NASDAQ Rebounds After-Hours Following Surge in Apple Shares

The major U.S. equity indexes finished mixed on Tuesday as earnings remained at the forefront with positive results from McDonald’s and General Electric grabbing the headlines early in the session, only to give way to bad results from Alphabet (Google’s parent company). After the bell, shares of Apple surged after the company beat expectations. This helped somewhat offset Alphabet’s steep decline.

At the cash market close, the benchmark S&P 500 Index finished at 2945.83, up 2.80 or +0.10%. The blue chip Dow Jones Industrial Average closed at 26592.91, up 38.52 or +0.15% and the technology-based NASDAQ Composite settled at 8095.39, down 66.46 or -0.89%.

McDonald’s, General Electric Earnings Carry Markets Early

A jump in shares of McDonald’s before the opening bell helped set a strong tone for the Dow Jones Industrial Average the rest of the session. This impressed investors because the blue chip average had been treading water for nearly a week, while the S&P 500 and NASDAQ Indexes were posting record highs.

For the record, McDonald’s posted quarterly earnings and revenue that topped analysts’ expectations. The earnings report further revealed that global same-store sales grew 5.4% in the first quarter, more than the 3.4% increase analysts expected.

The big surprise was General Electric. The company reported better-than-expected first-quarter earnings Tuesday, fueling a 4.6% surge in shares. Positive guidance for 2019 also helped boost the stock price as it signaled the company was burning less-cash than expected.

Disappointing Alphabet Earnings Weigh on NASDAQ

While new money gravitated toward the Dow and S&P 500, a revenue miss by Google’s parent Alphabet weighed on overall investor sentiment, and especially the NASDAQ Composite.

Alphabet shares tumbled 7.5% Tuesday, posting its worst day since October 2012 after reporting revenue of $36.34 billion in the first quarter, versus $37.33 billion expected. The company said the weaker revenue was driven by the decelerating ad sales growth at Google.

Is the report a game-changer? No. JMP Securities analyst Ronald Josey said in a note, “we also believe there remain multiple monetization opportunities ahead.”

NASDAQ Regains Composure after Apple Beat

After posting a dismal performance during the regular trading session, the NASDAQ Composite posted an impressive turnaround following the closing bell after Apple reported strong guidance and a stock buyback.

Apple shares soared after the bell after the communications giant reported earnings for its March quarter fell in line with expectations. Revenue was also down from the same period last year. However, this wasn’t the story guiding prices higher in post-market trading. It was Apple’s guidance for next quarter and the announcement of a stock buyback that fueled the price spike.

Apple’s guidance for next quarter was higher than analysts expected, and it said it planned to spend $75 billion buying back its own shares. It also approved a 77 cent dividend per share, a 5% increase.