US Index Futures traded close to flat on Wednesday as investors digested weak China trade balance data.
At around 7:25 AM, Dow Jones (DOWI:DJI) futures were down 20 points, or 0.06%. S&P 500 futures were up 0.03%, while Nasdaq-100 futures were flat. The 10-year Treasury yield was at 3.683%. West Texas Intermediate crude rose 1.03% to settle at $72.48 a barrel.
China’s exports fell 7.5% from a year earlier, falling more than forecasts of 0.4% in a Reuters poll. Meanwhile, imports fell 4.5% year-on-year, above expectations for an 8% decline. The trade surplus was below expectations and reached US$ 65.81 billion.
The agenda of indicators in the United States for Wednesday brings the result of the trade balance for April (8:30 am), with Refinitiv consensus projecting a deficit of US$ 75.2 billion. At 10:30 am, data on oil inventories from the International Energy Agency will be released. In the evening, Japan releases Gross Domestic Product data. The next monetary policy decision by the central bank is scheduled for next Wednesday (14).
Among commodities, iron ore closed close to stability, up 0.7%, at 770 yuan, or the equivalent of US$107.98 per tonne on the Dalian Stock Exchange. The August oil futures contract was up slightly by 0.2% to trade at $76.43 a barrel.
At the close of Tuesday, the main indexes closed with slight increases, in a day without major developments. The Dow Jones gained a narrow 0.03%, or 10.42 points, to close at 33,573.28 points. The S&P 500 rose 0.24% to close at 4,283.85 points. The Nasdaq Composite rose 0.36% to close at 13,276.42 points. The market remained in doubt regarding the next FOMC decisions. At the same time, the economy continued to slow down, but with a greater chance of a soft landing. In other words, that the Fed will be able to complete the monetary adjustment cycle without generating a recession. On the commodity side, wheat jumped more than 3% after the Ukrainian government accused Russia of tearing down a dam in the south of the country, flooding the region and endangering 10 villages, as well as a part of the city of Kherson.
Wall Street Corporate Highlights for Today
UnitedHealth Group (NYSE:UNH) – UnitedHealth Group Inc announced a 14% increase in its quarterly dividend, from $1.65 per share to $1.88 per share. The new dividend will be paid on June 27th to shareholders of record by June 19th. UnitedHealth shares are down 8.0% year-to-date, while the healthcare ETF is down 4.5% and the Dow Jones Industrial Average is up 1.3%. UnitedHealth’s dividend yield outperforms Health Care Select Sector SPDR’s XLV fund and the S&P 500’s implied yield.
Merck (NYSE:MRK) – When the Inflation Reduction Act (IRA) was passed, allowing the US government to negotiate drug prices, Merck & Co. sued the government, alleging violation of the Constitution. The move aims to save Medicare nearly $100 billion by 2031, but drug companies fear impacts on research and development and drug profitability. Merck may not be the only one taking legal action, and other companies are considering the same path.
PDD Holdings (NASDAQ:PDD) – Chinese shopping app PDD Holdings is facing challenges due to intense competition and weak economic growth, leading to an increase in short interest. While PDD shares fell 30%, its revenues beat expectations in the first quarter. However, some investors are more concerned about PDD’s prospects compared to Alibaba and JD.com due to the latter’s restructuring and cheaper valuations. Alibaba (NYSE:BABA) plans to expand globally, while JD.com (NASDAQ:JD) bounces back from falling first-quarter earnings .
Apple (NASDAQ:AAPL) – Apple has acquired Los Angeles-based augmented reality startup Mira, according to Reuters. The acquisition comes on the heels of Apple’s launch of the Vision Pro augmented reality headset, putting it in direct competition with Meta. Mira also has US military contracts. Apple has confirmed the acquisition but has not released details about its plans.
Alphabet (NASDAQ:GOOGL) – Google is looking to solidify its position in the Android-dominated Indian market, while the country’s internet economy is projected to grow significantly. Google is expanding support for Indian languages and looking at ways to make its Android smartphones cheaper to win over users in India. The company is developing an artificial intelligence model to handle more than 100 Indian languages, aiming to expand internet access beyond English speakers.
Salesforce (NYSE:CRM) – Salesforce Chief Executive Marc Benioff has made changes to the company’s top management, according to Reuters. Miguel Milano has been named chief revenue officer, while Ariel Kelman will take over as chief marketing officer. Kendall Collins will also play an important role as Benioff’s chief of staff. These appointments come amid pressure from activist investors for operational improvements and efficiency. Salesforce previously announced plans to cut jobs and streamline its offices.
Netflix (NASDAQ:NFLX) – Netflix was up 2.43% to $409.00 after the stock price target was raised to $470 from $380 by JPMorgan analysts, and raised to $500 of $400 at Wells Fargo. In other news, Netflix Co-Executive Chairman Ted Sarandos plans to visit South Korea for two days starting June 20. The visit follows the announcement that Netflix will invest US$2.5 billion in the country over the next four years to produce Korean content. The South Korean entertainment industry, known as the “Korean wave” or Hallyu, has enjoyed international success, led by K-pop.
