Dow shot up 167 (a little off the highs), advancers over decliners only 5-4 & NAZ added 11. The MLP index gave back another 1+ to the 267s & the REIT index lost 1+ to 350. Junk bond funds were mixed & Treasuries continued to be sold as stocks rallied. Oil rose in the 51s to a 6 month high & gold lost 2 to 1278.
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.9943224427870222)
United Technologies (UTX), a Dow stock, reported Q3 earnings of $1.33B & EPS was $1.67. EPS, adjusted for restructuring costs, came to $1.73. The results exceeded expectations of $1.68. The maker of elevators, jet engines & other products posted revenue of $15.06B, also beating forecasts. Analysts expected $14.89B. UTX expects full-year EPS of $6.58-6.63, with revenue of $59-59.5B. The stock fell 1.13.
If you would like to learn more about UTX, click on this link:
club.ino.com/trend/analysis/stock/UTX?a_aid=CD3289&a_bid=6ae5b6f7
Eli Lilly (LLY) is weighing the sale of an animal health business that the drugmaker once touted as key in helping it overcome the loss of patent protection for some top-selling drugs. LLY said that alternatives for its Elanco Animal Health business also include an IPO or a merger. The drugmaker also might still keep the business, which brought in nearly $741M in revenue during Q3. CEO David Ricks said that Elanco, which the company has bulked up with acquisitions in recent years, has been an important growth driver, & it is now. The company lost patent protection for top selling drugs like the antipsychotics Zyprexa & the antidepressant Cymbalta a few years ago, which exposed those drugs to competition from cheaper generic versions. Execs had touted the company's animal health business, as well as sales from new drugs & overseas revenue, among the factors that would help the company overcome the revenue drop. The company reported Q3 net income sank 29% to $555.6B, due in part to restructuring costs & other one-time charges. Last month, LLY said it would cut about 3500 positions as part of a plan to close some research sites & trim fixed costs. Adjusted EPS totaled $1.05 in Q3. Worldwide revenue grew 9% to $5.66B, helped by established products like the insulin Humalog as well as newer drugs. Analysts expected EPS of $1.03 on $5.52B in revenue. LLY also raised its forecast for 2017. It now expects adjusted EPS of $4.15-4.25, up from a forecast of $4.10-4.20 made in Jul. Analysts expect $4.16. The drugmaker expects to provide an update by the middle of next year. The stock retreated 2.01.
If you would like to learn more about LLY, click on this link:
club.ino.com/trend/analysis/stock/LLY?a_aid=CD3289&a_bid=6ae5b6f7
General Motors (GM) posted a quarterly net loss due to charges stemming from the sale of its Opel unit in Europe to France's Peugeot, but excluding charges its results handily beat expectations & the company reaffirmed its full-year earnings outlook. The #1 US automaker posted lower revenue for the qtr as it shuttered plants North America to reduce production & tackle bloated inventory levels, especially of unpopular sedan models as consumers move increasingly to pickup trucks, SUVs & crossovers. GM had 76 days' supply of unsold vehicles at the end of Sep, down from 88 days a month earlier & over 100 in the summer. The company's wholesale volumes were down 26% versus the same qtr in 2016. GM said it was on track to meet its goal of 70 days' supply of vehicles in US by the end of the year. But as GM has embarked on a months-long process to trim excess supply, it relied heavily on consumer discounts to sell vehicles. Discounts as a percentage of the average transaction price totaled 13.7%, slightly above the industry average. Anything over 10% is considered unhealthy for vehicle resale values & unhealthy for automakers in the long term. All of its units were profitable for the first time since Q4-2014. GM posted a Q3 net loss of $2.98B ($2.03 per share) compared with a profit of $2.77B ($1.71 per share a year earlier). Excluding discontinued operations, GM posted EPS of 8¢. Excluding one-time charges, EPS was $1.32, above expectations of $1.14. The stock rose 1.33.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7
