Market Report

Over the course of the past two days of trading, the market has met with great volatility as the major indexes dove Friday, April 25^th, eventually recovering slightly on Monday, April 29^th. Entering into last weekend, the Dow Jones Industrial Average fell 0.85% and the S&P 500 dipped 0.81%. The Nasdaq was the biggest loser, falling 1.75% to close at 4,075.56 points. Intraday trading on Monday was especially volatile with the Dow peaking at 16,500.37 points and then falling to 16,312.66 before ultimately closing at 16,448.74, a gain of 0.53%. The S&P 500 and Nasdaq followed the same pattern, but whereas the S&P closed the day with a gain of 6.03 points, or 0.32%, the Nasdaq remained largely unchanged, losing 1.16 points, or 0.03%.

An overarching contributor to stock market volatility has been unrest in Ukraine and the military brinkmanship exercised by NATO, Russia, and Ukraine. Sanctions brought upon Russia by the U.S. and European states have harmed Russia’s economy, and the rising threat of a Ukrainian civil war or a Russian invasion has led investors to proceed with caution.

The major losers on Friday were the Ford Motor Company and Visa Inc., with Ford dropping 3.31% to $15.78 per share and Visa share prices falling 5.00% to $198.93 per share. Ford’s main issues stem from a massive devaluation of the Venezuelan bolivar, which has cut a $350 million gash in its profits, and an increase of $400 million of its warranty reserves, which will be used to service future recalls. Ford is also rolling out 23 new products this year, which has strained the company’s finances far more than expected. In contrast, General Motors released a successful earnings report on Thursday, greatly exceeding expectations. While its share price increased dramatically based upon this news, General Motors saw its profits nearly wiped out by recall charges of $1.3 billion, only posting a modest profit of $125 million. Visa saw its profits rise 26%, but its second quarter fiscal 2014 revenue was just shy of expectations of $3.19 billion at $3.16 billion. Visa’s share price dipped mainly during after hours trading, during which Visa released its less than stellar earnings reports on top of a downward revised revenue growth estimate, which lowered prospective revenue growth at 11% instead of 13%.

On Monday, the major indexes were largely carried by blue-chip stocks, such as Bank of America, Pfizer, Microsoft, and Apple. An accounting miscalculation by Bank of America forced it to suspend its stock buyback program along with its plans of increasing stock dividends. This news caused Bank of America shares to drop 6.27%. Pfizer is once again attempting to acquire European-based rival AstraZeneca for over $100 billion, potentially making it one of the largest acquisitions in the history of the pharmaceuticals industry. Pfizer shares rose 4.7%, while AstraZeneca shares grew 12.16%. Microsoft and Apples spearheaded a modest rebound of tech stocks. Microsoft saw increased revenue from Xbox One sales and Xbox Live transactions. In addition, it has expressed its intention to develop original television series exclusive to its Xbox platform. Furthermore, advertisement revenue from its Bing search engine has increased by over 30%. Microsoft share prices rose 2.41%, but may dip in the future due to an exploit in its Internet Explorer browsing service, which enables hackers to implant malicious software onto a computer and potentially take it over entirely. Apple overtook earnings expectations with a quarterly revenue of $45.6 billion and earnings per share of $11.62, by far beating expectations of $43.7 billion in revenue and $10.19 earnings per share. Its share price rose 3.87% Monday and has risen 7.41% from January. In addition, Apple has seen competitive growth in overseas markets, especially in Europe, indicating strong core operations and a growing, resilient global market share.