Qualcomm Caps Week Of Mega Mergers. RBC Shares Do A 180

Qualcomm Caps Week Of Mega Mergers. RBC Shares Do A 180

CMC Markets  | Oct 28, 2016 11:08

The ongoing jump in government bond yields is becoming a discomforting force in stock markets where investors are contending with one of the busiest few days of the quarter for corporate earnings.

The FTSE 100 dropped by half a percent by mid-morning. Oil companies BP (LON:BP) and Shell (LON:RDSa) have been the biggest drag after a poorly-received update from France’s Total. Airlines and healthcare shares offered UK blue chips some reprieve in a positive read-across from a rise in IAG (LON:ICAG) and Sanofi (PA:SASY) shares after quarterly results. It was a more mixed showing for bank shares after a slew of earnings reports from the likes of RBS, UBS and BNP Paribas (PA:BNPP).

It was a rollercoaster reaction in the shares of Royal Bank of Scotland (LON:RBS) to the bank’s results. Initial gains of 5% gave way to losses of over 1%. Some investors will have taken the earnings bounce as an opportunity to offload holdings. RBS shares approached post-Brexit highs reached in September before the retracement. The underlying bank is looking a lot sounder but a never-ending trail of legacy fines and the low rates environment mean it’ll probably be a number of years before RBS is not a tax-payer backed bank.

Shares of International Consolidated Airlines rose 3% on Friday in a warm response to its earnings update despite a profit warning. Chief Willie Walsh underlined the trouble the airline industry faces from the fall in the pound, air traffic control strikes and terrorism. Despite the profit warning, full-year earnings are still expected to grow year-over-year, and a new agreement reached this week on its pensions will limit the effect of contributions on the bottom line.

Cost-cutting and higher production helped French oil major Total beat earnings estimates. A 25% decline in profits compared to the same period last year shows the integrated oil firms are far from out of the woods, despite oil prices doubling from the lows this year. Total’s results set the scene for earnings next week from BP and Royal Dutch Shell, both of whom have been restructuring to deal with the lower price of oil.

Weak global sentiment is setting US stocks up for a lower start following overnight results from tech giants Amazon (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL) and another mega merger, this time with Qualcomm (NASDAQ:QCOM) to buy NXP.

While Apple (NASDAQ:AAPL) is apparently pulling back from its “iCar” plans, Qualcomm is making a $39 billion dollar bet on the world’s largest developer of chips for automobiles. Smartphone sales, where Qualcomm sells a lot chips, are reaching a plateau. The smartphone-ification of automobiles is in its infancy.

USA pre-opening levels

S&P 500: 3 points lower at 2,130

Dow Jones: 3 points lower at 18,166

Nasdaq 100: 25 points lower at 4,811

"DISCLAIMER: CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.

No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. "

Original post

CMC Markets

Related Articles

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (India) English (Canada) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+

Download the Investing.com App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.

Investing.com is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.

';