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Midday Market Update

Stocks Lower as Brexit Uncertainty Continues

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U.S. Market    
Stocks were lower today as uncertainty surrounding next week’s Brexit vote continued to weigh.

Housing starts fell a smaller-than-expected 0.3% in May to seasonally adjusted annual level of 1.16 million. Permits were up 0.7% in the month to a rate of 1.14 million. April’s large boost in starts was revised down somewhat too.

At midday the Dow and S&P 500 were each down around 0.5% while the Nasdaq was 0.9% lower.

Stocks on the Move
 Oracle’s (ORCL) surge into the cloud  continued in the firm’s fourth quarter, as software- and platform-as-a-service revenue growth accelerated once again. Fourth-quarter revenue fell roughly 1% (flat in constant currency) to $10.6 billion, as cloud revenue growth was unable to completely offset fading on-premises license sales. We are encouraged by the improving metrics in the SaaS and PaaS businesses across both growth and profitability, as revenue rose roughly 66% versus the prior-year period while gross margins expanded to 56%, the segment’s highest quarterly mark since the first quarter of 2015. Shares were up 2.2% at midday.

 Apple (AAPL) shares were off 2% this morning after the Beijing intellectual property authority said the iPhone 6 violated a patent held be a Chinese firm. The authority ordered Apple to stop selling the phone within the city, but the firm will continue to sell handsets as it appeals the ruling.

Foreign Markets
European stocks were higher today on the back of bank shares. The FTSE 100, Paris CAC and Germany’s DAX were up 1%, 0.7% and 0.6% respectively.

Asian markets were also higher. The Shanghai Composite rose 0.5%, the Nikkei 225 gained 1.1% while the Hang Seng was 0.7% higher. 

Jeremy Glaser does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.