Tag Archives: estimates

Goldman misses profit estimates as dealmaking slumps, consumer business hit

Jan 17 (Reuters) – Goldman Sachs Group Inc (GS.N) on Tuesday reported a bigger-than-expected 69% drop in fourth-quarter profit as it struggled with a slump in dealmaking, a drop in asset and wealth management revenue and booked losses at its consumer business.

Wall Street banks are making deep cuts to their workforce and streamlining their operations as dealmaking activity, their major source of revenue, stalls on worries over a weakening global economy and rising interest rates.

Goldman is also curbing its consumer banking ambitions as Chief Executive Officer David Solomon refocuses the bank’s resources on strengthening its core businesses such as investment banking and trading.

Solomon confirmed that the bank was cutting 6% of its headcount, or around 3,200 jobs, and was making changes to the consumer business to navigate an uncertain outlook for 2023.

“We tried to do too much too quickly,” he said about the consumer business such as its direct-to-consumer unit Marcus. “We didn’t execute perfectly on some so we’ve taken a hard look at those, and you make adjustments.”

Goldman reported a net loss of $660 million at its platform solutions unit, which houses transaction banking, credit card and financial technology businesses, as provisions for credit losses grew while the business was expanding.

Full-year net loss for the platform solutions business was $1.67 billion, the bank said, even though net revenue of $1.50 billion for 2022 was 135% above 2021.

Goldman on Tuesday confirmed that it is planning to stop making unsecured consumer loans after it moved Marcus into its asset and wealth management arm. The checking account launch for Marcus has also been postponed.

Goldman’s investment banking fees fell 48% in the latest quarter, while revenue from its asset and wealth management unit dropped 27% due to lower revenue from equity and debt investments.

Solomon said the investment banking outlook could be better in the “back half” of 2023, as people are softening their views on the economic outlook for this year.

Shares were down nearly 7% at $347.66 in midday trade.

Reuters Graphics Reuters Graphics

GROWING COSTS

Wall Street’s biggest banks have stockpiled more rainy-day funds to prepare for a possible recession, while showing caution about forecasting income growth in an uncertain economy and as higher rates increase competition for deposits.

Total operating expenses at Goldman rose 11% to $8.1 billion in the quarter. A source told Reuters last week that the bank would lay off 3,000 employees in an attempt to rein in costs.

Goldman Chief Financial Officer Denis Coleman said severance charges will be adjusted in 2023.

The bank reported a profit of $1.19 billion, or $3.32 per share, for the three months ended Dec. 31, missing the Street estimate of $5.48, according to Refinitiv IBES data.

“Widely expected to be awful, Goldman Sachs’ Q4 results were even more miserable than anticipated,” said Octavio Marenzi, CEO of consultancy Opimas.

“The real problem lies in the fact that operating expenses shot up 11% while revenues tumbled. This strongly suggests more cost cutting and layoffs are going to come,” he added.

Goldman’s trading business was a bright spot as it benefited from heightened market volatility, spurred by the Federal Reserve’s quantitative tightening.

Fixed income, currency and commodities trading revenue was up 44% while revenue from equities trading fell 5%.

Overall net revenue was down 16% at $10.6 billion.

Reporting by Niket Nishant and Noor Zainab Hussain in Bengaluru and Saeed Azhar in New York; Additional reporting by Bansari Mayur Kamdar; Editing by Anil D’Silva and Mark Porter

Our Standards: The Thomson Reuters Trust Principles.

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China reports 3% GDP growth for 2022 as December retail sales, industrial production beat estimates

Chinese officials expect about twice the number of Lunar New Year trips this year as last year since many people can return to their hometowns without any Covid restrictions. Pictured here is the Jinan West Railway Station on Jan. 15, 2023.

Bloomberg | Bloomberg | Getty Images

BEIJING — China reported GDP growth for 2022 that beat expectations as December retail sales came in far better than projected.

