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Weekly market wrap July 27, 2018: Tech turmoil sinks stocks as investors unfriend Facebook
10/16/2018 8:39:17 AM
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By Fund Library News Wire  | Friday, July 27, 2018


 

By Mike Keerma

Rattled by disappointing quarterly reports from bellwether stocks like Exxon Mobil, Intel, Facebook, and Twitter, the major North American market indices lost ground towards the end of the week despite red-hot U.S. GDP growth of 4.1% annualized in the second quarter. The S&P 500 Composite Index managed to gain only 0.6% on the week, but the tech-weighted Nasdaq Composite Index lost 1.1%. Toronto’s benchmark S&P/TSX Composite Index ticked down 0.3% on the week overall weighed down by the slump in tech stocks and a 2.1% decline in the price of crude oil on the week.

In company news, shares of social media giant Facebook Inc. (NASDAQ: FB) fell 19% on Thursday as its quarterly earnings report showed that revenue missed expectations on slowing user growth. Weaker-than-expected revenue growth guidance contributed to the selloff, which resulted in a drop of about US$120 billion in market capitalization for Facebook in Thursday’s session. Weaker earnings also bedevilled the other social media giant Twitter Inc. (NASDAQ: TWTR), whose shares plummeted 20% on the week, as second-quarter earnings came in below expectations.

The news wasn’t all bad in the tech sector though. Online retailer and cloud-computing giant Amazon.com Inc. (NASDAQ: AMZN) posted its biggest quarterly profit ever at US$2.5 billion (US$5.07 per share), up from US$0.40 per share in the same period a year ago. The company doubled street expectations of US$2.48 per share.

FUND NEWS

* Invesco changes fund names. Invesco Canada announced that effective with the close of business on July 27, it is changing the names of the funds in its lineup of mutual funds, institutional pooled funds, and ETFs. Funds with the Trimark and PowerShares names will be rebranded with only the Invesco name. The investment objectives, strategies, and portfolio management teams remain the same for all but five funds. The full list of name changes is available in Invesco’s press releases for mutual and institutional pooled funds and for ETFs.

* Arrow launches second ETF. Arrow Capital Management Inc. debuted its second actively managed ETF this past week, the Exemplar Growth and Income Fund (TSX: EGIF). According to an Arrow press release, the fund “is designed to offer investors a balance of growth and income, making strategic asset class shifts based on where the best opportunities exist. With a focus on providing capital preservation during times of market turmoil, the fund’s managers aim to mitigate risk through various hedging strategies.”

Check Fund Library’s Market Activity page regularly for active updates on key market indexes and commodities.

@FundLibrary – Follow Fund Library on Twitter for daily information and updates.

Disclaimer

© 2018 by Fund Library. All rights reserved. Reproduction in whole or in part by any means without prior written permission is prohibited.

The foregoing is for general information purposes only and is the opinion of the writer. No guarantee of investment performance is made or implied. It is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting or tax advice.

 
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