US OPEN: Wall Street opens higher on vaccine hopes and upbeat earnings

 

US indices opened higher today as encouraging results from Moderna Inc’s (MRNA.US) experimental coronavirus vaccine lifted investors’ sentiment. According to results published on Tuesday, Moderna’s vaccine produced antibodies to the coronavirus in all patients tested in an initial safety trial and will move into a phase 3 later this month. Stocks directly tied to an economic reopening rose following the vaccine news. American Airlines (AAL.US), Royal Caribbean Cruise Lines (RCL.US) all added more than 7% each in premarket trading. Also better-than-expected earnings results from Goldman Sachs (GS.US), UnitedHealth (UNH.US), Bank of NY Mellon (BK.US) and US Bancorp (BXS.US) also lifted sentiment. Meantime US reported 67,417 new COVID-19 infections yesterday, setting yet another fresh record for new cases reported in a single day, according to data collected by Johns Hopkins University. Cases in the U.S. keep climbing, averaging about 62,210 new cases per day over the past seven days — more than triple the number just a month ago.

 

On the data front, US mortgage applications in the United States rose 5.1 % in the week ended July 10th, the second consecutive period of increase, as rates fell again to new record lows, data from the Mortgage Bankers Association showed.

Total industrial production in the United States rose 5.4 % from a month earlier in June 2020 after increasing 1.4 % in May, beating market expectations of a 4.3 % growth.

 

 

Goldman Sachs (GS.US) quarterly results came in well above analysts’  expectations. Company posted a net profit some 60% above estimates thanks to its bond and equities trading operations. Goldman reported earnings of $6.26 per share  on revenue of $13.30 billion, the second-highest quarterly revenue it has ever posted while Wall Street expected earnings of $3.9 on revenue of $9.7 billion.
Goldman announced its fixed-income division posted its best quarterly revenue in nine years at $4.24 billion, while equities trading generated $2.94 billion, the highest in 11 years. Group revenue was up 41% from a year earlier. However, earnings were lower because of a $945 million litigation cost.
“Our strong financial performance across our client franchises demonstrates the inherent benefits of our diversified business model,” Chairman and CEO David Solomon said in a release. “The turbulence we have seen in recent months only reinforces our commitment to the strategy we outlined earlier this year to investors. While the economic outlook remains uncertain, I am confident that we will continue to be the firm of choice for clients around the world who are looking to reshape their businesses and rebuild a more resilient economy.”
Goldman Sachs (GS.US) launched today’s session with a bullish price gap. If the current sentiment prevails, the buyers should focus on the resistance at $234.39 per share. However if sellers will manage to regain control, then local support is located at $222.50 per share. Source: xStation5

 

UnitedHealth (UNH.US)  posted quarterly earnings of $7.12 per share, well above analysts' expectations of $5.28. Revenue came in above market estimates. Profit was helped by pandemic-related deferrals of medical care, and the company maintained its prior full-year earnings forecast.

 

Lyft (LYFT.US)— The ridesharing company’s stock  rose 2% after the closing bell. Massachusetts is suing Lyft and Uber (UBER.US) over their classification of drivers as contractors rather than employees, the state’s attorney general announced Tuesday. Uber stock also climbed 2% after the market close.

 

Alphabet (GOOGL.US) –  will aquire  7.7% stake in the digital arm of India’s Reliance Industries for $4.5 billion. The unit’s largest operation is Jio Infocomm, India’s largest mobile carrier.

 

Apple (AAPL.US) – A European Union court sided with Apple, ruling that it did not have to pay $14.8 billion taxes to Ireland. EU antitrust officials had maintained that tax breaks received by Apple had constituted an illegal subsidy.

 

Sirius XM (SIRI.US)— stock advanced 2% in extended trading after company announced a quarterly cash dividend of $0.01331 per share of common stock which will be payable in cash on Aug. 31 to stockholders of record at the close of business on Aug. 7.