GDP grew by 3% in 2022, the National Bureau of Statistics said Tuesday. That was better than the 2.8% forecast in a Reuters’ poll. The GDP growth number did miss the official target of around 5.5% set in March. In 2021, China’s growth had rebounded by 8.4% from just 2.2% growth in 2020.

Fourth-quarter GDP rose by 2.9%, beating expectations from the Reuters’ poll of 1.8% growth.

Retail sales fell by 0.2% for the year. But retail sales in December declined by 1.8% from a year ago, less than the expected 8.6% plunge predicted by a Reuters’ poll.

Within retail sales, those of catering fell by 6.3% in 2022. Sales of apparel, cosmetics and jewelry all declined for the year. Medicine was one of the bright spots, after sales surged by nearly 40% in December from a year ago.

Online retail sales of physical goods rose by 17.2% in December from a year ago, according to CNBC calculations of official data accessed through Wind. Those online sales accounted for 27.2% of total retail sales.

In 2022, the metropolis of Shanghai locked down for about two months in an attempt to control a Covid outbreak. China’s stringent zero-Covid policy restricted travel and business activity across the country.

Authorities abruptly relaxed most controls in early December, amid a surge in local infections. While far more people plan to travel around the upcoming Lunar New Year, analysts expect Chinese consumer sentiment will take a few months to recover.

Industrial production rose by 3.6% in 2022. The figure rose by 1.3% in December, well above the 0.2% predicted by the Reuters’ poll.

Fixed asset investment for 2022 rose by 5.1%, slightly above the 5% expected by Reuters. Infrastructure investment on a year-to-date basis grew faster in December than in November, while investment into manufacturing slowed its growth. Real estate investment fell by 10% in 2022, a steeper drop than recorded for the year through November.

The unemployment rate in cities was 5.5.% as of December, while that of younger people ages 16 to 24 remained far higher at 16.7%.

“The foundation of (the) domestic economic recovery is not solid as the international situation is still complicated and severe while the domestic triple pressure of demand contraction, supply shock and weakening expectations is still looming,” the statistics bureau said in a release.

Read more about China from CNBC Pro

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Tesla reports record quarterly deliveries but misses estimates

  • Rare for Tesla to deliver less than it produces
  • Tesla stock in 2022 had its worst year since going public

Jan 2 (Reuters) – Tesla Inc (TSLA.O) on Monday reported record production and deliveries for fourth-quarter electric vehicles, but it missed Wall Street estimates, burdened by logistics problems, slowing demand, rising interest rates and fears of recession.

The world’s most valuable automaker delivered 405,278 vehicles in the last three months of the year, compared with Wall Street expectations of 431,117 vehicles, according to Refinitiv data.

The company had delivered 308,600 vehicles in the same period a year earlier.

Tesla delivered 388,131 Model 3 compact sedans and Model Y sports utility vehicles (SUVs) compared with 17,147 Model X and Model S luxury cars.

In total, Tesla made 439,701 cars in the fourth quarter.

Reuters Graphics

As logistical bottlenecks persisted – an issue CEO Elon Musk had said in October he was working to resolve – Tesla’s fourth quarter deliveries fell about 34,000 vehicles short of production.

In the third quarter, the company deliveries were about 22,000 units fewer than production.

Delivering fewer cars than it makes has been rare for the automaker, which in previous quarters delivered more or similar numbers to the vehicles produced.

Among other headwinds for Tesla, analysts have cited demand weakness in the world’s top auto market China, as well as stiff competition from legacy automakers such as Ford Motor Co (F.N), General Motors Co (GM.N) and startups such as Rivian Automotive (RIVN.O) and Lucid Group (LCID.O).

Tesla plans to run a reduced production schedule in January at its Shanghai plant, extending the lowered output it began this month into next year, according to a Reuters report, based on a review of an internal schedule.

Tesla’s stock, which did not trade on Monday due to a New Year holiday, fell 65% in 2022, its worst year since going public in 2010. Analysts and retail shareholders feared demand issues stemming from an uncertain economy would dent the company’s target to grow deliveries by 50% annually.

“This was a disappointing delivery number and the bulls will not be happy,” said Wedbush Securities analyst Daniel Ives.

