Despite European Central Bank policymakers signaling an upcoming fresh stimulus in December 2020, the European stock market sell-off continues. Christine Lagarde, the European Central Bank president, acknowledged that the eurozone economy is “losing momentum more rapidly than expected” as Germany, France, and Switzerland have tighter restrictions since Wednesday 2.10.2020.
Even promising quarterly earnings from the largest U.S. tech stocks was not enough to prevent investors from selling shares even on late Thursday; the market fears for both the rising coronavirus cases around the world and the upcoming U.S election.
The biggest names in the stock markets, Apple, Amazon, Facebook, and Alphabet, all reported quarterly results on 29.10.2020. and all four were positive outlining how these companies benefited from the pandemic, pushing many economic activities online.
Apple is the company that taught others why any company needs to meet minimum expectations to be able to have little tolerance. Apple earned more per share during this pandemic and made more revenue than Wall Street forecasted. Apple earned 73 cents per share on revenue of $64.7 billion. However, there was one single, critical area where the company was a little bit lower than expectations. In the recent quarter, the revenue from devices sold was $26.44 billion compared to the expected $27.1 billion; that news sent the shares down by 4.4%. This weakness came from China where Apple’s revenue went down by 29% in the fourth quarter. But the company CEO, Tim Cook, said that the initial response to the iPhone 12 has been “tremendously positive.”
Economic data in the U.S on Thursday exceeded expectations with third-quarter GDP leaping by a record 33.1% and weekly jobless claims improving by more than what already expected.
“As we’ve seen in reactions from some of the earnings from these large companies even beats are not strong enough to satisfy this market, which I think speaks to how fully valued a lot of these stocks are,” said Evan Brown, head of the multi-asset strategy at UBS Asset Management.