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Market futures are down around 2% to start a new trading week, as expiring contracts on future oil deliveries are sending spot prices in West Texas Intermediate (WTI) and Brent crude indexes plummeting. In particular, WTI futures for May are down 36% — just today — to below $12 per barrel. Brent May futures are down 6%. The Dow Jones is leading stock market indexes down, with companies like ExxonMobil (XOM - Free Report) particularly affected, off 450 points ahead of today’s opening bell.
Contracts on oil delivery expire tomorrow, which is problematic for oil storage facilities that have seen a supply glut in recent weeks. Stay-at-home initiatives and lack of demand for things like air travel have challenged capacity, which has led to the free-fall in oil prices. As a result, we currently see price-per-barrel not seen since 2002. And future contracts for following months are selling off, as well — June, for instance, is off by 10% at this hour.
Speaking of oil services, Halliburton Co. (HAL - Free Report) posted mixed results in its Q1 earnings report this morning — 31 cents per share beat the 25 cents in the consensus estimate, though quarterly revenues of $5.04 billion was a little light of the $5.08 billion in the Zacks consensus. The oilfield services major announced it will be cutting costs by $1 billion, as well as reducing capital spending by $800 million. Certainly, lower crude oil prices such as what we’re seeing this morning won’t signify good things for the company’s Q2.
After the market closes this afternoon, we get Q1 earnings results from IBM Corp. (IBM - Free Report) . The Zacks Rank #4 (Sell)-rated company with a Value-Growth-Momentum grade of D is expected to bring in $1.70 per share on $17.97 billion. IBM has not missed on quarterly earnings since Q3 2014, though the trialing 4-quarter average positive surprise is a mere 1.84%.
Finally, Congress is at work this week, trying to extend a small business loan deal designed to aid companies and stop the bleeding of job layoffs in the country. Over the past 4 weeks, more than 22 million Americans have lost their jobs. This new deal, which reportedly is supported by both Republicans and Democrats in both houses, expects to see up to 900K applicants by later this week, assuming the deal passes. The Senate reportedly takes up the vote today.
Zacks' research breakthrough now predicts with near 80% precision which stocks will beat earnings expectations before their reports are released. This has led to double-digit gains in less than 1 week.
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Crude Oil Futures Plummet, Taking Markets Down
Monday, April 20, 2020
Market futures are down around 2% to start a new trading week, as expiring contracts on future oil deliveries are sending spot prices in West Texas Intermediate (WTI) and Brent crude indexes plummeting. In particular, WTI futures for May are down 36% — just today — to below $12 per barrel. Brent May futures are down 6%. The Dow Jones is leading stock market indexes down, with companies like ExxonMobil (XOM - Free Report) particularly affected, off 450 points ahead of today’s opening bell.
Contracts on oil delivery expire tomorrow, which is problematic for oil storage facilities that have seen a supply glut in recent weeks. Stay-at-home initiatives and lack of demand for things like air travel have challenged capacity, which has led to the free-fall in oil prices. As a result, we currently see price-per-barrel not seen since 2002. And future contracts for following months are selling off, as well — June, for instance, is off by 10% at this hour.
Speaking of oil services, Halliburton Co. (HAL - Free Report) posted mixed results in its Q1 earnings report this morning — 31 cents per share beat the 25 cents in the consensus estimate, though quarterly revenues of $5.04 billion was a little light of the $5.08 billion in the Zacks consensus. The oilfield services major announced it will be cutting costs by $1 billion, as well as reducing capital spending by $800 million. Certainly, lower crude oil prices such as what we’re seeing this morning won’t signify good things for the company’s Q2.
After the market closes this afternoon, we get Q1 earnings results from IBM Corp. (IBM - Free Report) . The Zacks Rank #4 (Sell)-rated company with a Value-Growth-Momentum grade of D is expected to bring in $1.70 per share on $17.97 billion. IBM has not missed on quarterly earnings since Q3 2014, though the trialing 4-quarter average positive surprise is a mere 1.84%.
Finally, Congress is at work this week, trying to extend a small business loan deal designed to aid companies and stop the bleeding of job layoffs in the country. Over the past 4 weeks, more than 22 million Americans have lost their jobs. This new deal, which reportedly is supported by both Republicans and Democrats in both houses, expects to see up to 900K applicants by later this week, assuming the deal passes. The Senate reportedly takes up the vote today.
Mark Vickery
Senior Editor
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Advance Notice of Positive Earnings Surprises
Zacks' research breakthrough now predicts with near 80% precision which stocks will beat earnings expectations before their reports are released. This has led to double-digit gains in less than 1 week.
See the Stocks It's Picking Now >>