The Daily Times Newspaper

IBM Down on Wall Street on Quarterly Earnings Setback

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Technology group IBM was a big loser on Thursday at the opening of the stock exchanges in New York. Investors were shocked by the news of the decline in orders for IBM’s part that manages IT systems for other companies. That setback almost wholly offset a strong revenue increase in cloud software activities last quarter.

 

Wall Street processes a lot of quarterly figures from large companies anyway. Electric car manufacturer Tesla has also looked at the books.

IBM lost more than 6 percent in the first minutes of trading. Next month, the company plans to divest its services for managing relatively old IT systems to focus entirely on the cloud. Uncertainty about that change, customers, waited to place new orders, the company explains.

Tesla made a record profit in the past quarter. Despite the worldwide chip shortages, the American group has never delivered so many cars as in July, August and September. Partly due to this, the net result was almost five times higher than in the same period last year. As a result, the stock rose 1.1 percent shortly after the opening bell.

The most important indicators on the US stock markets fell. The Dow Jones Industrial Average was 0.3 percent lower at 35,511 points. The broad-based S&P 500 fell 0.2 percent to 4,527 points. Tech exchange Nasdaq rose a fraction to 15,127 points.

The market also reacted to new data from US benefit claims. Amid the many quarterly figures from companies, earlier concerns about high inflation also resurfaced. In addition, sentiment is being weighed down by concerns about Chinese real estate group Evergrande.

AT&T, the parent company of, among others, video streaming service HBO Max and pay channel HBO, fell 0.9 percent after figures. In turn, American Airlines (plus 1.5 percent) saw its losses fall somewhat lower than widely expected. But the airline also warned of rising costs. Investors also processed the quarterly reports of casino company Las Vegas Sands (down 2 percent), paint company PPG (down 0.7 percent) and railroad company CSX (plus 3.3 percent).

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