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T3's Take 3: Markets Rally on Strong Banks and Biotech


Today's financial recap and tomorrow's financial outlook.

Today on T3 Live

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Netflix Reports 

Netflix (NFLX) reported earnings after the close yesterday. The company missed on several metrics and shares fell as much as 16% after the release.

EPS was reported at seven cents, missing the consensus by one cent. Revenue fell slightly short of expectations, coming in at $1.738 billion vs. the expected $1.75 billion. 

Netflix also reported weak US subscriber growth, which it attributed to the introduction of new chip-based credit cards.

The new chip cards interrupt the the payment system used by Netflix.

The company was also forced to recognize some some programming costs earlier than expected.

Netflix shares declined 8.3% today, closing at $101.09.

Even with today's decline, Netflix is a top performer this year, up 52.3% year-to-date. 

US Markets

Equities rose today as investors embraced high-beta stocks.

The S&P 500 finished up 1.5%.  The NASDAQ outperformed, finishing up 1.8%.

The iShares NASDAQ Biotechnology ETF (IBB) rallied 4.4% and tech heavy-weight Apple (AAPL) finished up 1.5%.

Financials were also very strong, with Citigroup (C) and Goldman Sachs (GS) showing impressive gains after their solid earnings reports.

US inflation data showed that CPI fell by 0.2% last month, which was in-line with expectations. Jobless claims were better-than-expected, while the Philly Fed Index missed estimates.

The US dollar fell against major currency pairings, most notably against the yen. The dollar made small gains against the euro. Bond yields were up as investors opted into the stock rally. 

World Equity Markets

The Shanghai Composite recovered its early losses and closed up 2.3%. The Hong Kong Hang Seng rallied 2%. 

The Nikkei gained 1.1%. The yen gained against the dollar,driving up export-oriented stocks. 

The Korean Kopsi was up 1.2% after the Bank of Korea announced that interest rates will remain unchanged. 

Europe closed higher today.The German DAX and French CAC finished up 1.4% and 1.5%, respectively.

They were pushed up after big name US financials Citigroup (C), and Goldman Sachs (GS) reported solid earnings and rallied.

Fashion company Burberry tumbled 8% after missing earnings. Volkwagen (VW) slipped 3.6% upon announcing a recall of 8.5 million diesel-engine cars in the European Union. 

Friday's Financial Outlook

US economic data for tomorrow will include industrial production, capacity utilization, manufacturing production, JOLTS job openings, University of Michigan sentiment, the Baker Hughes rig count, and TIC Flows.

The only major global economic data point is the Euro-zone CPI. 

General Electric (GE), Honeywell (HON), Progressive (PGR), SunTrust (STI), Synchrony Financial (SYF), W.W. Grainger (GWW) will report earnings before the open tomorrow.
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