Tesla said in a separate statement that it plans to host its Investor Day on March 1 and livestream the event from its Gigafactory in Texas when it will discuss longterm plans for expansion and capital allocation.

The automaker also hinted at a “generation 3” platform to show its investors on Investor Day. Musk said in October that Tesla was working on a “next-generation vehicle” which will be cheaper and smaller than the Model 3 and Model Y cars.

(This story has been refiled to remove New York dateline)

Reporting by Akash Sriram and Baranjot Kaur in Bengaluru; Additional reporting by Akanksha Khushi; Editing by Sriraj Kalluvila, Matthew Lewis, Howard Goller and Barbara Lewis

Our Standards: The Thomson Reuters Trust Principles.

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Parkinson’s disease afflicts thousands more Americans than previous estimates: new study

Some 90,000 people are diagnosed with Parkinson’s disease (PD) in the United States each year — which is roughly a 50% increase from previous estimated incidence rates, according to a recent 2022 Parkinson’s Foundation-backed study. 

“The soaring numbers of Parkinson’s disease cases will lead to more falls, more hip fractures and more people requiring assisted living,” Dr. Michael S. Okun, director of the Norman Fixel Institute for Neurological Diseases at UF Health in Gainesville, Florida, told Fox News Digital.

He’s also a medical adviser to the Parkinson’s Foundation, a nonprofit group based in Miami, but was not part of the study. 

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The study estimated the prevalence of Parkinson’s in North America by analyzing a large group of diverse populations. 

The research aimed to provide a more accurate estimate than previous studies, which estimated an incidence rate of 40,000-60,000 diagnoses annually.

“The soaring numbers of Parkinson’s disease cases will lead to more falls, more hip fractures and more people requiring assisted living,” said one medical expert.
(iStock)

“Prior estimates were based on a small number of cases from areas that are not representative of the nation as a whole,” according to the Parkinson’s Foundation’s website.

“The previous prevalence study, conducted 40 years ago, extrapolated the 26 people with PD in a rural Mississippi county as a benchmark estimate for PD prevalence in the U.S.”

“Men are more likely to have PD than women and the number of those diagnosed with PD increases with age.”

The site also says, “The new incidence rate is 1.5 times higher, at nearly 90,000 cases annually.”

More Parkinson’s disease statistics

Approximately one million people in the U.S. have Parkinson’s disease. 

More than 10 million people globally are living with the disease, according to the Parkinson’s Foundation.

PD is the second most common neurodegenerative disease in the United States — with Alzheimer’s disease being no. 1. 

The primary risk for PD is age — with its incidence increasing among Americans 65 and older, according to the study.

The primary risk factor for Parkinson’s disease is age — with its incidence increasing among Americans 65 and older, according to a new study. 
(iStock)

“The study confirms that men are more likely to have PD than women and that the number of those diagnosed with PD increases with age, regardless of sex,” according to the Parkinson’s Foundation website.

Parkinson’s is a movement disorder

There are normally neurons, or nerve cells, in the brain that produce a chemical called dopamine, according to the Parkinson’s Foundation’s website.

WARNING FROM LASIK EYE-SURGERY PATIENTS TO FDA: MORE NOTICE OF ‘SIDE EFFECTS’ IS NEEDED

“The most prominent signs and symptoms of Parkinson’s disease occur when nerve cells in the basal ganglia, an area of the brain that controls movement, become impaired and/or die,” per the National Institute of Aging’s website. 

Parkinson’s has four main symptoms — including a tremor, muscle stiffness, slow movements and balance difficulties. 

Parkinson’s has four main symptoms, including a tremor, muscle stiffness, slow movements and balance difficulties — often leading to falls.

One of the earliest signs of PD is a “pill rolling tremor” that “looks like you are trying to roll a pill or another small object between your thumb and index finger,” per the Healthline website.

The new study on Parkinson’s noted that the prevalence of people diagnosed with it differs in certain parts of the country — but that more research is needed to better understand the trend.
(iStock)

As Parkinson’s progresses, a classic sign is a “shuffling gait.”

