Gold Inches Higher As Investors Await Fed Outcome

Gold prices edged higher on Wednesday and the dollar traded weak as investors braced for the Federal Reserve’s interest-rate decision later in the day.

Spot gold rose 0.4 percent to $1,971.79 per ounce, while U.S. gold futures were up half a percent at $1,972.95.

A 25-bps rate hike is fully priced in, with investors waiting to see whether there will be a tilt towards dovishness around the inflation rhetoric.

Some economists believe that today’s rate hike will be the last following recent encouraging inflation data.

They expect today’s rate-hike announcement to mark the end of the rate-hiking cycle, followed by a series of aggressive rate cuts next year.

Elsewhere, the European Central Bank’s policy announcement is due on Thursday, while the Bank of Japan is scheduled to announce its rate decision on Friday.

The ECB is also expected to lift rates by 25 basis points, but the odds for September continue to diminish due to concerns over slowing growth.

The BOJ is likely to maintain its ultra-dovish stance.

Old Dominion Freight Line, Inc. Q2 income drops in line with estimates

Old Dominion Freight Line, Inc. (ODFL) announced earnings for second quarter that decreased from the same period last year in line with the Street estimates.

The company’s bottom line came in at $292.36 million, or $2.65 per share. This compares with $376.08 million, or $3.30 per share, in last year’s second quarter.

Analysts on average had expected the company to earn $2.65 per share, according to figures compiled by Thomson Reuters. Analysts’ estimates typically exclude special items.

The company’s revenue for the quarter fell 15.6% to $1.41 billion from $1.67 billion last year.

Old Dominion Freight Line, Inc. earnings at a glance (GAAP) :

-Earnings (Q2): $292.36 Mln. vs. $376.08 Mln. last year.
-EPS (Q2): $2.65 vs. $3.30 last year.
-Analyst Estimates: $2.65
-Revenue (Q2): $1.41 Bln vs. $1.67 Bln last year.

Teleflex To Acquire Palette Life Sciences AB – Quick Facts

Teleflex Incorporated (TFX) has entered into a definitive agreement to acquire Palette Life Sciences AB for an upfront cash payment of $600 million at closing, and up to an additional $50 million upon the achievement of certain commercial milestones.

A key product of Palette Life Sciences is Barrigel, a NASHA spacer designed to reduce radiation delivered to the rectum during prostate cancer radiation therapy. Barrigel received FDA marketing clearance in May 2022, is cleared for marketing in Australia, and is CE Marked. The Palette portfolio also includes Deflux and Solesta, which are NASHA based tissue bulking agents designed to treat pediatric vesicoureteral reflux and fecal incontinence, respectively.

Teleflex expects the acquisition to be dilutive to adjusted earnings per share in 2023 and 2024 by approximately $0.15 and $0.35, respectively. Beginning in fiscal 2025, and thereafter, the company expects the acquisition to be increasingly accretive to adjusted earnings per share.

Palette is estimated to generate net sales of approximately $56 million, on a standalone basis, in 2023. Assuming a December 1, 2023 close of the transaction, the acquisition is not expected to significantly impact the company’s 2023 revenue.

“In 2024, we expect this business will achieve year-over-year revenue growth in the high-teens to low 20% range, which gives us further confidence in our ability to deliver on our 2023-2025 LRP financial objectives,” said Liam Kelly, CEO of Teleflex.

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Healthcare Services Group Profit Advances In Q2, but misses estimates

Healthcare Services Group (HCSG) announced earnings for its second quarter that increased from last year but missed the Street estimates.

The company’s bottom line totaled $8.598 million, or $0.12 per share. This compares with $6.820 million, or $0.09 per share, in last year’s second quarter.

Analysts on average had expected the company to earn $0.17 per share, according to figures compiled by Thomson Reuters. Analysts’ estimates typically exclude special items.

The company’s revenue for the quarter fell 1.4% to $418.931 million from $424.857 million last year.

Healthcare Services Group earnings at a glance (GAAP) :

-Earnings (Q2): $8.598 Mln. vs. $6.820 Mln. last year.
-EPS (Q2): $0.12 vs. $0.09 last year.
-Analyst Estimate: $0.17
-Revenue (Q2): $418.931 Mln vs. $424.857 Mln last year.

Quest Diagnostics Boosts FY23 Adj. EPS, Revenue Outlook – Update

While reporting financial results for the second quarter on Wednesday, Quest Diagnostics Inc. (DGX) raised its adjusted earnings and revenue guidance for the full-year 2023.

For fiscal 2023, the company now projects earnings in a range of $7.52 to $7.92 per share and adjusted earnings in a range of $8.50 to $8.90 per share on net revenues between $9.12 billion and $9.22 billion.

Previously, the company expected earnings in the range of $7.52 to $8.02 per share and adjusted earnings in the range of $8.45 to $8.95 per share on net revenues between $8.93 billion and $9.08 billion.

On average, analysts polled by Thomson Reuters expect the company to report earnings of $8.69 per share on revenues of $9.06 billion for the year. Analysts’ estimates typically exclude special items.

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Oil Prices Decline After Crude Build

Oil prices fell on Wednesday after industry data showed a rise in U.S. crude inventories, suggesting that supplies were not as tight as previously expected.

Profit taking after recent strong gains and the lack of details on China’s stimulus measures also weighed on prices.

Brent crude futures were down 0.8 percent at $82.62 a barrel, while WTI crude futures were down 0.8 percent at $78.98.

Prices were coming under pressure after data from the American Petroleum Institute showed U.S. crude stocks rose by about 1.3 million barrels in the week that ended on July 21, denting optimism about the world’s economic recovery.

Official inventory data from the Energy Information Administration will be released later in the day.

The dollar was on the back foot in European trade, after having hit a two-week high.

The Federal Reserve is scheduled to announce its interest-rate decision later today, with economists expecting a 25-bps hike to fight inflation.

Comments from Fed Chair Jerome Powell on inflation and the future trajectory of interest rates will be crucial to watch for.

The European Central Bank and the Bank of Japan are scheduled to announce their interest rate decisions on Thursday and Friday, respectively.