Aug 2, 2024 - Business
The 20% air pocket
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Three companies that reported second-quarter earnings on Wednesday — Moderna before the bell, and Intel and Snap after the close — got harshly punished by the markets.
Why it matters: The better the stock market broadly is doing, the more individual companies tend to fall on bad news.
- Judging by Wednesday's market action, the current size of the air pocket is just over 20%.
Driving the news: Moderna was expected to sell $4 billion of drugs this year. On Wednesday, it changed that guidance. It now expects to sell less than $3.5 billion and possibly as low as $3 billion.
- Snap's fall was also blamed on weak guidance, although the new figures were largely in line with the old ones.
- Intel said it would scrap its dividend in the fourth quarter and lay off 15% of its workforce.
The bottom line: In today's market, stocks can be presumed to be outperforming only until their next earnings report.