That’s when a person starts to take smaller steps in a shuffling manner, Healthline added. 

Some areas of US showed ‘higher incidence’ of PD

The prevalence of people diagnosed with PD differs in certain parts of the country, the study noted — but that more research is needed to better understand this trend.

“A clustering of counties with a higher incidence of PD was observed at the juxtaposition of the Midwestern and Southern regions of the United States,” the authors said.

“Parkinson’s rates will continue to increase as the population grows and ages. However, these factors alone cannot explain the rapid rise in cases.”

The study found “higher incidence areas” also in southern California, southeastern Texas, central Pennsylvania, and Florida.

Meanwhile, it found “lower incidence areas” in the “Mountain West region, the western Midwest, and the far Northwest.”

Why is PD more common now?

“Parkinson’s rates will continue to increase as the population grows and ages. However, these factors alone cannot explain the rapid rise in cases,” Okun noted.

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This may explain the higher incidence it found in parts of the country, however, where there is an older population, such as Florida, where many older Americans retire.

The study also noted exposure to environmental toxins may explain an increased incidence of PD in areas such as the Rust Belt states, including Ohio and Pennsylvania, which are known for their heavy industrial materials.

“Scientists have been examining whether pesticides, environmental factors, diet and lifestyle all are contributing to the growing cases” of Parkinson’s disease in the U.S., one physician told Fox News Digital.  
(iStock)

“Scientists have been examining whether pesticides, environmental factors, diet and lifestyle all are contributing to the growing cases, as recently Parkinson’s took over the no. 1 spot for the most rapidly growing neurological disease,” Okun added.

The study also found a surprising protective factor: Heavy smokers appear to have less risk of Parkinson’s.

The study noted that it is limited by its retrospective design, so it was prone to selection bias, miscoding and misclassification — and that more research is needed to better understand if smoking itself leads to a reduced risk.

“It’s time for an Operation Warp Speed for Parkinson’s.”

It also noted the true PD incidence may be higher from 2012 to 2022 due to a decreased prevalence of “alleged” protective factors such as smoking and the increased prevalence of risk factors. 

The economic burdens of PD

Parkinson’s disease costs patients, families and the U. S. government approximately $51.9 billion every year, according to a 2019 study published by The Michael J. Fox Foundation.

Roughly slightly less than half of this economic burden is attributable to direct medical costs, while slightly more than half is related to non-medical costs, such as missed work, lost wages, early and caregiver time. 

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“Economically, these conditions will drive a devastating outcome for the health care system, as Medicare and other payers will not be able to keep up with the billions of dollars in expenses,” Okun told Fox News Digital. 

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“Our rate of spending on Parkinson’s disease research is 10-fold less than what will be required to speed up the trajectory for more effective disease modifying therapies,” he added.

“It’s time for an Operation Warp Speed for Parkinson’s.”

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China estimates 250mn people have caught Covid in 20 days

Chinese officials estimate about 250mn people or 18 per cent of the population were infected with Covid-19 in the first 20 days of December, as Beijing abruptly dismantled restrictions that had contained the disease for almost three years.

The estimates — which include 37mn people who were infected on Tuesday alone, or 2.6 per cent of the population — were revealed by Sun Yang, a deputy director of the Chinese Center for Disease Control and Prevention in a Wednesday health briefing, according to two people familiar with the matter.

Sun said the rate of Covid’s spread in the country was still rising and estimated that more than half of the population in Beijing and Sichuan were already infected, the people briefed on the meeting said.

The explosion in cases follows Beijing’s decision this month to abandon its former “zero-Covid” policy, which kept the virus at bay through mass testing, mandatory quarantine and draconian lockdowns.

Sun’s figures, which were provided in a closed-door meeting, contrast with data put out by the National Health Commission, which reported just 62,592 symptomatic Covid cases over the same period. Last week, China stopped publicly trying to tally the total number of infections after authorities curtailed Covid testing.

