Marketbites: Apple Revenue Hurt By Strong Dollar
Portfolio Manager Commentary:
Major indices were all over the place on Thursday. The Nasdaq continued to get crushed by disappointing tech earnings sending the index down 1.63% on the day. The S&P 500 similarly decreased 0.61%. Meta and Align Technologies led the fall for these indices after they missed expectations and sank 25% and 18%, respectively. The Dow Jones index performed better, rising 0.61%, following a strong earnings report from Caterpillar that moved the stock up 8%.
More earnings from heavyweights like Amazon and Apple came out yesterday. Amazon saw its stock plummet 20% after-hours due to a significant decrease in its 4th quarter sales outlook. Apple was able to beat earnings expectations, but came up short on iPhone sales and services. Apple CEO Tim Cook told CNBC that sales revenue would have grown “double-digits” if not for the strong dollar. Instead, the company saw an 8% revenue increase.
Chart of the Day:
The U.S. economy grew at an annualized rate of 2.6% in the 3rd quarter. Still, there were signs of economic weakness as consumer and business spending faltered amid both high inflation and high interest rates. As seen below, net exports and a shrinking trade deficit drove third-quarter growth. At the same time, consumers contributed less than they did the previous quarter.