Wall Street finished in a mixed order on Thursday, with the Nasdaq composite climbing to new highs thanks to earnings beat from Facebook (+5.8%) and Microsoft (+3.3%). The Dow Jones, however, was penalized by industrial stocks after the conglomerate 3M tumbled 13% on disappointing results and the announcement of the removal of more than 2,000 positions. Investors have also remained cautious after many signs of weakness in the global economy, from South Korea, Spain, Sweden and Japan. On Friday, the markets will be aware of US GDP figures. United in the first quarter of 2019.
At the close the Dow Jones Industrial Average yielded 0.51% at 26,462 points, while the broad S&P 500 Index dropped 0.04% to 2,926 points and the Nasdaq Composite gained 0.21% to finish at 8,118 points, missing just 2 points from the historic record entered Tuesday.
Markets continue to react to corporate earnings, which have been mixed. While Facebook (+5.8%) and Microsoft (+3.3%) surged due to higher than expected earnings, 3M plunged 12.9%. Microsoft’s market capitalization rose above the symbolic threshold of $1 trillion, and surpassed that of Apple (-0.6%).
Facebook reacted positively on the stock market to the financial results of the first quarter, even though the group said to expect a fine of up to $5 billion in the coming months. Revenues came out better than expected in the first quarter, up 26% over one year, to $15.08 billion, exceeding the average estimate of analysts was $14.98 billion. Billings increased thanks to the growth of the Instagram app and a surge in advertising revenue. The number of monthly active users reached 2.38 billion, above the consensus. Net profit, however, declined to $2.43 billion, or 85 cents per share, against $4.99 billion a year earlier, while analysts expected earnings of $1.63 per share.
Microsoft reported profits and sales that exceeded expectations. For the first quarter of 2019 (which is the third fiscal quarter), Microsoft reported a net profit of $8.81 billion, up 18% over the same period of 2018. Earnings per share, adjusted for one-time items, was $1.14 (versus $0.95 in 2018), exceeding Wall Street’s expectations of $1. The revenue of the US computer and internet giant reached $30.57 billion against $26.82 billion a year earlier (+14%), well above the market consensus, which was $29.88 billion.