The lack of information made public by China on its Covid wave has led Washington and the World Health Organization to push Beijing to be more transparent on case counts, disease severity, hospital admission figures and other health statistics that have been made widely available by other countries.

In the Chinese capital and other cities, the wave of Covid infections has overwhelmed hospitals with an influx of elderly, bedridden patients and left emergency rooms and intensive care units with few available beds.

The NHC’s official account of the Wednesday event provided little detail on what the country’s top health officials discussed.

But in the meeting, Ma Xiaowei, director of the NHC, demanded hospitals sort out their overflowing emergency rooms and move patients into inpatient departments, according to one of the people who participated in the meeting. He also urged midsize and large hospitals to take in more patients with severe symptoms and promised that regulators would not hold them accountable for rising fatality rates.

Meanwhile, the estimates of 250mn Covid cases raise further doubts about the accuracy of how Beijing accounts for deaths from the disease. The country has officially reported only eight deaths since December 1. Top health officials this week said they had narrowed the definition of what constituted a Covid death, in a move that reduced the public death tally.

However, crematoriums in the Chinese capital are struggling to handle a surge of corpses, and bodies were piling up at hospitals visited by the Financial Times in recent days.

Several models, including one part-funded by the Chinese CDC, have forecast that the country could have up to 1mn Covid deaths during its reopening.

The National Health Commission did not immediately respond to a request for comment.

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RSV responsible for 1 in 50 child deaths under age 5, study estimates



CNN
 — 

A new study estimates that 1 in 50 deaths of otherwise healthy children under age 5 around the world is due to a common virus that’s currently surging in the US: respiratory syncytial virus, or RSV. And in high-income countries, 1 in 56 babies who are born on time and are healthy will be hospitalized with RSV in the first year of life, according to the researchers’ estimates.

The virus is known to be especially dangerous for premature and medically fragile babies, but it causes a “substantial burden of disease in infants worldwide,” wrote the authors of the study, published Thursday in the journal Lancet Respiratory Medicine.

Other research has examined the number of children with pre-existing conditions who are hospitalized with RSV, but the new study is one of the first to look at the numbers in otherwise healthy kids.

“This is the lowest-risk baby who is being hospitalized for this, so really, numbers are really much higher than I think some people would have guessed,” said study co-author Dr. Louis Bont, a professor of pediatric infectious diseases at Wilhelmina Children’s Hospital at University Medical Center Utrecht in the Netherlands. Bont is also the founding chairman of the ReSViNET foundation, a nonprofit dedicated to reducing the global burden of RSV infection.

The estimates are based on a study that looked at the number of RSV cases in 9,154 infants born between July 2017 and April 2020 who were followed for the first year of life. The babies received care at health centers across Europe.

About 1 in 1,000 children in the study were put in an intensive care unit to get help breathing from a mechanical ventilator. This care is vital: In parts of the world where there is a lack of hospital care, the risk of death is significant.

“The vast majority of deaths with RSV occur in developing countries,” Bont said. “In the developed world, mortality is really rare, and if it happens, it’s virtually only in those who have severe comorbidities. But in most places in the world, there is no intensive care unit.”

Globally, RSV is the second leading cause of death during the first year of a child’s life, after malaria. Between 100,000 and 200,000 babies die from the virus every year, Bont said.

There are fewer RSV deaths in high-income countries, but the virus still causes substantial morbidity, and even hospitalization can have serious effects, said Dr. Kristina Deeter, chair of pediatrics at the University of Nevada, Reno and a specialty medical officer for pediatric critical care at Pediatrix Medical Group.

“Whether that is just traumatic psychosocial, emotional issues after hospitalization or even having more vulnerable lungs – you can develop asthma later on, for instance, if you’ve had a really severe infection at a young age – it can damage your lungs permanently,” said Deeter, who was not involved in the new study. “It’s still an important virus in our world and something that we really focus on. It’s kind of the bread and butter of a pediatric ICU.”

Health-care providers know that November through March is the traditional “viral season,” and they must plan accordingly for RSV and other respiratory problems.

