Coca-Cola’s shares surge on earnings beat

Today’s headlines

What’s happening: Shares of Coca-Cola Company rose on Tuesday after the company released its first-quarter results.

What happened: The beverage maker posted better-than-expected sales and earnings for the latest quarter.

Coca-Cola also raised its annual profit outlook despite the ongoing macro uncertainty.

How were the results: The Atlanta, Georgia-based company reported low single-digit sales growth for the latest quarter.

• Sales surged 12% year-over-year to $12.5 billion, beating consensus estimates of $12.24 billion.
• Adjusted earnings came in at 86 cents per share, topping Wall Street expectations of 81 cents per share.

Why it matters: Coca-Cola said organic revenues climbed 10%, following 8% growth in concentrate sales and a 2% rise in price/mix. Comparable operating margin expanded to 34.5% from 33.8% in the year-ago period, while comparable currency-neutral operating income surged 12% during the quarter.

The recent rise in energy prices has resulted in higher input costs, mainly for packaging materials like aluminium. The company is also facing a shortage of aluminium cans in India, weighing on the supply of Diet Coke cans due to a delay in shipments from the Gulf.

Most consumer firms warned of a hit to their earnings due to ‌the US-Iran war. Coca-Cola bucked the overall market trend by raising its annual profit forecast, expecting strong demand for its sodas and other beverages.

Coca-Cola raised its 2026 comparable earnings growth guidance to 8%-9%, from its previous forecast of 7%-8%. The company reaffirmed its 2026 organic revenue growth forecast of 4%-5%.

“Notwithstanding volatility in certain commodities like tea and coffee, we believe the overall impact on our cost basket is manageable at this time,” CFO John Murphy said.

How shares responded: Coca-Cola’s shares rose 3.9% to close at $78.35 on Tuesday following the release of quarterly results. The stock has jumped more than 13% year to date.

What to watch: Investors will keep an eye on developments around peace talks between the US and Iran and the reopening of the Strait of Hormuz.

The markets today

The Australian dollar in focus today ahead of a basket of major economic reports

Context: The AUD/USD forex pair traded lower this morning as investors digested the latest inflation data.

Details: Data released this morning showed that Australia’s annual inflation rate accelerated to 4.6% in March, from 3.7% in the previous month. Although the rate remained above the central bank’s 2%-3% target range, the latest reading came in below market estimates of 4.8%.

Goods inflation accelerated during the month, with a sharp rise in transport costs amid higher crude oil prices due to the Middle East conflict.

The sharp rise in inflation increased speculations of an interest rate hike of 25 basis points by the Reserve Bank of Australia next week.

Meanwhile, policymakers in the US and other G-7 economies are expected to keep rates unchanged this week while assessing the risk of higher energy costs with the Strait of Hormuz remaining effectively closed.

Strength in the US dollar exerted pressure on the AUD/USD forex pair this morning. The US dollar index, which measures the greenback’s performance versus a basket of major peers, edged higher to 98.65.

The AUD/USD pair fell around 0.3% to 0.7161 this morning, while the S&P/ASX 200 shed 0.26% to trade at 8,688.00.

What to watch: Investors will continue monitoring developments related to the US-Iran war.

Data on export prices (0530 UAE Time), import prices (0530 UAE Time) and private sector credit (0530 UAE Time) will be released on Thursday. Australia’s export prices, which rose by 3.2% in the fourth quarter, are expected to climb by 1% in the first quarter. Analysts expect Australia’s import prices to rise by 0.7% in the first quarter following a 0.9% increase in the previous quarter. Australia’s private sector credit, which surged by 0.6% in February, is expected to rise by 0.5% in March.

Other Markets: European indices closed mostly lower on Tuesday, with the DAX 40, CAC 40 and STOXX Europe 600 Index down by 0.27%, 0.46% and 0.37%, respectively, and the FTSE 100 up by 0.11%.

The news shaping the markets

Ukraine targeted Russia’s Tuapse refinery for the third time in less than two weeks. The news sent the USD/RUB pair higher in forex trading this morning.

India’s industrial production rose by 4.1% year-over-year in March. This being a deceleration from the previous month’s 5.1% growth lent support to the USD/INR forex pair.

Chile’s central bank held its policy rate at 4.5% in April, citing continued global uncertainty, which sent the USD/CLP pair higher in forex trading this morning.

Ireland’s wholesale prices declined by 0.2% year-over-year in March, following a 5.5% decline in the previous month, which exerted pressure on the EUR/USD forex pair.

Hong Kong’s trade deficit expanded to $89.1 billion in March from $45.4 billion in the year-ago month. This being the largest deficit since records started in January 1952 lent support to the USD/HKD pair in forex trading this morning.

What else to watch today

Eurozone’s loans to companies (1200 UAE Time), loans to households (1200 UAE Time), economic sentiment (1300 UAE Time), consumer confidence (1300 UAE Time), consumer inflation expectations (1300 UAE Time) and industrial sentiment (1300 UAE Time), Italy’s business confidence (1200 UAE Time) and consumer confidence (1200 UAE Time), Germany’s inflation rate (1600 UAE Time), Spain’s business confidence (1400 UAE Time), Brazil’s IGP-M inflation (1500 UAE Time), PPI (1600 UAE Time), US MBA mortgage applications (1500 UAE Time), building permits (1630 UAE Time), durable goods orders (1630 UAE Time), housing starts (1630 UAE Time), goods trade balance (1630 UAE Time), retail inventories (1630 UAE Time), wholesale inventories (1630 UAE Time), non-defence goods orders (1630 UAE Time), EIA crude oil stocks change (1830 UAE Time) and Fed interest rate decision (2200 UAE Time), Bank of Canada’s interest rate decision (1745 UAE Time), as well as Russia’s unemployment rate (2000 UAE Time), business confidence (2000 UAE Time), corporate profits (2000 UAE Time), real wage growth (2000 UAE Time) and retail sales (2000 UAE Time).