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Morning Movers: Apple Rises, Snap Sinks, Mastercard Gains


The Dow Jones Industrial Average is off slightly this morning as investors wait for the Federal Reserve's decision on monetary policy this afternoon.

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S&P 500 futures have dipped 0.1% at 8:57 a.m. today, while Dow Jones Industrial Average futures have declined 49 points, or 0.2%. Nasdaq Composite futures have ticked up 0.1%.

Yes, Apple (AAPL) is the biggie in a day full of earnings, but it's the Fed that will have everyone's attention. It's not that anyone really expects the Fed to do anything --as Barron's Matthew C. Klein explains, the Fed prefers to raise rates at meetings with press conferences --but that doesn't mean investors won't be watching for hints of what's to come. "We are seeing a cautious start as investors await the end of the Federal Reserve meeting, which is seen as a key indicator for monetary policy," writes Tigress Financial Partners' Jean Ergas.

And perhaps deservedly so. The Fed's preferred inflation metric--core PCE-- hit 1.9% in March. That's three quarters earlier than the Fed's projection, writes Morgan Stanley economist Ellen Zentner. She doesn't expect the Fed to react yet, and in fact expects it to have "tolerance" for above-target inflation. "...having persistently undershot the Fed's 2% goal, policymakers should resist the urge to push back against this nascent return to goal lest you stamp out strengthening in the underlying trend," she explains.

And no one wants that to happen.

Earnings & News

• It's a good day for...oil and gas drillers.

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Chesapeake Energy  (CHK) is up 4% to $3.10 after reporting first-quarter earnings. The energy firm earned 34 cents a share on revenue of $1.24 billion. Analysts were looking for earnings of 27 cents a share on revenue of $1.3 billion. Devon Energy  (DVN), meanwhile, is up 2.2% to $36.99 after reporting first-quarter earnings. The energy firm earned 20 cents a share on revenue of $3.81 billion, while analysts were looking for earnings of 21 cents a share on $3.85 billion in revenue. However, it raised its full-year production guidance, to 536 million to 560 million barrels per day. Newfield Exploration  (NFX) is up 1.8% to $30.60 after reporting first-quarter earnings. The exploration and production firm earned 82 cents a share on revenue of $580 million, while analysts were looking for earnings of 74 cents on revenue of $552.56 million.

• It's a bad for...Yum, both here and in China.

Yum Brands  (YUM), which runs KFC and Taco Bell, is down 4.7% to $82.60 after reporting first-quarter earnings. The restaurant chain earned 90 cents a share on revenue of $1.37 billion, while analysts were looking for earnings of 69 cents a share on revenue of $1.08 billion; however the results reflect new revenue recognition accounting standards that may not make them comparable to the consensus. Yum China  (YUMC), which operates in, duh, China, is down 9.9% to $38.25 after reporting first-quarter earnings. The KFC owner earned 53 cents a share on revenue of $22.2 billion. Analysts were looking for 52 cents a share in earnings on revenue of $1.43 billion consensus. Same-store sales rose 3% in the quarter.

• And the winners are...

Apple  (AAPL) is up 4.4% to $176.60 after reporting second-quarter earnings. The tech giant earned $2.73 a share on revenue of $61.7 billion, while analysts were looking for earnings of $2.69 a share on revenue of $61.15 billion. It sold 52.2 million iPhones in the quarter, below the 53 million consensus estimate.

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AmerisourceBergen  (ABC) is up 2.2% to $91.19 after reporting second-quarter earnings.  The drug distributor earned $1.94 a share on revenue of $41.03 billion, while analysts were looking for earnings of $1.83 a share on revenue of $40.56 billion. It reaffirmed guidance for the full year, as it expects to earn between $6.45 and $6.65 a share, compared with the $6.55 consensus estimate.

Clorox  (CLX) is up 1.9% to $119 after reporting third-quarter earnings. The home products maker earned $1.37 a share on revenue of $1.52 billion, while analysts were looking for earnings of $1.31 a share on revenue of $1.51 billion. For the full year, Clorox raised guidance, as it expects to earn between $6.17 and $6.30 a share, compared with the $6.15 per-share consensus.

CVS Health  (CVS) is up 3.4% to $70.30 after reporting first-quarter earnings. The drugstore chain earned $1.48 a share on revenue of $45.69 billion, while analysts were looking for earnings of $1.40 a share on revenue of $45.77 billion. For the full year, it expects to earn between $6.87 to $7.08 a share, compared with the $6.45 per-share consensus.

Juniper Networks  (JNPR) is up 7.7% to $26.65 after reporting first-quarter earnings. The networking equipment firm earned 28 cents a share on revenue of $1.08 billion. Analysts were looking for earnings of 25 cents a share on revenue of $1.05 billion.

Mastercard  (MA) is up 4.1% to $187.63 after reporting first-quarter earnings.  The credit card network giant earned $1.50 a share on revenue of $3.58 billion, while analysts were looking for earnings of $1.24 a share on revenue of $3.26 billion.

• And the losers are...

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Gilead Sciences  (GILD) is down 5.9% to $68.29 after reporting first-quarter earnings. The biotech earned $1.48 a share on revenue of $5.09 billion, while analysts were looking for earnings of $1.67 a share on revenue of $5.4 billion. For the full year, it reaffirmed revenue guidance of $20 billion to $21 billion, compared with the $21.29 billion consensus.

Molson Coors Brewing  (TAP) is down 5.1% to $68 after reporting  first-quarter earnings. The beer maker earned 48 cents a share on revenue of $2.33 billion, while analysts were expecting earnings of 78 cents a share on revenue of $2.45 billion. The company blamed the shortfall on lower royalties, negative global product mix, and new revenue recognition accounting.

Snap  (SNAP) is down 19.5% to $11.37 after reporting first-quarter earnings. The social networking company lost 17 cents a share, in line with analysts' estimates, on revenue of $230.7 million, compared with the $244.57 million consensus. Daily active users grew to 191 million, below the 194 million consensus estimate. It was also hit with several analyst downgrades. - Teresa Rivas

Upgrades & Downgrades

Cummins  (CMI) is down 2.8% to $149 after UBS downgraded it to Sell.

Freeport-McMoRan  (FCX) is up 1.4% to 15.16 after CIBC upgraded it to Sector Outperform.

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Hershey  (HSY) is down 0.7% to $90.70 after Argus downgraded it to Hold.

Skyworks Solutions  (SWKS) is up 2.6% to 93.28 after Robert W. Baird initiated coverage with an Outperform rating.

Ulta Beauty (ULTA) is down 0.7% to 248.90 after Loop Capital downgraded it to Hold. - T.R.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , US Markets
Referenced Symbols: AAPL , CHK , DVN , NFX , YUM


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