—— Kamala Narrows Trump Lead Significantly; US IPO Market Heats Up with $5.5bn Equity Offering; UPS Share Price Drops Most in 16 Years; 56,000 US Home Sales Fell Through in June; Tesla Profit Missed Forecast in Second Quarter; Comcast Revenues of Studios and Theme Parks Drop
1. Kamala Narrows Trump Lead Significantly
Joe Biden’s decision to withdraw from the 2024 White House race and endorse Kamala Harris as his successor has quickly impacted campaign contributions, prediction markets, and endorsements.
The coming days will reveal if this momentum translates into improved poll numbers. An early indicator, a national Morning Consult poll—the first major survey since Biden’s announcement on Sunday—shows Harris trailing former President Donald Trump by two percentage points, 47% to 45%, within the margin of error. This is an improvement from the six-point deficit Biden faced before exiting the race.
There is potential for Harris’s candidacy to benefit the Democrats. Recent polls indicate she performs better than Biden in head-to-head matchups against Trump.
For months, polls considering a Harris-Trump contest showed her lagging behind Biden by several points. For instance, the Bloomberg News/Morning Consult poll of battleground states showed Harris trailing Trump by seven percentage points, compared to Biden’s four-point deficit.
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2. US IPO Market Heats Up with $5.5bn Equity Offering
U.S. initial public offerings (IPOs) are expected to see a significant boost this week, with up to $5.5 billion in first-time equity issuance potentially marking a turning point amid the recent slump in new listings.
Leading the way is Lineage Inc., a temperature-controlled storage and logistics real estate investment trust, which is aiming for a deal of up to $4 billion. This represents the most crowded slate of new issues since September. The usual flurry of tech firm IPOs, typically the market’s mainstay due to their rapid growth compared to public peers, has been largely absent. Many companies have opted to secure private funding to avoid the risks of going public in the current market climate. Bankers and corporate leaders are hopeful that this new wave of listings will generate momentum.
Paul Abrahimzadeh, Citigroup Inc.’s co-head of equity capital markets for North America, commented, “The backlog for Q3 ended up being a lot lighter than we would’ve liked from a growth IPO perspective. The IPO market started to open and volumes are up, but it just didn’t have the sustained momentum we would’ve liked.”
Lineage is expected to price its offering after the market closes on Wednesday, the same day Select Medical Holdings Corp.’s occupational health services unit, Concentra Group Holdings Parent Inc., will conduct its carve-out fundraising. Additionally, KKR & Co.’s OneStream Inc. and existing shareholders plan to raise approximately $466 million a day earlier.
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3. UPS Share Price Drops Most in 16 Years
United Parcel Service Inc. (UPS) experienced its largest share drop in over 15 years after reporting second-quarter profits that fell significantly short of Wall Street’s expectations, primarily due to wage inflation and weak package demand.
On Tuesday, UPS announced adjusted second-quarter earnings of $1.79 per share, compared to the $1.98 per share forecasted by analysts, according to Bloomberg estimates. Revenue also missed expectations.
These disappointing results represent a setback for UPS as it grapples with increased labor costs amid a decline in demand following the pandemic-driven e-commerce surge. Investors had already expressed doubts about the company’s ability to meet its long-term sales goals announced in March.
“We think this quarter represents a further leg down on investor sentiment for the stock,” Jefferies analyst Stephanie Moore noted in a research report.
UPS shares plunged more than 11% after markets opened in New York on Tuesday, marking their largest intraday drop since October 2008. Prior to this, the stock had already fallen 7.7% this year through Monday’s close.
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4. 56,000 US Home Sales Fell Through in June
In June, U.S. home deals were canceled at the highest rate on record, driven by affordability pressures that sidelined potential buyers.
According to a report from Redfin Corp. on Tuesday, nearly 56,000 home purchases were canceled last month, representing about 15% of all homes that went under contract in June. This is the highest share of cancellations for June since the brokerage began tracking this data in 2017.
“Buyers are getting more and more selective,” said Julie Zubiate, a Redfin real estate agent in the San Francisco Bay area. “They’re backing out due to minor issues because the monthly costs associated with buying a home today are just too high to rationalize not getting everything on their must-have list.”
Buyers are becoming increasingly cautious due to record-high home prices and interest rates hovering just below 7%. The steep costs are causing many house hunters to back out of deals, sometimes over minor issues.
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5. Tesla Profit Missed Forecast in Second Quarter
Tesla Inc. missed Wall Street profit estimates for the second quarter, adding to a challenging year characterized by slower sales and widespread layoffs within the company.
On Tuesday, the electric vehicle maker reported adjusted earnings of 52 cents per share, falling short of the average analyst estimate of 60 cents per share. However, Tesla’s revenue rose to $25.5 billion, exceeding the expected $24.6 billion. The company reiterated its forecast for a “notably lower” growth rate in 2024.
Despite the profit miss, Tesla’s second-quarter sales had previously exceeded analyst expectations, causing a surge in the stock. While sales were down compared to the previous year, they showed improvement from the first quarter of this year, driven partly by a series of price cuts that affected the company’s margins.
Following the early July sales report, Tesla shares continued to rally. Investors have been encouraged by Elon Musk’s promises of imminent fully autonomous robotaxis and humanoid robots, which have helped reverse a year-to-date decline in the stock price. At one point in 2024, shares were down more than 40% from the end of last year due to weaker vehicle sales.
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6. Google Parent Revenue Beat Forecast
Google parent Alphabet Inc. reported second-quarter revenue that surpassed analysts’ expectations, driven by strong demand for cloud-computing services and advertising on its search engine.
The company’s sales, excluding partner payouts, reached $71.36 billion in the second quarter, exceeding the $70.7 billion forecasted by analysts, according to Bloomberg data. Net income was $1.89 per share, slightly above Wall Street’s estimate of $1.84 per share.
Google initially had an advantage in the AI sector, having developed much of the technology behind popular chatbots. Now, the company is striving to demonstrate its ability to compete with OpenAI and Microsoft Corp., which are promoting chatbots capable of answering questions in a conversational manner, potentially diverting users from traditional web searches. Google has been integrating artificial intelligence into its widely-used products, including Gmail, Google Docs, and search, though results have been varied.
Additionally, Google’s provision of cloud-computing services to fast-growing startups has contributed to consistent profitability in this segment after years of financial losses.
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7. Comcast Revenues of Studios and Theme Parks Drop
Comcast Corp. reported second-quarter revenue that fell short of analysts’ expectations, impacted by a slower season at its movie studios and theme parks.
The company’s revenue dropped 2.7% to $29.7 billion, missing the $30 billion average projection by analysts, as stated in a company release. Revenue from studios decreased by 27%, and theme park sales fell by 11%.
On the film side, Comcast’s Universal Studios didn’t have a blockbuster release in the latest quarter to match last year’s successes, “The Super Mario Bros. Movie” and “Fast X.”
Comcast’s theme parks saw a strong recovery from the Covid-19 pandemic, but customers have since shifted to other forms of entertainment, such as international travel and cruises. This trend coincided with Comcast’s schedule for launching new attractions, leaving a gap in this year’s ride openings.
Notably, the Epic Universe theme park in Orlando, initially set to open this year, has been delayed until 2025.
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本文内容来自《Financial Times》、《Bloomberg》，以及《The Real Deal》等多家财经新闻媒体。