Blinken Meets with Lavrov in Effort to Prevent Russian Invasion of Ukraine

US Secretary of State Antony Blinken on Friday told his Russian counterpart Foreign Minister Sergey Lavrov that Russia can defuse tensions and concerns about a potential invasion by removing an extraordinary deployment of troops and equipment away from Ukraine's border. But Russia urged the US to prevent an eastward expansion of NATO. Blinken told reporters after the meeting with Lavrov in Geneva: "We and all of our allies and partners are equally committed to making sure we are doing everything possible to make clear to Russia that there will be a swift, severe and united response to any form of aggression by Russia directed to Ukraine." He added the US is not persuaded by Russia's claim that it is not preparing for an invasion of its neighbor. The meeting between Blinken and Lavrov came as Western officials including President Joe Biden have said they expect Russia will launch an invasion into Ukraine. US intelligence has predicted Russia could attack within a month.

Peloton & Rio Tinto Move on News

Today shares of fitness firm Peloton Interactive (NASDAQ: PTON) and Anglo-Australian mining firm Rio Tinto (OTC: RTNTF) are both moving on news updates. Peloton said Friday that it is currently reviewing production levels and considering implementing layoffs, one day after CNBC reported it is halting production of its bike and treadmill products due to cost controls and oversupply in warehouses and cargo ships. Serbia revoked Rio Tinto's lithium exploration licenses and canceled the firm's $2.4 billion Jadar project, which it planned to start in 2027. The European country's leaders explained the decision came after opposition from environmental groups. Rio had aimed to become one of the top global producers of lithium, a key component in batteries. The Australian government responded that it regrets Serbia's decision against the miner. In the afternoon, Peloton shares soared 13.3%, and Rio Tinto ADR shares rose 3.1%.

US Banks Closed Record Number of Retail Branches in 2021

US financial institutions closed a record number of retail branches in 2021 as customers increasingly turn to digital banking and the banking industry consolidates. US banks closed 2,927 total branches on net last year, according to S&P Global Market Intelligence data released Friday. The analysis found that banks shuttered almost 4,000 branches and opened over 1,000 branches. Gerard Cassidy, head of US bank equity strategy at RBC Capital Markets (NYSE: RY), told CNBC: "We anticipate that the downward trend in branches will continue for a number of years … as more of the transaction-orientated aspects of banking are done digitally." The closures also come as banks consolidate, with deals in the space reaching $77 billion in 2021, the highest since 2006. Wells Fargo (NYSE: WFC) closed the most branches in 2021, closing on net 267 retail locations. JPMorgan Chase (NYSE: JPM) was the sixth biggest net branch closer last year and also opened the most branches with 169 new locations.

US Sanctions Chinese Firms for Missile Technology Proliferation

The US State Department on Friday announced sanctions against the China Aerospace Science and Technology Corporation First Academy, the China Aerospace Science and Technology Corporation Fourth Academy, and Poly Technologies Incorporated over allegations of "missile technology proliferation." The new sanctions apply to the firms and their subsidiaries, meaning that those entities cannot contract with the US government and their technology cannot be imported into the US. The companies accused of are also not allowed to obtain any US technologies. China later criticized the US for imposing "hegemonic" sanctions on the Chinese firms: "This is a typical hegemonic action. China strongly deplores and firmly opposes it." China's Foreign Ministry urged the US to "immediately correct its mistakes, revoke the relevant sanctions, and stop suppressing Chinese enterprises and smearing China." The Ministry argued that China strictly controls its exports of missiles, avoiding proliferation.

IMF Warns Fed Rate Hike Could Harm Global Recovery

International Monetary Fund managing director Kristalina Georgieva said the US Federal Reserve's interest rate hikes could "throw cold water" on weak economic recoveries in certain countries. Speaking via videoconference at The Davos Agenda virtual event Friday, she said an increase in US rates could have significant implications for countries with higher levels of dollar-denominated debt. Georgieva noted is it "hugely important" that the Fed clearly communicate its plans to prevent surprises for foreign countries. Georgieva added the IMF's message to countries with high levels of dollar-denominated debt is: "Act now. If you can extend maturities, please do it. If you have currency mismatches, now is the moment to address them." Georgieva also noted her biggest concern is for low-income countries with high levels of dollar-denominated debt, highlighting that two-thirds are currently in or at risk of debt distress. Higher US interest rates will likely make it more expensive for countries to service their dollar-denominated debt.

