By Swissquote Analysts
Oracle Stock Falls Following Forecast as Revenue Disappoints
Topic of the day
Oracle Corp. shares recouped some of their losses in the extended session Thursday after the forecast revenue range bookended the Wall Street consensus, as the software company’s largest business unit topped forecasts, but its others didn’t. Oracle ORCL shares were down about 3.5% after hours following the forecast. Prior to the forecast, shares had dropped more than 5% and were around those levels when a conference call with analysts began. Oracle shares declined 1.8% in the regular session to close at $86.87. On the call with analysts, Oracle Chief Executive Safra Catz forecast fourth-quarter earnings of $1.56 to $1.60 a share on revenue growth of 15% to 17%, or $13.62 billion to $13.85 billion. Analysts surveyed by FactSet had estimated $1.47 a share on revenue of $13.75 billion. That followed fiscal third-quarter results in which Oracle reported net income of $1.9 billion, or 68 cents a share, compared with $2.32 billion, or 84 cents a share, a year ago. Adjusted earnings, which exclude stock-based compensation expenses and other items, were $1.22 a share, compared with $1.13 a share in the year-ago period. Revenue rose to $12.4 billion from $10.51 billion in the year-ago quarter. Oracle’s board also hiked the quarterly dividend 25% to 40 cents a share. The dividend will be paid April 24 to shareholders of record as of April 11.
The Switzerland stock market ended weak on Thursday, extending losses to a fourth straight session, as worries about growth and interest rates continued to weigh on sentiment. The benchmark SMI, which stayed in negative territory right through the day's session, ended with a loss of 76.41 points or 0.69% at 10,948.85. Novartis drifted down nearly 4%. Credit Suisse shed about 2% after postponing publication of its annual report. Swiss Life Holding ended 1.25% down, while Holcim, Richemont, Partners Group, Roche Holding and Swiss Re lost 0.6 to 1%. Sonova and Sika climbed 2.33% and 2.24%, respectively. Logitech gained about 1.5%, while Givaudan and ABB advanced 1.16% and 1.04%, respectively. In the Mid Price Index, Baloise Holding tumbled 6.2%. Belimo Holding lost 2.22%, while Clariant, PSP Swiss Property, Helvetia, Bachem Holding and Swiss Prime Site lost 0.8 to 1.1%. Tecan Group surged more than 2%. Straumann Holding gained about 1.5%, VAT Group climbed 1.26%, Schindler Holding gained about 1%, while Zur Rose, Schindler Ps and Georg Fischer advanced 0.7 to 0.84%.
European stocks closed broadly lower on Thursday amid concerns about interest rates following Fed Chair Jerome Powell reiterating his warning to lawmakers that the central bank may rise rates higher than previously anticipated. Weaker-than-expected inflation data from China also weighed on sentiment. Powell acknowledged during the second day of congressional testimony that the Fed was wrong in initially thinking inflation was only the result of 'transitory' factors. Investors also digested the latest batch of economic data from the European region, and some quarterly earnings updates. The pan European Stoxx 600 drifted down 0.22%. The U.K.'s FTSE 100 dropped 0.63% and France's CAC 40 slid 0.12%, and Germany's DAX edged up 0.01%. Switzerland's SMI ended 0.69% down.
Among other markets in Europe, Austria, Belgium, Czech Republic, Finland, Iceland, Ireland, Norway, Poland, Russia, Spain and Sweden ended weak. Denmark, Greece and Turkiye closed higher, while Netherlands and Portugal ended flat. In the UK market, Spirax-Sarco Engineering, Smith (DS), Rio Tinto, Entain, Ocado Group and Antofagasta ended lower by 4 to 5%. Endeavour Mining shed nearly 4%. British Land Co., Barclays, Beazley, ABRDN, Glencore, Weir Group, Anglo American Plc, Johnson Mathey and Segro lost 2 to 3.4%. Aviva, Informa, BAE Systems, Frasers Group, Rentokil Initial, Sage Group and Centrica gained 1 to 3%. In Paris, Unibail Rodamco ended nearly 4% down. Renault shed about 3%. BNP Paribas, Stellantis, Societe Generale, Teleperformance, Publicis Groupe, Saint Gobain, Credit Agricole and Michelin lost 1 to 2%. Thales rallied 2.8% and Eurofins Scientific climbed 2.3%, while Worldline, Schneider Electric, STMicroElectronics, Safran and Danone gained 1 to 1.7%.
Stocks fell Thursday after jobless claims showed that the labor market is still strong, complicating the picture for the Federal Reserve's rates path. Stocks started the day higher, then turned down by midday. Losses picked up steam in the afternoon. The S&P 500 was recently down 1.8%. The tech-focused Nasdaq Composite dipped about 2%, and the Dow Jones Industrial Average dropped about 1.6%, or 542 points. Stocks have ricocheted this week as investors rethink their expectations for interest rates, with many traders growing increasingly convinced that the Fed will push rates higher than previously expected and keep them there for longer. Stocks fell on Tuesday after Fed Chair Jerome Powell said that the central bank is prepared to quicken the pace of interest-rate increases if warranted. Shares of SVB Financial Group, owner of Silicon Valley Bank, plunged 60%. The bank said Wednesday it intends to launch an offering of $1.25 billion of its common stock, and Moody's Investors Service subsequently downgraded the bank's credit rating. Silvergate Capital fell 42% after the bank said Wednesday it would voluntarily wind down operations.
In the wake of the sharp decline on Wall Street and caution ahead of the US labor market data for February due later in the day, stock markets in East Asia are down sharply in trading on Friday. The losses on the stock exchanges in East Asia ranged from 1.1 per cent in Shanghai and Seoul to 2.4 per cent in Hong Kong. Sydney also fell by 2.3 per cent. Trading has already ended there. The Nikkei index in Tokyo lost 1.6 per cent to 28,149 points.
In U.S. bond markets, the yield on the benchmark 10-year Treasury note fell to 3.922%, from 3.974% Wednesday. Yields and prices move inversely.
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