Key Points to Consider Before the Thursday Stock Market Opening

Market Updates: Dow's Winning Streak, McDonald's Sales, Meta's Earnings, Shell's Decline, and Comcast's Profit

Dow's Winning Streak Continues

The Dow Jones Industrial Average has extended its winning streak to 13 sessions, a feat not seen since 1987. If it reaches 14 positive sessions on Thursday, it will tie a record set in 1897. The Dow's latest victory came after the Federal Reserve raised its benchmark interest rate. Although Fed Chairman Jerome Powell acknowledged that inflation had slowed, he stated that there is still progress to be made. There is a possibility that the Fed will maintain its current policy in September.

McDonald's Strong Quarter

McDonald's had a successful quarter, driven in part by a viral social media marketing campaign featuring its iconic mascot, Grimace. Sales grew across various markets, including China, the United Kingdom, Germany, and the United States. In the US, which is McDonald's largest market, sales increased by 10.3% during the quarter.

Meta Exceeds Expectations

Meta, formerly known as Facebook, reported strong second-quarter earnings that surpassed Wall Street's estimates. The company's guidance for the current quarter was particularly impressive and exceeded analysts' expectations. The growth in Meta's digital advertising revenue can be attributed to Chinese companies and online retailers. Despite losses in its metaverse business, Meta's stock rose by 8% during after-hours trading.

Shell's Profit Decline

Oil giant Shell experienced a significant decline in profit for the second quarter due to falling commodity prices. The adjusted profit figure of $5.1 billion fell short of the estimated $6 billion. This decline was expected, considering the exceptionally high profits recorded last year. French oil giant TotalEnergies also reported a decline in earnings, citing a softening oil and gas environment.

Comcast's Profit and Streaming Challenges

Comcast, a cable and entertainment giant, surpassed Wall Street's expectations and remained profitable despite ongoing cord-cutting and slowing broadband growth. However, the company's streaming service, Peacock, continues to incur financial losses, despite an increase in subscribers. Comcast's theme parks, including the new Super Nintendo World, performed well, driving attendance in Hollywood. Revenue at the Orlando, Florida park, however, experienced a decline. In conclusion, the current market updates offer valuable insights for new businesses. The Dow's winning streak indicates a positive economic outlook, potentially indicating opportunities for growth and investment. This can be especially advantageous for startups looking for funding or seeking to go public. Similarly, McDonald's strong quarter demonstrates the power of effective marketing campaigns in driving sales. New businesses can learn from McDonald's success and harness the potential of social media to boost brand visibility and customer engagement. Meta's impressive earnings highlight the importance of digital advertising revenue. Chinese companies and online retailers played a crucial role in driving Meta's growth, providing an opportunity for new businesses to tap into similar partnerships or target these expanding markets. However, it's essential for new businesses to balance their investments and carefully consider potential risks, as witnessed by Shell's decline in profits due to falling commodity prices. This serves as a reminder for startups to diversify their portfolios and mitigate reliance on specific industries or volatile markets. Finally, Comcast's ability to remain profitable amidst cord-cutting trends suggests the resilience of the cable and entertainment industry. However, the challenges faced by its streaming service, Peacock, serve as a cautionary tale for new businesses entering the streaming market. Startups should carefully evaluate market trends and competition before venturing into highly competitive industries. Overall, while the market updates provide various opportunities and cautionary lessons for new businesses, it is crucial for entrepreneurs to conduct thorough research, develop solid strategies, and adapt to evolving market conditions. By leveraging the lessons learned from market updates, new businesses can position themselves for success in an ever-changing business landscape. Article First Published at: https://www.cnbc.com/2023/07/27/5-things-to-know-before-the-stock-market-opens-thursday-july-27.html