Stock Market Today: UPS, First Republic Earnings Drag on Stocks
Dismal guidance from logistics giant UPS and dreary deposit data from regional lender First Republic kept a lid on the major indexes Tuesday.
- (opens in new tab)
- (opens in new tab)
- (opens in new tab)
- Newsletter sign up Newsletter
Stocks opened in negative territory Tuesday, with losses accelerating as the session wore on. In focus today were corporate earnings; specifically, results from logistics giant United Parcel Service (UPS (opens in new tab), -10.0%) and embattled regional bank First Republic (FRC (opens in new tab), -49.4%). Investors also took in the latest economic reports, including concerning consumer confidence data.
Ahead of the open, UPS said first-quarter earnings slumped 28% year-over-year, while revenue was down 6%. Additionally, the company, whose financial results are often seen as a bellwether for the broader economy, said in a press release (opens in new tab) that due to "challenging macro conditions and changes in consumer behavior," its full-year revenue and adjusted operating margin will likely arrive at the low end of guidance.
Elsewhere, quarterly results from First Republic gave a glimpse into just how brutal the regional banking crisis got in March. The financial firm said deposits fell nearly 41% to $104.5 billion in Q1, much more than analysts were expecting. However, the company added that deposit activity has since stabilized, with total deposits of $102.7 billion as of April 21, down just 1.7% from the end of March. FRC added that it is cutting costs by reducing executive compensation, lowering non-essential projects and activities, and laying off around 20% of its workforce.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
On the economic front, the S&P CoreLogic Case-Shiller National Home Price Index (opens in new tab) was up 0.2% from January to February, marking its first gain in seven months. Miami, Tampa and Atlanta saw the biggest annual increases in home prices among the 20 cities surveyed, while Las Vegas, Phoenix and Los Angeles saw the biggest decreases.
Meanwhile, the Conference Board said its consumer confidence index fell to 101.3 in April from 104.0 in March, though consumers' outlook for business conditions and the labor market improved. "While consumers' relatively favorable assessment of the current business environment improved somewhat in April, their expectations fell and remain below the level which often signals a recession looming in the short-term," said Ataman Ozyildirim, senior director of economics at the Conference Board, in a press release (opens in new tab).
Today's price action was "controlled by risk-off investors, who are concerned about future earnings at a time of slowing consumption, sticky inflation, and a stubborn Federal Reserve," says José Torres, senior economist at Interactive Brokers (opens in new tab).
Indeed, the Dow Jones Industrial Average closed down 1.0% at 33,530, the S&P 500 was 1.6% lower at 4,071, and the Nasdaq Composite was off 2.0% at 11,799.
Spotify, KMB among Tuesday's earnings winners
Not all of today's earnings reactions were negative. Music-streaming service Spotify Technology (SPOT (opens in new tab)) said it had 515 million total subscribers in the first quarter, more than analysts were expecting, sending the communication services stock up more than 5%. Consumer staples stock Kimberly-Clark (KMB (opens in new tab), +1.6%) closed higher after the maker of Cottonelle toilet paper and Huggies diapers reported higher-than-expected first-quarter earnings and lifted its full-year guidance. Additionally, fintech stock Fiserv (FISV (opens in new tab), +2.4%) popped after the global payments processor reported top- and bottom-line beats for its Q1 results and increased its outlook for fiscal 2023.
This week's earnings calendar will continue to be a main driver of price action, with blue chip stocks Microsoft (MSFT (opens in new tab)) and Alphabet (GOOGL (opens in new tab)) releasing their results after tonight's close, and Facebook parent Meta Platforms (META (opens in new tab)) set to report tomorrow evening.
With over a decade of experience writing about the stock market, Karee Venema is an investing editor and options expert at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.
-
-
Why You Should Teach Your Kids Investing
Putting money in the stock market is one of the best ways to build wealth in America. That's why it is so important for parents to teach their kids investing.
By Kyle Woodley • Published
-
10 Ways to Prepare Your Home for Summer Weather
Hot summer weather can take a toll on your home if you're not prepared. Follow these tips to make sure you're ready for the season.
By Daniel Bortz • Published
-
Stock Market Today: Stocks Slip as Consumer Sentiment Slides
Concerns about the debt ceiling also weighed on stocks Friday.
By Karee Venema • Published
-
Stock Market Today: Disney Earnings Drag on Dow
An unexpected decline in subscribers weighed on Disney stock Thursday, while notable deposit outflows sent PacWest tumbling.
By Karee Venema • Published
-
Stock Market Today: Stocks Lose Steam After CPI Report
Stocks wavered after the April CPI report supported the case for the Fed to stop raising rates – but not cut them.
By Dan Burrows • Published
-
Stock Market Today: Stocks Churn Ahead of April CPI Report
The major market indexes made modest moves Tuesday as investors awaited debt-ceiling updates and inflation data.
By Karee Venema • Published
-
Stock Market Today: Stocks Choppy With Inflation Data on Deck
The major indexes struggled for direction Monday amid more volatility in regional bank stocks and ahead of this week's key inflation updates.
By Karee Venema • Published
-
Warren Buffett's Berkshire Hathaway Stock Is Taking Off
Berkshire Hathaway stock has been clobbering the broader market since the banking crisis set in.
By Dan Burrows • Published
-
Stock Market Today: Apple Earnings, Bank Stocks Spark Relief Rally
The April jobs report creates uncertainty around the Fed's future policy plans, but it didn't stop the major indexes from soaring Friday.
By Karee Venema • Published
-
Stock Market Today: Stocks Slide as Regional Bank Rout Worsens
The major market indexes closed lower Thursday as chaos in the banking industry continued.
By Karee Venema • Published