3M (MMM) released its third quarter earnings report on Tuesday, October 22. 3M posted better-than-expected sales for the quarter, resulting in its shares rising by 3.8% in premarket trading.

Net sales for the quarter came in at $6.29 billion. This was up slightly from $6.27 billion during the same quarter last year and ahead of analysts estimated quarterly sales of $6.06 billion.

“The 3M team delivered another quarter of strong operational execution, resulting in a double-digit increase in adjusted earnings along with solid adjusted free cash flow generation," said 3M CEO, William Brown. “Our ongoing execution positions us well to deliver a strong finish to the year. I am confident that our work on advancing our three priorities – organic growth, operational excellence, and capital deployment – will deliver long-term value creation for our shareholders.”

3M posted net income of $1.37 billion or $2.48 per adjusted share for the quarter. Last year at this time, the company posted a net loss of $2.08 billion or $3.74 per adjusted share.

The company’s Safety and Industrial segment reported sales of $2.77 billion during the quarter, up from $2.75 billion during the same period the prior year. Sales in the Transportation and Electronics segment reached $2.14 billion, down from $2.17 billion one year ago. The Consumer segment posted sales of $1.30 billion, down from $1.32 billion in the year prior. With the spin-off of Solventum, 3M eliminated reporting for its former Health Care business segment. 3M updated their full-year 2024 earnings outlook and expects sales growth of 1%, differing from its previous forecast ranging from flat to growth of 2.0%.

3M (MMM) shares ended the week at $124.75, down 7.9% for the week.

General Motors Drives Up Earnings

General Motors Company (GM) reported third quarter earnings on Tuesday, October 22. The automaker’s stock rose 9% after reporting revenue that exceeded earnings estimates. 

General Motors announced revenue of $48.76 billion for the quarter, up 10.5% from $44.13 billion at this time last year. Revenue beat analysts’ expectations of $44.59 billion.

“Today’s third quarter earnings announcement caps an eventful month for GM,” said General Motors CEO, Mary Barra in a letter to shareholders. “In the third quarter, we grew U.S. retail market share with above-average pricing, well-managed inventories and below-average incentives. I am proud that GM is delivering our best vehicles ever with strong financial results.”

General Motors reported quarterly net income of $3.06 billion or $2.96 per adjusted share. This was relatively unchanged from $3.06 billion or $2.28 per adjusted share during the same quarter last year.

The automotive manufacturing company’s North America segment saw third quarter revenue increase to $41.16 billion, up from $36.11 billion year-over-year. General Motors’ international segment reported revenue of $3.52 billion, down from $4.33 billion in the prior year. General Motors revised its full-year guidance for fiscal 2024 and expects income between $10.4 billion to $11.1 billion as compared to previous guidance of $10.0 billion to $11.4 billion.

General Motors Company (GM) shares ended the week at $52.07, up 5.8% for the week.

Boeing’s Earnings Report Released

Boeing Company (BA) announced third quarter earnings on Wednesday, October 23. The aircraft manufacturer reported revenue that missed expectations, causing the company’s shares to fall 2.8% after the release of the report.

Boeing reported quarterly net revenue of $17.84 billion, below analysts’ estimates of $17.93 billion. Last year at this time, quarterly net revenue was recorded at $18.10 billion.

“It will take time to return Boeing to its former legacy, but with the right focus and culture, we can be an iconic company and aerospace leader once again,” said Boeing CEO, Kelly Ortberg. “Going forward, we will be focused on fundamentally changing the culture, stabilizing the business, and improving program execution, while setting the foundation for the future of Boeing.”

The company reported a net loss of $6.17 billion or $10.44 per adjusted share. During the same quarter last year, the company had a net loss of $1.64 billion or $3.26 per adjusted share.

The Seattle-founded aerospace giant reported mixed revenue results during the third quarter. Boeing’s Commercial Airplanes revenue dropped to $7.44 billion, a 5% decrease from $7.88 billion in the same quarter last year. Defense, Space & Security revenue rose to $5.54 billion, a 1% increase from $5.48 billion this time last year. Global Services revenue increased 2% to $4.90 billion from $4.81 billion in the third quarter of 2023. Boeing is currently in negotiations to resolve a labor strike that has been ongoing since September 13 and expects a deal to be reached within the coming weeks.

Boeing Company (BA) shares closed at $155.01, down 3.1% for the week.

The Dow started the week at 43,222 and closed at 42,114 on 10/25. The S&P 500 started the week at 5,858 and closed at 5,808. The NASDAQ started the week at 18,456 and closed at 18,519.

U.S. Treasury yields trended higher early in the week as investors responded to the latest economic data collected by the Federal Reserve which could impact further potential interest rate cuts. Yields fell at the end of the week as the total number of people currently collecting unemployment benefits climbed to the highest levels in nearly three years.

On Wednesday, the Federal Reserve released its latest Beige Book which compiles a survey of current economic conditions across the country to paint a picture of market conditions ahead of the Fed’s next rate policy meeting. The survey revealed that nine out of the 12 regional banks reported a flat to a slight decline in activity. Most districts also reported a decline in manufacturing activity but noted that housing activity was growing across the country.

“In contrast to the sturdy employment and retail-sales reports for September, the anecdotal readings from Fed’s Beige Book depict little economic growth across much of the country,” said chief economist at Nationwide, Kathy Bostjancic. “Given that Chair Powell has indicated that Fed officials are placing increased importance on the Beige Book and other anecdotal readings, the soft readings provide reason for the Fed to continue to ease monetary policy.”

The benchmark 10-year Treasury note yield opened the week of October 21 at 4.08% and traded as high as 4.26% on Wednesday. The 30-year Treasury bond opened the week at 4.40% and traded as high as 4.54% on Wednesday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment decreased by 15,000 to 227,000 for the week ending October 19. This fell below analysts’ expectations of 242,000 claims. Continuing unemployment claims increased by 28,000 to 1.89 million.

"The labor market is softening but not imploding," said chief economist at High Frequency Economics, Carl Weinberg. "Fed policy is aimed at supporting the economy and the job market before a recession shapes up. Gradual easing to achieve that goal may achieve it."

The 10-year Treasury note yield finished the week of 10/21 at 4.25%, while the 30-year Treasury note yield finished the week at 4.50%.

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, October 24. The survey showed mortgage rates increasing for the fourth consecutive week.

This week, the 30-year fixed rate mortgage averaged 6.54%, up from last week’s average of 6.44%. Last year at this time, the 30-year fixed rate mortgage averaged 7.79%.

The 15-year fixed rate mortgage averaged 5.71% this week, up from last week’s 5.63%. During the same week last year, the 15-year fixed rate mortgage averaged 7.03 %.

“The continued strength in the economy drove mortgage rates higher once again this week,” said Freddie Mac’s Chief Economist, Sam Khater. “Over the last few years, there has been a tension between downbeat economic narrative and incoming economic data stronger than that narrative. This has led to higher-than-normal volatility in mortgage rates, despite a strengthening economy.”

Based on published national averages, the savings rate was 0.45% as of 10/21. The one-year CD averaged 1.81%.

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