2 top Reps announced a bill restoring federal subsidies to insurers that includes tough conditions sought by the White House. Senate has have enough votes to kill it, but the measure underscores the changes the Trump administration & congressional conservatives say they want in exchange for resuming the payments. The proposal seeks changes in ObamaCare that go far further than provisions in bipartisan legislation that is stuck in the Senate. That compromise has stalled as Pres Trump has flashed contradictory signals about whether he supports it & conservatives, especially in the House, have complained it doesn't revamp Obama's statute strongly enough. The GOP alternative is by Senate Finance Committee Chairman Orrin Hatch & House Ways & Means Committee Chairman Kevin Brady. Like the bipartisan Senate bill, the new measure would resume the federal payments to insurers for 2 years. Trump has halted them, claiming they enrich insurers, but has expressed a willingness to make a deal to resume them. The plan would temporarily halt tax penalties Obama's health care law imposes on people who don't buy insurance & employers who don't offer coverage to workers. The fine against individuals would be halted in 2017-2021, while the penalty on employers would be retroactive, suspended from 2015 thru this year. The bill also includes "pro-life protections." GOP aides would not describe them, but Reps have often sought to prevent federal payments from being used to buy health insurance that covers abortions. The measure would also let people contribute more money to tax-favored health savings accounts. Sen Patty Murray, rejected the latest bill. "We already know that partisan proposals to take coverage away from millions of people, spike premiums, and inject even more uncertainty into health care markets cannot pass the Senate," Murray said. The payments reimburse insurers for lowering out-of-pocket expenses like deductibles & co-payments for low-earning customers. Obama's law requires the cost reductions & the federal payments to insurers. The reduced costs for customers will continue, leaving insurers & state regulators to decide how carriers will recover their lost income.
Earnings were a powerful force for stocks today, but not all benefited. Markets breadth was very narrow, not a healthy sign for stocks. There is no shortage of excitement coming from DC. That wrangling puts the new tax bill along with a host of other important ones at greater risk of not getting passed. While many are important (funding the gov & raising the debt ceiling), the tax bill is critical. Stocks continue not to be disturbed. Today looks good & tomorrow will take care of itself!
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
United Technologies (UTX), a Dow stock, reported Q3 earnings of $1.33B & EPS was $1.67. EPS, adjusted for restructuring costs, came to $1.73. The results exceeded expectations of $1.68. The maker of elevators, jet engines & other products posted revenue of $15.06B, also beating forecasts. Analysts expected $14.89B. UTX expects full-year EPS of $6.58-6.63, with revenue of $59-59.5B. The stock fell 1.13.
If you would like to learn more about UTX, click on this link:
club.ino.com/trend/analysis/stock/UTX?a_aid=CD3289&a_bid=6ae5b6f7
United Technologies tops Street 3Q forecasts
Eli Lilly (LLY) is weighing the sale of an animal health business that the drugmaker once touted as key in helping it overcome the loss of patent protection for some top-selling drugs. LLY said that alternatives for its Elanco Animal Health business also include an IPO or a merger. The drugmaker also might still keep the business, which brought in nearly $741M in revenue during Q3. CEO David Ricks said that Elanco, which the company has bulked up with acquisitions in recent years, has been an important growth driver, & it is now. The company lost patent protection for top selling drugs like the antipsychotics Zyprexa & the antidepressant Cymbalta a few years ago, which exposed those drugs to competition from cheaper generic versions. Execs had touted the company's animal health business, as well as sales from new drugs & overseas revenue, among the factors that would help the company overcome the revenue drop. The company reported Q3 net income sank 29% to $555.6B, due in part to restructuring costs & other one-time charges. Last month, LLY said it would cut about 3500 positions as part of a plan to close some research sites & trim fixed costs. Adjusted EPS totaled $1.05 in Q3. Worldwide revenue grew 9% to $5.66B, helped by established products like the insulin Humalog as well as newer drugs. Analysts expected EPS of $1.03 on $5.52B in revenue. LLY also raised its forecast for 2017. It now expects adjusted EPS of $4.15-4.25, up from a forecast of $4.10-4.20 made in Jul. Analysts expect $4.16. The drugmaker expects to provide an update by the middle of next year. The stock retreated 2.01.
