Those Trump tariffs that were supposed to help U.S. aluminum producers? Not exactly having the desired effect. Shares of Alcoa posted a double-digit decline a day after the company cut its 2018 earnings forecast, citing U.S. levies on aluminum it produces in Canada and ships into the U.S. market. With higher energy costs and lower aluminum prices - pressured by fears of a trade-related economic slowdown - also weighing on Alcoa’s earnings, it’s no wonder the metal-maker’s stock is having a meltdown.
AA - NYSE, US$40.31, down US$6.95 or 14.71 per cent over week
Skechers U.S.A. (DOG)
Business quiz! Shares of shoe maker Skechers fell after: a) dozens of children suffered mild electrical burns when their light-up shoes short-circuited, prompting a massive recall; b) Skechers’ new Trump-inspired slogan - Just Don’t Not Do It - prompted a lawsuit from rival footwear maker Nike; c) Skechers’ second-quarter earnings dropped about 24 per cent, missing estimates, and its third-quarter forecast also fell well short of analysts’ expectations. Answer: c.
SKX - NYSE, US$26.27, down US$5.02 or 16.04 per cent over week
Momentum stocks are great - until they’re not. Netflix plunged after the streaming service, hurt by a dearth of new content and competition from the World Cup, posted second-quarter subscriber growth that missed the company’s own estimates by more than one million users. Adding to the pain, a report said Walmart is planning to launch a video streaming service in the fourth quarter, taking direct aim at Netflix and Amazon. Stay tuned, this could get interesting.
NFLX - Nasdaq, US$361.05, down US$34.75 or 8.78% over week.
Listen carefully: That’s the sound of thousands of widows and orphans cheering. Shares of TransCanada - a stock favoured by risk-averse investors - posted a big gain after the U.S. Federal Energy Regulatory Commission (FERC) released amendments that will soften the impact of U.S. tax reform on pipeline companies. With fellow pipeline operator Enbridge also rising sharply, it’s party time at the retirement home.
TRP - TSX, $58.06, up $0.86 or 1.50% over week.
Philip Morris International (STAR)
Can’t smoke at the office. Can’t smoke in a restaurant. Can’t even smoke while you’re pumping gas any more. With more people butting out, shares of tobacco giant Philip Morris International have lost roughly one-third of their value in the past year. It hasn’t helped that sales of the company’s IQOS vaping device have failed to meet expectations. With the company slashing its 2018 earnings guidance this week, investors dropped the stock like a bad habit. But then, like addicts in withdrawal, they couldn’t stop themselves from buying it again.
PM - NYSE, US$84.31, up US$1.63 or 1.97% over week.