Morning business news - July 23

Wednesday 23 July 2014 09.09
Morning business news - July 23
Morning business news - July 23

Second quarter results were out from some big hitters internationally over the last 24 hours, with two big tech firms and two more traditional names reporting.

Mark Murnane of ETX Capital said results from Apple were in line all round.

"The new CEO, Tim Cook, has been trying to bring in steady numbers and take the expectation away from massive growth. He's trying to slow it down and look at it as a solid company that returns capital to shareholders and with these results he's done that," he said.

He points out that Apple has been looking to China for its growth and with iPhone sales up 48%, it got that.

"If there was to be a negative or something below expectations it was iPad sales, which were a little disappointing, showing potentially that the tablet market is saturated."

Mark Murnane said Microsoft's results were better than expected when the acquisition of Nokia's handset division was taken out.

"It's looking at cloud infrastructure as a way to grow its business. It's also looking at phones. The business is doing well, but perhaps not as well as some of their peers."

Coca-Cola and McDonald’s put in some disappointing results, perhaps as a function of investors concentrating less on the more traditional stocks and a change in eating trends affecting both companies, Mark Murnane suggested.

He pointed out that investors were focusing closely on this quarter's results all round as the spotlight comes off the tapering of stimulus and moves onto the performance of the economy as a whole.

"Markets are back at record highs. People are looking beyond the end of the stimulus that was pumped into the economy and more towards how companies are doing and how management expect things to go when QE ends," he concluded.

+++ Apple has reported profits of $7.75 billion for the three months to the end of June - up 12% on the same period last year.

That was on the back of impressive iPhone sales - over 35 million sold between March and June - a 13% increase on the same period last year.

The company is seeing strong growth in BRICS countries - Brazil, Russia, India, South Africa, and especially China where iPhone sales rose by 48%.

iPad sales were disappointing however with the number of units sold down for a second quarter.

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Russia cancelled a scheduled bond auction yesterday - its first in three months - citing unfavourable market conditions.

Russia's borrowing costs stand at about 4.5% for five year debt.

It's already high but it's getting worse as the crisis in Ukraine escalates and talk of further sanctions intensifies.

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Argentinean negotiators have been ordered into an intense round of negotiations with so-called 'hold out' investors who want to be paid all they're owed by the country which is on the brink of defaulting again.

Argentina defaulted in 2001 but entered into a deal with the majority of its creditors on a restructuring arrangement that would see them taking substantial losses.

However this group want all their money and they won a Supreme Court battle to get it - Buenos Aires can't pay any of the creditors until it agrees a deal with the hold-outs.

A US judge has told them to meet continuously from today to hammer out a resolution before the July 30th deadline.

The country technically defaulted at the end of June but it was given a stay of 30 days which expires next week.

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Back home and 40 new jobs have been promised for Cork before the end of the year by a US-based IT company, Itron Incorporated. 

It's establishing a global business services centre in the city, backed by IDA Ireland.

The jobs are in accounting and finance operations.