biden in the lead. First polling stations opened at 11:00 am GMT and last ones will close at 6:00 am GMT (Wednesday). However, a winner could be called as soon as 1-2 am GMT, once early results from battleground states are announced.
In other news, US factory orders data for September was announced at 3:00 pm GMT. Data came in at 1.1% MoM, marking a small beat over 1% MoM forecast. However, data excluding transportation came in at 0.5% MoM, missing 0.6% forecast. Markets did not experience any major move in the aftermath of the release as attention is focused on US elections.
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US500 continues to recover from recent slump. Index builds onto yesterday's gains today and breaks above the 200-hour moving average and 38.2% retracement of a decline started on October 12. Traders should keep in mind that elections night is likely to be very volatile as markets will react to partial results from battleground states. Back in 2016 markets plunged on news that Trump was going to win but started to recover after the S&P 500 hit limit down. Index is approaching 50% retracement at 3,385 area. Source: xStation5
Company News
PayPal (PYPL.US) released earnings report for Q3 2020 yesterday after the close of the Wall Street session. US payments company had net revenue of $5.46 billion (exp. $5.42 billion) amid payment volume of $246.69 billion. Adjusted EPS came in at $1.07, much higher than $0.61 expected. Company added 15.2 million customer accounts in Q3 2020 with total active customers accounts reaching 361 million. PayPal expects full-year EPS growth of 27-28% while revenue should increase 21-22% given constant FX rates.
McKesson (MCK.US) generated $60.81 billion in revenue in the July-September period (exp. $59.39 billion). Adjusted EPS of $4.80 turned out to be much better than $3.86 expected. The US pharmaceutical segment remains the top contributor with $48.1 billion in revenue (+5% YoY). Company said that it looks unlikely that prescription and patient volumes will recover this year.
Sysco (SYY.US) also beat the earnings forecast for calendar Q3 2020. Company reported adjusted EPS of $0.34 against expected $0.23. Revenue at $11.8 billion was in-line with median forecast. Net income at $364.7 million was higher than $317.4 million expected. However, all of the aforementioned figures were lower year-over-year. Revenue declined 23% YoY while net income dropped 51% YoY.
S&P 500 movers at 3:02 pm GMT. Source: Bloomberg
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