For first time in a decade, U.S. companies could report lower profits on higher revenue

NEW YORK (Reuters) - Wall Street is bracing for large U.S. companies to report a decline in quarterly profits even after raking in higher revenues, something that has not happened in more than a decade.

S&P 500 companies due to report in the coming weeks face tough comparisons with last year, when the U.S. tax code overhaul helped boost profits by more than 20%.

But with rising costs, some resulting from tariffs, analysts see profit margins shrinking by 1.1 percentage point, the first year-over-year decline in at least two years, IBES data from Refinitiv showed.

“Companies are experiencing rising input costs as well as increases in labor costs from modestly rising wages,” said Kristina Hooper, chief global market strategist at Invesco in New York.

First-quarter earnings for S&P 500 companies are expected to fall 2.5% from a year earlier, which would mark the first quarterly U.S. decline since 2016. Revenue is meanwhile seen up 4.8%.

Costs for certain raw materials like aluminum have increased as the United States slapped tariffs on imports from China and other countries.

First-quarter earnings could be crucial to the bull market’s continued success, with some investors seeing them as the catalyst to either lift stocks to all-time highs or pour cold water on the rally.

Stocks have bounced back from a late-2018 selloff on optimism that the United State could seal a trade deal with China and expectations the Federal Reserve would not raise interest rates again any time soon.

Delta Air Lines Inc is due to report on Wednesday, while JPMorgan Chase & Co and Wells Fargo & Co report on Friday. Results from Netflix Inc and some big industrial names like Honeywell International Inc are expected next week.

DIVIDED OUTLOOK

The last time profits fell while revenue grew was the third quarter of 2008, in the depths of the financial crisis. Still, strategists appear divided on what the rest of the year holds for earnings.

It is also not unusual for S&P 500 companies to top analyst expectations.

Since 1994, S&P 500 earnings have beaten estimates by an average of 3.2%, based on Refinitiv data, and some strategists think the S&P 500 will end up posting growth for the first quarter.

And nearly 83% of earnings are beating analysts’ expectations so far this quarter, based on the 23 S&P 500 companies that have already reported.

>>6118247

https://www.reuters.com/article/us-usa-results-outlook-idUSKCN1RL2T5

Aramco’s new bonds inch up in early trade: sources

DUBAI (Reuters) – Saudi Aramco’s newly issued dollar-denominated bonds inched up on Wednesday, with longer-dated paper outperforming, sources familiar with the matter said.

The company on Tuesday issued $12 billion worth of paper, disappointing much of the over $100 billion in demand.

Of the five tranches, the $3 billion 30-year bonds were the best performers, up by slightly over 1 cent, the sources said, while shorter-dated paper made more modest gains.

The sources said there would be a clearer picture of the bonds’ performance once markets in London and New York open later on Wednesday.

https://www.oann.com/aramcos-new-bonds-inch-up-in-early-trade-sources/

>>6118372

Ghosn warns Nissan will fail after 'dirty game' to oust him

(dragging this out for too long-just jail him and throw the key's away)

TOKYO – Carlos Ghosn has accused Nissan Motor executives of sacrificing the interests of the company by playing a "dirty game" to oust him as chairman, in a video statement recorded the day before he was arrested for the fourth time in Tokyo last week.

Although the former Nissan chairman originally cited the names of some executives who planned what he claims was a conspiracy against him, his defense team decided to cut them out of the video in a bid to remove legal risks, his lawyer said.

"I'm worried, because the performance of Nissan is declining and I don't think there is vision for the alliance being built," Ghosn said in the seven-minute video, which was made public by his defense lawyers on Tuesday.

Dressed in a suit and white shirt, Ghosn spoke calmly in the video and, while he did not mention any Nissan executives by name in his accusations, he was scathing about the direction the company was taking.

"Frankly, sitting around a table being consensual about a decision, this is not a vision in an industry as competitive as the car industry," he continued, describing Nissan's recent performance as "absolutely mediocre" and pointing to a decline in the share price. The stock price has declined about 7% since Ghosn was first arrested last November.

"You need to show the future," Ghosn continued. "People who say [leaderships is] either consensus or dictatorship, they don't know what leadership is about."April 09, 2019 15:16 JST Updated on April 09, 2019 19:56 JST

Former Nissan Chairman Carlos Ghosn speaks in a video released by his defense lawyers on April 9. (Courtesy of Ghosn's legal team)

TOKYO – Carlos Ghosn has accused Nissan Motor executives of sacrificing the interests of the company by playing a "dirty game" to oust him as chairman, in a video statement recorded the day before he was arrested for the fourth time in Tokyo last week.

Although the former Nissan chairman originally cited the names of some executives who planned what he claims was a conspiracy against him, his defense team decided to cut them out of the video in a bid to remove legal risks, his lawyer said.

"I'm worried, because the performance of Nissan is declining and I don't think there is vision for the alliance being built," Ghosn said in the seven-minute video, which was made public by his defense lawyers on Tuesday.

Dressed in a suit and white shirt, Ghosn spoke calmly in the video and, while he did not mention any Nissan executives by name in his accusations, he was scathing about the direction the company was taking.

"Frankly, sitting around a table being consensual about a decision, this is not a vision in an industry as competitive as the car industry," he continued, describing Nissan's recent performance as "absolutely mediocre" and pointing to a decline in the share price. The stock price has declined about 7% since Ghosn was first arrested last November.

"You need to show the future," Ghosn continued. "People who say [leaderships is] either consensus or dictatorship, they don't know what leadership is about."

Ghosn said this "plot" was driven by "a few executives, who for their own interest and selfish fears, are creating a lot value destruction."

"Names? You know them. We are talking about people who played a very dirty game."

The remarks were Ghosn's boldest criticism against Nissan since his arrest in November. Nissan formally ended its 19-year relationship with the former executive when it voted to remove him from its board at an extraordinary shareholders meeting on Monday. Ghosn was rearrested for the fourth time last Thursday on fresh allegations of improperly using company funds, this time allegedly to pay an Omani distributor for his own benefit.

The Brazilian-born tycoon wrote on Twitter the day before his rearrest that he had planned to hold a press conference on April 11 to make his case. However, as a Tokyo court approved a request by prosecutors to detain him for 10 days for further questioning, the plan for the conference was no longer possible.

Ghosn had recorded the video message, "fearing prosecutors might hinder him from holding the press conference," according to Junichiro Hironaka, one of Ghosn's defense lawyers on Tuesday.

https://asia.nikkei.com/Business/Nissan-s-Ghosn-crisis/Ghosn-warns-Nissan-will-fail-after-dirty-game-to-oust-him

>>6118421

ty for update