Dr. Nicholas Holmes, senior vice president and chief operating officer at Rady Children’s Hospital in San Diego, said officials there are always sure to have enough respiratory therapists and physicians to manage the influx of cases.

Even then, at the largest pediatric hospital on the West Coast, officials have had to get creative to keep up with the patient load, Holmes said.

“One thing that we just recently implemented to help is that we have many clinicians who are licensed nurses or therapists, or physicians like myself, who are in nonclinical roles in the organization. So we are engaging those licensed staff back in to help support and bridging that gap to support our nurses, physicians who are in direct line of patient care,” Holmes said.

On Wednesday, Holmes said, through the hospital’s Helping Hands program, he spent an hour and a half in the emergency department rather than doing his usual work. He checked on families and patients, handing out blankets and fruit pops. It gave him a chance to watch for problems and alert nurses if a child was getting sicker and needed medical attention right away.

“This allows the nursing team in the triage area to really focus on the sickest of the sick kids,” Holmes said.

Although there is no specific treatment for RSV in healthy babies, recent developments around vaccines and therapies mean help could be on the way for busy hospitals.

There is only one monoclonal antibody treatment for patients who have pre-existing conditions or who were born prematurely. It’s been available since 1998 and has made a significant difference, Deeter said.

“Once premature babies started to receive that, the numbers drastically dropped,” she said. “It is incredibly rare at this point for us to put a baby on a ventilator for RSV. This tiny, fragile group is so well-protected by those injections; however, we still have thousands of babies coming in who didn’t receive those injections who still need supportive care, and often, they’re managed without a respiratory support system.”

There are things parents of infants can do to prevent RSV, said Dr. Priya Soni, an assistant professor of pediatric infectious diseases at Cedars Sinai Medical Center. They’re the simple behaviors everyone is familiar with from the Covid-19 pandemic: Thoroughly wash your hands, stay home if you’re sick, and keep surfaces clean.

“The virus is a little more hardy on hard surfaces, so really cleaning those surfaces and hand-washing goes a long way with RSV, as well as limiting the child’s exposure to infected respiratory secretions and droplets overall,” said Soni, who wasn’t involved in the new research.

The study’s findings about the number of children who get RSV in the first months of life show how important it will be to have an immunization strategy for pregnant women, she said.

“Whatever we could do to close that gap for those young infants that are within the first six months of life, that may be really really prone to that RSV infection, will help,” Soni said.

In the US, four RSV vaccines may be nearing review by the FDA. Globally, more than a dozen are going through trials. A preventive treatment for lower respiratory tract infections caused by RSV got the go-ahead from the European Commission last week.

These developments can be game-changers, experts say.

“Every pediatrician that I know has always been working very, very hard during Christmastime. We are always swamped with RSV patients every year,” Bont said. “This or next year could be the last time that we actually see that, because it could really prevent the bulk of severe infection.”

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Car production estimates for Europe cut dramatically

European car production estimates have been cut dramatically as the energy crisis rages on.

According to a report published by S&P Global Mobility and reported by Reuters, European car production could be down as much as 40% in Q4 as the energy crisis continues on the continent. The report points to dramatic increases in energy costs and energy rationing that may be necessary for the coming winter months.

According to S&P Global Mobility’s report, they typically expect Q4 car production in Europe to total between 4 and 4.5 million units. However, they now believe that number could be as low as 2.75 million. While the report didn’t specify how power rationing specifically affects production, S&P notes that European manufacturers already face as much as a 773 euro per car increased cost due to the crisis.

The most affected automakers will be those with most of their manufacturing on the continent, including BMW Group, Volkswagen Group, Renault Group, and Stellantis. Perhaps even more severely affected could be those brands that already produce in limited production numbers; Ferrari, Lamborghini, McLaren, or Aston Martin, to name a few examples.

More global brands will be able to shift production to keep up with demand, especially those not primarily based out of Europe; however, even these manufacturers may be influenced by dramatically lower consumer demand within Europe.