Crypto Assets Tumble to New Lows

The prices of crypto assets fell sharply on Friday, wiping off nearly $150 billion from the crypto market. Bitcoin's (BTC) price plunged about 10% and was trading near $38,425 in the morning, according to Coin Metrics. The price of Ether (ETH) plummeted over 12% to $2,807 apiece. The declines in cryptocurrencies follow Wall Street's losses Thursday, after the Nasdaq Composite (.IXIC) was down almost 5% this week, and the S&P 500 (.INX) is in its third straight week of losses. As the 10-year US Treasury bond yield spiked earlier this week, rising rates have spurred global investors to shed their positions in riskier assets like crypto. Many analysts are arguing the risk is that a more hawkish Federal Reserve may hinder crypto's momentum. Other experts warn of a crypto downturn due to heightened regulatory scrutiny and intense price volatility. Bitcoin's price has cratered since November, down over 40% from a record high of about $69,000 and nearing the low of last year.

Schlumberger Beats on Earnings

Schlumberger NV (NYSE: SLB) reported fourth quarter and full year earnings today before the bell, and in the afternoon its stock has slipped 1.85% to $36.35 on the earnings beat. The oilfield services firm posted net income of $601 million, up 61% from $374 million in the prior year period, or GAAP earnings per share of 42 cents, up from 27 cents. Schlumberger posted adjusted earnings per share of 41 cents, up from 22 cents and beating consensus estimates of 39 cents. The firm posted revenue of $6.22 billion, up 12.5% and beating estimates by $130 million. Free cash flow was $1.30 billion. For the full year, the firm reported net income of $1.881 billion, up from a net loss of $10.52 billion. Chief executive Olivier Le Peuch said the firm concluded the year with great momentum thanks to strengthening activity, outstanding free cash flow, and accelerating digital sales.

IHS Markit Beats on Earnings

IHS Markit (NYSE: INFO) reported fourth quarter and full year earnings today before the bell, and in the afternoon its stock has edged up 0.35% to $118.35 on the earnings beat. The information services firm posted net income of $737 million, up 388% from $151.1 million in the prior year period, or GAAP earnings per share of $1.83, up from 38 cents. IHS Markit posted adjusted earnings per share of 85 cents, up from 72 cents and beating consensus estimates of 84 cents. The firm posted revenue of $1.18 billion, up 6.3% and beating consensus estimates by $40 million. For the full year, the firm reported net income of $1.207 billion. Chief executive Lance Uggla said the firm enjoyed a great conclusion to the year after reaching record organic revenue growth and entered 2022 with strong momentum across its businesses.

Huntington Falls Despite Earnings Beat

Huntington Bancshares (NASDAQ: HBAN) reported fourth quarter and full year earnings today before the bell, and in the afternoon its stock has fallen 9% to $15.18 despite the earnings beat. The bank holding company posted net income of $401 million, up from $316 million in the prior year period, or GAAP earnings per share of 26 cents, down from 27 cents. Huntington posted adjusted earnings per share of 36 cents, beating consensus estimates of 35 cents. The firm posted revenue of $1.65 billion, up 33.1% and missing consensus estimates by $40 million. For the full year, the firm reported net income of $1.3 billion, up 59%. Total loans rose $1.4 billion or 1% to $111.9 billion. Chief executive Steve Steinour said the firm is pleased with its performance and enters 2022 increasingly confident in its outlook.

Ally Beats on Earnings

Ally Financial (NYSE: ALLY) reported fourth quarter and full year earnings today before the bell, and in the afternoon its stock has fallen 3.8% to $47.12 on the earnings beat. The financial institution posted net income of $652 million, down from $687 million in the prior year period, or GAAP earnings per share of $1.79, up from $1.82. Ally posted adjusted earnings per share of $2.02, up from $1.60 and beating consensus estimates of $1.97. The firm posted revenue of $2.2 billion, up 10.0% and beating estimates by $130 million. For the full year, the firm reported net income of $3.1 billion, up from $1.085 billion. Adjusted tangible book value per share rose 7% to $38.73, and retail deposits grew $3.1 billion quarterly. Chief executive Jeffrey Brown said the firm strengthened its position as a leading disruptive growth company, delivering record-setting results.

