The stock market rally moved sideways on Tuesday, with UPS, Pulte Group, and Crocs, leading notable earnings winners while Tesla retreated. Google parent Alphabet, Microsoft stock, AMD, Pinterest, Visa, Starbucks were notable after-hours earnings reports.
The major averages traded around the flatline. The Dow Jones Industrial Average rose just 3 points. The S&P 500 closed flat after notching an all-time high on Monday. The Nasdaq Composite was the relative underperformer, dipping 0.34% as Tesla fell 4.5%.
Google reported better than expected earnings after the bell on Tuesday, sending shares of the tech giant up more than 4% in after-hours trading. Alphabet saw its revenues grow 34% from a year ago.
The stock of Microsoft dipped about 3% in extended trading even after the company topped analyst earnings. Microsoft had its largest revenue growth since 2018, thanks in part to gains in PC sales resulting from COVID -driven shortages last year.
Crocs shares shot up over 16% following the rise of its 2021 revenue outlook as well as positive first-quarter sales. Amid the pandemic, the shoemaker experienced its best sales to date, as people searched for comfort while in lockdown.
Crocs earnings amounted to $ 1.49 per share, compared to the expected $ 0.89 a share. Revenue totaled $460.1 Million, higher than analysts anticipated $ 415 Million.
Crocs witnessed a 75.3% increase in digital sales, totaling 32.3% of revenue. Moreover, direct-to-consumer sales from stores or the website rose 93.3% to USD170.1 Million.
“Looking forward, we remain focused on strategically important accounts comprised of leading e-tailers, sporting goods, and family footwear and specialty footwear retailers,” CEO Andrew Rees said.
Crocs shares have surged over 260% within the last year and have a current market cap of USD5.5 Billion.
Meanwhile, President Biden is expected to pitch a higher capital gains tax this week to raise funds for his economic agenda. But the policy would lose the U.S. billions in revenue if it doesn’t also scrap a tax break for heirs, according to experts.
Biden’s plan is expected to call for a 39.6% top tax rate on long-term capital gains, up from the current 20%. The tax would apply to returns on assets held for more than a year and to taxpayers with more than $1 million in income.
Raising taxes on capital gains means people who earn more than $1 million a year may opt to hold investments longer — and bequeath them to heirs tax-free — as a tax avoidance strategy.
About 540,000 individuals, which is 0.3% of people had reported income over $ I million in 2018, meaning they’d be subject to the expected tax increase, according to recent IRS data.
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