If you would like to learn more about LLY, click on this link:
club.ino.com/trend/analysis/stock/LLY?a_aid=CD3289&a_bid=6ae5b6f7
Lilly tops Street 3Q forecasts, considers business sale
General Motors (GM) posted a quarterly net loss due to charges stemming from the sale of its Opel unit in Europe to France's Peugeot, but excluding charges its results handily beat expectations & the company reaffirmed its full-year earnings outlook. The #1 US automaker posted lower revenue for the qtr as it shuttered plants North America to reduce production & tackle bloated inventory levels, especially of unpopular sedan models as consumers move increasingly to pickup trucks, SUVs & crossovers. GM had 76 days' supply of unsold vehicles at the end of Sep, down from 88 days a month earlier & over 100 in the summer. The company's wholesale volumes were down 26% versus the same qtr in 2016. GM said it was on track to meet its goal of 70 days' supply of vehicles in US by the end of the year. But as GM has embarked on a months-long process to trim excess supply, it relied heavily on consumer discounts to sell vehicles. Discounts as a percentage of the average transaction price totaled 13.7%, slightly above the industry average. Anything over 10% is considered unhealthy for vehicle resale values & unhealthy for automakers in the long term. All of its units were profitable for the first time since Q4-2014. GM posted a Q3 net loss of $2.98B ($2.03 per share) compared with a profit of $2.77B ($1.71 per share a year earlier). Excluding discontinued operations, GM posted EPS of 8¢. Excluding one-time charges, EPS was $1.32, above expectations of $1.14. The stock rose 1.33.
If you would like to learn more about GM, click on this link:
club.ino.com/trend/analysis/stock/GM?a_aid=CD3289&a_bid=6ae5b6f7
GM shares rise on earnings beat, solid forecast
2 top Reps announced a bill restoring federal subsidies to insurers that includes tough conditions sought by the White House. Senate has have enough votes to kill it, but the measure underscores the changes the Trump administration & congressional conservatives say they want in exchange for resuming the payments. The proposal seeks changes in ObamaCare that go far further than provisions in bipartisan legislation that is stuck in the Senate. That compromise has stalled as Pres Trump has flashed contradictory signals about whether he supports it & conservatives, especially in the House, have complained it doesn't revamp Obama's statute strongly enough. The GOP alternative is by Senate Finance Committee Chairman Orrin Hatch & House Ways & Means Committee Chairman Kevin Brady. Like the bipartisan Senate bill, the new measure would resume the federal payments to insurers for 2 years. Trump has halted them, claiming they enrich insurers, but has expressed a willingness to make a deal to resume them. The plan would temporarily halt tax penalties Obama's health care law imposes on people who don't buy insurance & employers who don't offer coverage to workers. The fine against individuals would be halted in 2017-2021, while the penalty on employers would be retroactive, suspended from 2015 thru this year. The bill also includes "pro-life protections." GOP aides would not describe them, but Reps have often sought to prevent federal payments from being used to buy health insurance that covers abortions. The measure would also let people contribute more money to tax-favored health savings accounts. Sen Patty Murray, rejected the latest bill. "We already know that partisan proposals to take coverage away from millions of people, spike premiums, and inject even more uncertainty into health care markets cannot pass the Senate," Murray said. The payments reimburse insurers for lowering out-of-pocket expenses like deductibles & co-payments for low-earning customers. Obama's law requires the cost reductions & the federal payments to insurers. The reduced costs for customers will continue, leaving insurers & state regulators to decide how carriers will recover their lost income.
GOP lawmakers propose new conditions on health bill
Earnings were a powerful force for stocks today, but not all benefited. Markets breadth was very narrow, not a healthy sign for stocks. There is no shortage of excitement coming from DC. That wrangling puts the new tax bill along with a host of other important ones at greater risk of not getting passed. While many are important (funding the gov & raising the debt ceiling), the tax bill is critical. Stocks continue not to be disturbed. Today looks good & tomorrow will take care of itself!
Dow Jones Industrials
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