First Hawaiian Beats on Earnings

First Hawaiian (NASDAQ: FHB) reported fourth quarter and full year earnings today before the bell, and at midday its stock has risen 1.85% to $29.54 on the earnings beat. The bank holding company posted net income of $57.0 million, down from $61.7 million in the prior year period, or GAAP earnings per share of 44 cents, down from 47 cents. First Hawaiian posted adjusted earnings per share of 53 cents, up from 50 cents and easily beating consensus estimates of 47 cents. The firm posted revenue of $178.9 million, down 5.3% and beating consensus estimates by $20.49 million. For the full year, the firm reported net income of $ . Total loans rose 1.0% quarterly to $13.0 billion, and total deposits dipped 1.8% to $21.8 billion. Chief executive Bob Harrison said the firm is pleased to report that it completed 2021 with a solid fourth quarter amid strong loan growth and excellent credit quality.

Netflix Craters on Subscribers Despite Earnings Beat

Netflix (NASDAQ: NFLX) reported fourth quarter and full year earnings yesterday after the bell, and today at midday its stock has cratered almost 21% to $402 despite the earnings beat. The entertainment streaming giant posted net income of $607.4 million, up from $542.2 million in the prior year period. Netflix posted GAAP earnings per share of $1.33, up from $1.19 and easily beating consensus estimates of 83 cents. The firm posted revenue of $7.71 billion, up 16.1% and in line with consensus estimates. Operating income soared 35% to $6.2 billion rose 35%. For the full year, the firm reported net income of $5.116 billion. The firm added 8.3 million paid members quarterly to reach 222 million total, missing estimates of 8.32 million. Looking ahead to the first quarter of 2022, Netflix sees net income of $1.30 billion on revenue of $7.90 billion. Baird and KeyBanc (NYSE: EY) downgraded Netflix, and several institutions cut their price targets.

Intuitive Surgical Falls Despite Earnings Beat

Intuitive Surgical (NASDAQ: ISRG) reported fourth quarter and full year earnings yesterday after the bell, and today at midday its stock has fallen 7.1% to $271.90 despite the earnings beat. The medical technology firm posted net income of $381 million, up from $365 million in the prior year period, or GAAP earnings per share of $1.04, up from $1.10. Intuitive Surgical posted adjusted net income of $477 million or earnings per share of $1.30, up from $1.19 and beating consensus estimates of $1.28. The firm posted revenue of $1.55 billion, up 16.5% and beating consensus estimates by $10 million. The firm shipped 385 da Vinci Surgical Systems, up 18%. For the full year, the firm reported net income of $1.70 billion. Citigroup (NYSE: C) upgraded Intuitive Surgical from hold to buy after the earnings beat.

CSX Beats on Earnings

CSX Corporation (NASDAQ: CSX) reported fourth quarter and full year earnings yesterday after the bell, and today at midday its stock has slipped 2.45% to $34.38 on the earnings beat. The railroad transportation and real estate firm posted net income of $934 million, up 23% from $760 million in the prior year period. CSX posted GAAP earnings per share of 42 cents, up 27% from 33 cents and in line with consensus estimates. The firm posted revenue of $3.43 billion, up 21.2% from $2.825 billion and beating consensus estimates by $110 million. For the full year, the firm reported net income of $3.781 billion. Cash and equivalents fell $890 million to $2.239 billion. Chief executive James Foote said the firm has been working hard amidst the ongoing impacts of the pandemic and persistent global supply chain disruptions.

SVB Financial Falls on Mixed Earnings

SVB Financial Group (NASDAQ: SIVB) reported fourth quarter and full year earnings yesterday after the bell, and today at midday its stock has fallen 5.3% to $613.55 on the mixed earnings. The financial institution posted net income of $371 million, down from $388 million in the prior year period. SVB posted GAAP earnings per share of $6.22, down from $7.40 and missing consensus estimates of $6.44. The firm posted revenue of $1.5 billion, up 24.0% and beating consensus estimates by $50 million. For the full year, the firm reported net income of $1.8 billion, up from $1.2 billion. Total loans jumped 7.8% to $66.3 billion, and total deposits rose to $189.2 billion. Chief executive Greg Becker said the firm is starting 2022 on strong footing with vibrant client markets, despite ongoing pandemic-related challenges and inflation concerns.

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