US markets continued to show volatility in August, but nevertheless were up for the month. The Dow Jones Industrial Average and S&P 500 reached a four-year monthly high sparked by positive earnings news and US economic growth. On August 28, the US Commerce Department issued its latest revised estimates for second quarter GDP growth, increasing it from 4.1% to 4.2%. Market volatility for the month was marked by concerns about additional US-China tariffs and the decline of the Turkish lira. The Dow Jones, S&P 500 and NASDAQ finished the month up 2.2%, 3.0% and 5.7%, with both the S&P 500 and NASDAQ posting faster growth than in July.

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Laboratory Instruments and Products Stock Index

The IBO Laboratory Instruments and Products Stock Index rose 4.2% in August, with double-digit growth for the year. NanoString Technologies and Pacific Biosciences led all gainers, rising 38% and 31%, respectively. Four companies recorded share declines, with Luminex plunging 17%.

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In August, 13 of the 20 of the companies in the Index announced quarterly earnings results. On August 14, Agilent Technologies reported fiscal third quarter financials and forecast fiscal fourth quarter adjusted EPS of $0.72­–$0.74, compared to $0.67. The company also raised its fiscal full-year EPS guidance by $0.05 to $2.69–$2.71, adjusted for updated currency effects. Incremental duty costs related to US-China tariffs are expected to cut EPS by $0.01. Last month, Thermo Fisher Scientific stated that it expects a $0.03 impact on its adjusted EPS in the second half of 2018 as a result of US-China tariffs.

After topping analysts’ adjusted EPS and internal estimates on August 1, PerkinElmer raised its 2018 earnings guidance. The company now expects full-year adjusted EPS of $3.65, a $0.15 increase, which would represent a 26% rise year over year. Third quarter adjusted EPS is forecast to grow 26% to $0.92.

In contrast, on August 7, MTS Systems lowered its fiscal 2018 adjusted EPS forecast to $3.25–$3.35 from the previous estimate of $3.55–$3.85 due to weakness in its ground vehicle business. The company’s fiscal third quarter adjusted EPS missed analysts’ estimates.

Also on August 7, Bio-Techne reported fiscal 2018 results. For the year, adjusted EPS increased 15% due to operational improvements, tax reform and currency. The company did not provide an adjusted EPS forecast for fiscal 2019.

As for analysts’ ratings, on August 7, Morgan Stanley upgraded Illumina from an “underweight” rating to “equal weight.” On August 8, Cantor Fitzgerald initiated coverage of Pacific Biosciences with a rating of “overweight.”

In other news, NanoString Technologies announced on August 13 the results of a public offering, including writers’ options, of 4.6 million shares at $12.50 per share. Proceeds totaled $53.9 million.

In addition, several companies announced debt offerings during the month. Illumina announced plans to issue $650 million in convertible senior notes due in 2023. An additional offering of $100 million to initial purchasers brings the total offering to $750 million. Use of the proceeds will include the repurchase of $150 million in common stock. Thermo Fisher announced on August 8 that it issued in a public offering €600 million ($698 million) in floating rate senior notes due 2020. The anticipated net proceeds of approximately €597.6 million ($695 million) after expenses will be used to pay down outstanding debt.

Diversified Laboratory Stock Index

Despite August gains for the major indexes, IBO’s Diversified Laboratory Stock Index declined 0.4% for the month. Over half of the Index’s stocks showed declines, led by Illinois Tool Works. Teledyne Technologies recorded the largest jump by far.

The increase comes in wake of Teledyne Technologies’ announcement of record earnings on August 2. Raising its full-year GAAP EPS, the company now expects new range of $8.18–$8.28, up from $7.67–$7.77. Third quarter GAAP EPS is estimated to be $2.01–$2.06 compared to $1.90.

Roper Technologies announced on August 14 the pricing of a $700 million in public offerings of senior notes due 2023 and $800 million in senior notes due 2028. The company expects to use the proceeds to repay outstanding notes and a credit facility, as well as to fund general corporate purposes.

International Stock Indexes

Major Asian indexes ended the month mixed. China’s Shanghai SE Composite was down -0.55% due to trade concerns, Hong Kong’s Hang Seng Index fell 0.98%. But Japan’s Nikkei 225 was up 1.5% and South Korea’s KOSPI Index rose 1.54%.

Asia Pacific companies in the IBO Stock Table were mixed. GL Sciences rose 8.9%, while Precision System Science declined 11.1%. On August 7, Shimadzu announced fiscal 2019 first quarter results of ¥14.77 ($0.14) EPS, up 79.2%, in part due to currency effects. For fiscal 2019, the company forecasts EPS of  ¥108.63 ($1.00) for a 7.3% increase. HORIBA reported first half results on August 3, with a double-digit percentage increase in revenue, operating profit and net income. However, the company lowered its full-year sales forecast.

In Europe, major stock indexes were depressed in August. The UK’s FTSE 100 declined 3.0%, while Germany’s DAX fell 2.0% and France’s CAC was down 0.91%. European shares in the IBO Stock Table were mixed in August, with Datacolor and Tecan falling. Tecan reported first-half financial results on August 16. Diluted EPS increased 10.8% to CHF 2.46 ($2.48) as the company’s Partnering Business posted strong sales (see Bottom Line). Merck KGaA announced second quarter results on August 9, posting an adjusted EPS that declined 18.5% to €1.23 ($1.46) impacted in part by negative currency effects.

All UK shares in the IBO Stock Table were up this month with the exception of Scientific Digital Imaging. Nonetheless, the company is up 71% for the year. Horizon Discovery led all companies, gaining 16.7%. In mid-August, Peel Hunt upgraded Spectris to an “add” rating, but Shore Capital downgraded the stock to “hold”. During the month, Spectris completed a £100 million ($137 million) stock buyback.