What’s happening: Shares of AT&T rose sharply on Monday, after the company reported its fourth-quarter results.
What happened: The US telecom giant reported better-than-expected sales and earnings for the latest quarter.
AT&T’s wireless subscriber growth in the fourth quarter topped market estimates, driven by demand for its discounted plans.
How were the results: The Dallas, Texas-based company reported low single-digit growth in revenues for the quarter.
Why it matters: AT&T combined its 5G mobile with high-speed fibre data, which provided a boost to the company’s overall growth. The final three months of the year are generally strong for major telecom companies due to Black Friday promotions, Christmas and trade-in deals for iPhone launches. These factors helping AT&T increase subscriber gains.
The company added 482,000 net postpaid wireless phone subscribers in the quarter, topping market expectations of 424,550. The company’s fibre business added 307,000 new subscribers, higher than the 226,000 gain in the previous quarter, to record its best fourth-quarter additions.
Although the company’s free cash flows declined to $4.8 billion, from $6.4 billion in the year-ago quarter, it came in-line with expectations.
CEO John Stankey said the company would begin share repurchases in the second half of the year.
Management guided to growth in consolidated service revenues in the low-single-digit range for fiscal 2025, and adjusted earnings between $1.97 and $2.07 per share.
How shares responded: AT&T’s shares climbed 6.3% to close at $24.14 on Monday, following the release of quarterly results. The stock has added around 28% over the past six months.
What to watch: Investors will continue monitoring new subscriber additions for the company, which are expected to significantly impact its overall results ahead.
Context: The EUR/USD forex pair fell this morning as investors monitored the European Central Bank’s monetary policy outlook.
Details: The EUR/USD hovered near the 1.05 level on Monday, its highest mark since December 16, ahead of several central bank meetings this week. However, the forex pair pared gains this morning.
The ECB is widely expected to cut its benchmark interest rate by 25 basis points at its meeting on Thursday. This would mark its fifth cut since interest rates hit over two-decade highs in late 2023. Investors will also monitor comments from policymakers for any insights into their plans for the rest of the year.
Meanwhile, the US Federal Reserve is projected to keep rates unchanged, while policymakers in Canada are expected to continue with monetary policy easing.
Strength in the US dollar exerted pressure on the EUR/USD forex pair. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained around 0.5% to 107.89 on Monday.
The EUR/USD fell around 0.5% to 1.0436 this morning, while the EUR/GBP forex pair slipped around 0.1% to 0.8384.
The STOXX Europe 600 Index lost 0.07% to close at 529.69 on Monday, with pressure on tech and industrial stocks.
What to watch: With no major economic data from the Eurozone scheduled for today, investors await the release of reports on loans to companies (1300 UAE Time), loans to households (1300 UAE Time) and M3 money supply (1300 UAE Time) on Wednesday. Loans to non-financial corporations in the Eurozone, which rose 1% year-over-year to €5.162 trillion in November, are expected to grow by 0.9% in December.
Analysts expect bank lending to households in the Eurozone to rise by 1% year-over-year in December, following a 0.9% gain in the previous month, while the M3 money supply is projected to increase by 3.8% year-over-year in December.
Other Markets: US trading indices closed mixed on Monday, with the S&P 500 and Nasdaq 100 down by 1.46% and 2.97%, respectively, and the Dow Jones index up by 0.65%.
Russian military troops claimed to have taken back control of a village in the Kursk border region from Ukraine. The news sent the RUB/USD pair higher in forex trading this morning.
Australia’s NAB business confidence index improved to -2 in December, from -3 in the previous month. However, this being the second consecutive month of a negative reading exerted pressure on the AUD/USD forex pair.
Brazil’s value of outstanding loans grew by 1.4% to R$6.4 trillion in December, compared to a 1% gain in the previous month, sending the BRL/USD pair higher in forex trading this morning.
Mexico’s trade surplus shrank to $2.6 billion in December, from $4.3 billion in the year-ago period, exerting pressure on the MXN/USD forex pair.
US sales of new single-family homes climbed by 3.6% to an annualised rate of 698,000 in December. The latest reading also topped market estimates of 670,000, which sent the Dow Jones index higher by more than 250 points on Monday.
Spain’s unemployment rate (1200 UAE Time), as well as US durable goods orders (1730 UAE Time), Redbook index (1755 UAE Time), S&P/Case-Shiller home price index (1800 UAE Time), FHFA house price index (1800 UAE Time), CB consumer confidence (1900 UAE Time), Richmond Fed manufacturing index (1900 UAE Time), Richmond Fed services revenues index (1900 UAE Time), Dallas Fed services index (1930 UAE Time), Dallas Fed services revenues index (1930 UAE Time) and money supply (2200 UAE Time).