The US stock markets closed higher on Tuesday amid earnings reports from leading corporations such as Amazon, Alphabet and Alibaba.
The major theme that stood out was the stimulus talks between President Joe Biden with both Democrats and Republicans on the next relief package to support the country’s economy.
The Dow Jones closed 475 points higher, the S&P 500 was up 1.39% while the Nasdaq 100 rose 1.56%.
Major News
Amazon Earnings, Bezos To Step Down
Amazon released its fourth-quarter earnings on Tuesday with revenue increasing by 44% to a record $125.6 billion.
The company has also announced that CEO & founder Jeff Bezos will transition to the role of executive chair in the third quarter and will be replaced by Andy Jassy, the CEO of Amazon Web Services (AWS).
Amazon said operating income rose to $6.9 billion with net income up to $7.2 billion. Operating cash flow increased 72% to $66.1 billion for the trailing twelve months, compared with $38.5 billion for the trailing twelve months ended December 31, 2019.
Alibaba Earnings
Alibaba’s fourth quarter revenue for the period ended December 31 2020 rose 37% to $33.9 billion.
In December, mobile monthly active users in China rose by 21 million compared to September to 902 million.
Meanwhile, the company’s founder Jack Ma was left off a list of Chinese entrepreneurial leaders published by state media according to Reuters.
Jack Ma was not mentioned in a front-page article published by the Shanghai Securities News. Instead, Huawei’s Ren Zhengfei, Xiaomi’s Lei Jun and BYD’s Wang Chuanfu were lauded for their contributions.
Alphabet Earnings
Google’s parent firm Alphabet Inc. on Tuesday released its financial results for the fourth quarter with revenue up 23% to $56.90 billion. Operating income rose 69% to hit $15.65 billion. Net income was up 43% to $15.23 billion.
Google Advertising’s revenue rose 22% to $46.20 billion, while Cloud services segment revenue rose 47% to $3.83 billion.
“Our strong results this quarter reflect the helpfulness of our products and services to people and businesses, as well as the accelerating transition to online services and the cloud. Google succeeds when we help our customers and partners succeed, and we see significant opportunities to forge meaningful partnerships as businesses increasingly look to a digital future,” CEO Sundar Pichai said in the press release.
Pfizer Earnings
American multinational pharmaceutical corporation Pfizer Inc. on Tuesday said its revenues rose 12% to $11.68 billion in the fourth quarter of 2020. Net income was up to $594 million from a net loss of $337 million recorded in the same period of 2019.
Pfizer revised up its guidance for 2021 “due primarily to additional refinements of its COVID-19 vaccine revenue forecast,” expecting its EPS to amount to between $3.10 to $3.20 and its revenues to land at between $59.4 to $61.4 billion.
“I am very pleased with how our company performed in 2020, and particularly in the fourth quarter, where we achieved double-digit operational revenue growth driven by a wide range of products and geographies, including growth within all of our therapeutic areas,” Pfizer’s CFO said in a statement.
Tesla Recalls Over 100,000 cars, Musk Off Twitter for a while
Tesla said it would “voluntarily” recall all Model S and Model X vehicles that have experienced issues with the touchscreen display.
According to the Wallstreet Journal, the problem affected about 158,000 vehicles, including Model S sedans built between 2012 and early 2018 and Model X vehicles made from 2016 through early 2018.
After his tweets drove share prices of some Wallstreet stocks, Elon Musk said on Tuesday that he will be off Twitter for “a while.” However, when previously tweeting such comments, Musk would return to Twitter within days.
Ford invests $1.05 billion in South Africa
Ford has announced plans to invest up to $1.05 billion in its Ford Silverton Assembly Plant in South Africa to modernize production. In a statement, the firm said the move will see the factory become Ford’s first fully energy self-sufficient plant and its first carbon-neutral operation by 2024.
The project will also include adding 1,200 employees which will bring the total number of Ford employees in South Africa to 5,500. It will also add an estimated 10,000 new jobs across Ford’s local supplier network, bringing the total to 60,000.
Uber Acquires alcohol marketplace Drizly
Uber Technologies on Tuesday said it is acquiring American on-demand alcohol marketplace Drizly for approximately $1.1 billion in stock and cash. It announced that 90% of the consideration will be paid to the Drizly stockholders will consist of shares of Uber common stock, with the balance to be paid in cash.
Drizly will become a fully-owned subsidiary of Uber, while the long-term plan includes integration of Drizly’s marketplace with the Uber Eats app.
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