Automakers have yet to comment on shifting production out of Europe. With numerous earnings calls coming within the coming weeks, expect automakers to address how they will navigate a possible continuing supply shortage.

In legislation, the EU has made it clear that its current focus is protecting citizens from heightened energy costs. Legislation recently passed focuses on subsidizing consumer electricity, capping energy prices, and encouraging energy use reduction. It remains unclear how the EU will address manufacturers, businesses, and maintaining employment during such tumultuous times.

What do you think of the article? Do you have any comments, questions, or concerns? Shoot me an email at william@teslarati.com. You can also reach me on Twitter @WilliamWritin. If you have news tips, email us at tips@teslarati.com!

Car production estimates for Europe cut dramatically








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Asia stocks fall after Wall Street slump; China PMI beats estimates

Japan movers: Softbank, Nintendo, Toyota fall

Apple suppliers in Asia fall after analyst downgrade

China reports better-than-expected factory activity for September

China’s official manufacturing Purchasing Managers’ Index surprisingly grew in September to 50.1, much higher than the 49.6 predicted by analysts in a Reuters poll.

The 50-point mark separates growth from contraction. PMI prints compare activity from month to month.

Meanwhile, the Caixin/S&P Global manufacturing Purchasing Managers’ Index, a private survey of factory activity reported a contraction with a reading of 48.1.

“Subdued demand conditions and lower production requirements led firms to cut back on their purchasing activity in September, with the rate of decline the quickest in four months,” the Caixin press release said.

The official non-manufacturing PMI came in at 50.6 in September, down from 52.6 in August.

— Abigail Ng

Factory activity in China expected to contract again

China’s official manufacturing Purchasing Managers’ Index for September is expected to come in below the 50-point mark separating growth from contraction, according to a Reuters poll of analysts.

Economists expect a figure of 49.6, slightly higher than August’s 49.4, which would mark the third consecutive month of contraction.

PMI readings are sequential and represent month-on-month expansion or contraction.

A private survey of Chinese factory activity is also due on Friday, and analysts polled by Reuters predict that the print will come in at 49.5.

— Abigail Ng

Japan’s industrial production rises more than expected

CNBC Pro: Is the Fed on the right track? Wall Street veteran Ed Yardeni says this is what it should do next

The U.S Federal Reserve announced yet another 75 basis point hike earlier this month, sending the federal funds rate up to a range of 3% to 3.25%. The central bank also signaled it may raise interest rates up to as high as 4.6% in 2023 to control inflation.

Ed Yardeni, the economist who coined the term “bond vigilantes,” gives his take as the Fed’s response to inflation comes under intense scrutiny.

Pro subscribers can read more here.

— Zavier Ong

Fed’s Loretta Mester says interest rates are not yet restrictive

Cleveland Federal Reserve President Loretta Mester said interest rates are not yet restrictive, and there’s more to be done to bring down inflation.

“Inflation is still at a 40 year high,” Mester told CNBC’s Steve Liesman during an appearance on “Squawk Box.” “So right now the conversation has to be we have to do, what we must do to get back to price stability, because we can’t have a healthy economy, we can’t have good labor markets over time, unless we get back to price stability.”

Mester said she’s probably “a little bit above the median path” among Fed officials when it comes raising interest rates, citing the persistence in inflation.

“We’re still not even in restrictive territory on the funds rate, so you’re right, we’ve moved the funds rate up 300 basis points this year, but look how high inflation is,” Mester said.

— Sarah Min

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Zscaler Stock Pops As Zscaler Earnings Top Estimates On Cloud Cybersecurity Growth

Zscaler (ZS) soared Friday after the company reported fiscal fourth-quarter earnings, revenue and billings that handily beat Wall Street targets. And the company’s fiscal 2023 outlook for Zscaler stock came in above views.




X



ZS stock catapulted 21.9% to close at 188 on the stock market today. The cybersecurity firm reported July quarter earnings after the market close on Thursday.

“Zscaler was the last (cybersecurity) company to report results this earnings cycle, and clearly stood out as having the best results and the strongest guidance,” said Wells Fargo analyst Andrew Nowinski in a report.

