Diamonds and Dogs
Defense stocks take the spotlight again as Raytheon (RTN) is up 2%, Northrop (NOC) and Lockheed (LMT) are both up a percent as intensely aggressive rhetoric between the U.S. and North Korea further throttles global stability. On the 72nd anniversary of the US dropping a second atomic bomb on Japan, devastating the city of Nagasaki, President Trump made threatening comments to North Korea.
The mouse house is trading lower. Disney (DIS) is down 4% as earnings beat, but sales fell 0.3% year/year to $14.24 billion missing estimates. Media revenue dropped a percent while operating income fell 22% to $1.8 billion. Cable Networks revenues for the quarter decreased 3% to $4.1 billion as operating income decreased 23% to $1.5 billion. ESPN remains the main culprit in the cable business. Going forward, Disney will launch ESPN brand video streaming service early next year and Disney brand DTC service in 2019, ending distribution agreement with Netflix (NFLX) in 2019.