He added: “The strong performance was largely a function of the fact that the company was purpose-built for exactly this type of macro environment, where budgets are tightening and companies are looking for ways to lower costs. Zscaler can eliminate many point products and simplify the cyber infrastructure, all while lowering costs for the customer.”

ZS Stock: Earnings, Revenue Beat Views

Prior to the Zscaler earnings release, the cybersecurity stock had retreated 54% in 2022.

The San Jose, Calif-based firm said earnings were 25 cents a share on an adjusted basis, up 78% from 14 cents a year earlier. In the July quarter, revenue rose 61% to $318.1 million, the company said.

Analysts expected Zscaler earnings of 21 cents per share on sales of $305.4 million. Also, billings rose 57% to $520.4 million, compared with estimates for $467.2 million.

For fiscal 2023, which starts with the October quarter, Zscaler said it expects earnings of $1.17 a share at the midpoint of its outlook, ahead of estimates for $1.04 a share.

Zscaler said it expects revenue in a range of $1.49 billion to $1.50 billion. Analysts had predicted revenue of $1.468 billion.

Zscaler Stock: Billings Forecast Tops Estimates

The company forecast fiscal 2023 billings of $1.93 billion, compared with estimates of $1.859 billion.

“Despite the uncertain macroeconomic landscape which continues to evolve, we continue to see favorable demand for our Zero Trust Exchange platform because it makes businesses more secure, simplifies IT, and reduces cost,” Chief Executive Jay Chaudhry said in the company’s earnings release.


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Heading into the Zscaler earnings report, the company owned a Relative Strength Rating of 17 out of a best-possible 99, according to IBD Stock Checkup.

In addition, Zscaler provides cloud-based cybersecurity services via 150 data centers worldwide

Zscaler’s web security gateways inspect customers’ data traffic for malware. The Zscaler Private Access, or ZPA cloud service, replaces virtual private networks, or VPNs, to support remote work.

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns for issues such as Zscaler stock is one key to the investment guidelines.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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DOCU Stock Pops as DocuSign Earnings Fall But Top Estimates Amid Lowered Expectations

DocuSign (DOCU) reported July-quarter earnings and revenue that topped estimates amid lowered expectations. The company’s outlook came in mixed, but DOCU stock surged on the news Friday.




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The San Francisco-based software maker reported earnings after the market close on Thursday. DocuSign earnings for its fiscal second quarter came in at 44 cents a share, down 6% from a year earlier, but ahead of estimates for 42 cents.

In addition, the maker of electronic signature software said revenue rose 22% to $622.2 million. Analysts had predicted revenue of $602 million. A year earlier, DocuSign earnings were 47 cents a share on sales of $512 million.

Billings, a sales growth metric, rose 9% to $647.7 million vs. estimates of $601.8 million.

DOCU stock popped 10.5% to close at 64.04 on the stock market today.

DOCU Stock: More In-Person Meetings Hit Business

For the current quarter ending in October, DocuSign forecast revenue of $626 million at the midpoint of its outlook and billings of $589 million. Analysts had predicted third-quarter revenue of $625 million and billings of $593.4 million.

Demand for DocuSign products surged during the early part of the coronavirus outbreak, but many businesses are resuming in-person meetings. In addition to accommodating electronic signatures, the company’s software also automates the filing of contracts over the internet.

DocuSign has a search underway for a new chief executive. Board Chair Mary Wilderotter was named interim CEO on June 21.


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“We thought the quarter/guide were better-than-feared but we came away less confident in a timely turnaround to healthy growth and remain in wait-and-see mode until a new CEO,” said RBC Capital analyst Rishi Jaluria in a report. “DocuSign noted the company is close to naming a new CEO, suggesting M&A is off the table for now.”

Thus far in 2022, DOCU stock had retreated 63% heading into the earnings report. DocuSign holds a Relative Strength Rating of only 5 out of a best-possible 99, according to IBD Stock Checkup.

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns for issues such as DOCU stock is one key to the investment guidelines.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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