Chipotle Mexican Grill (NYSE:CMG) – Chipotle is requiring its corporate staff to work onsite four days a week, following the trend of companies tightening return-to-the-office rules. The company’s corporate restructuring also resulted in job cuts and the addition of new positions.
Starbucks (NASDAQ:SBUX) – Starbucks is redesigning its strategy in India, aiming to attract Indians, including children, with smaller and cheaper drinks. The company is looking to expand into smaller cities and meet the challenge of homegrown startups in one of its fastest growing markets. The new strategy includes offerings exclusive to India, such as small-size drinks and Indian-inspired teas. Competition and expansion into smaller cities drive this approach.
Vodafone (NASDAQ:VOD), CK Hutchison (USOTC:CKHUY) – Vodafone and CK Hutchison are close to finalizing the merger of their UK operations, with an announcement expected shortly. Vodafone will own 51% and Hutchison 49% of the combined group. The deal will face regulatory scrutiny.
Diageo (NYSE:DEO) – Ivan Menezes, longtime CEO of Diageo, has passed away after a brief illness. The company announced that interim CEO Debra Crew would take over immediately. Menezes, known for driving sales and spearheading acquisitions, was scheduled to retire at the end of the month.
Vantage Towers (USOTC:VTWRF) – On Wednesday, Vantage Towers announced the appointment of Christian Hillabrant, current COO of Tillman Infrastructure, as its next CEO. Hillabrant will take over in approximately two months, while Thomas Reisten will remain as Vantage’s interim CEO and chief financial officer until then.
Digital Realty Trust (NYSE:DLR) – The Digital Realty Trust said that Laurence Chapman, a former board member and chairman, had resigned a few days ahead of schedule, citing disagreements over governance practices. Chapman raised concerns about the behavior of another board member and the selection process for a new chairman, as well as questioning the preparation of the CEO’s succession plan. He considered such events as examples of bad governance practices.
Tesla (NASDAQ:TSLA) – Tesla has made rapid adjustments to its battery supply chain, allowing all of its Model 3 vehicles to qualify for US tax credits. This will bring the Model 3’s price down to less than a Toyota Camry, boosting sales and taking on the competition. Tesla is believed to have adjusted its supply chain to meet federal subsidy requirements, possibly dropping CATL in favor of Panasonic or LG Energy Solution. In other news, Mongolian Prime Minister Luvsannamsrai Oyun-Erdene and Elon Musk discussed possible expansion and investments in the country in a virtual meeting. In addition, they also talked about bringing Starlink’s satellite communications service to the country.
Fisker (NYSE:FSR) – Electric vehicle startup Fisker has signed a deal to sell emission credits to an undisclosed automaker. This strategy aims to address the economic challenges and fierce price competition in the Tesla-driven EV market. Fisker is also preparing to start deliveries of its Fisker Ocean electric SUV in the United States later this month.
Ford Motor (NYSE:F) – Ford Motor announced it is expanding a recall to 125,000 SUVs and pickup trucks due to engine failures that could cause fires. The recall covers specific models from the years 2020-2023 and the company is working on a solution to the issue. Recently, Ford also recalled Lincoln MKC SUVs due to fire hazards.
Boeing (NYSE:BA) – Boeing has announced it may have to slow deliveries of the 787 Dreamliner after discovering a new production fault. The company will have to inspect the 90 jets in its inventory, which will result in additional delays. While the failure does not pose a safety concern, Boeing does face challenges in reworking planes prior to delivery.
Goldman Sachs (NYSE:GS) – Goldman Sachs plans to establish an energy derivatives trading desk in Tokyo, targeting the growing Japanese energy market. Interest in these derivatives has increased due to increasing liquidity and volatility in electricity prices following the Ukraine crisis. The European Energy Exchange (EEX) has seen a significant increase in the trading volume of these Japanese energy futures.
JPMorgan Chase (NYSE:JPM) – JPMorgan Chase CEO Jamie Dimon urged Democratic lawmakers to end the debt ceiling during a private meeting on Tuesday, according to CNN. Dimon called the debt ceiling an “absolute disaster” and urged Congress to eliminate it. He praised lawmakers for reaching an agreement before a possible default. JPMorgan Chase & Co. experienced a 3.9% increase in 2023, compared to the 1.2% increase in the Dow Jones Industrial Average.
Citigroup (NYSE:C) – Citigroup CEO Jane Fraser said the bank will continue to expand its business in China during her first visit to the country. She expressed confidence in China’s economic growth and said Citi will continue to strengthen its presence in the country. The visit comes at a time when Beijing seeks to attract more foreign investment.
UBS (NYSE:UBS) – UBS expects to finalize its agreement with the Swiss government to cover losses of up to CHF 9 billion resulting from the emergency takeover of Credit Suisse by today, June 7. The government deal is one of the last hurdles before officially completing the acquisition. UBS is also in discussions with FINMA about capital and liquidity requirements for the combined bank. Higher capital requirements will be phased in gradually through early 2030.
HSBC (NYSE:HSBC) – HSBC UK, after acquiring Silicon Valley Bank UK, has said it will continue to support startups from initial funding to IPO. The bank plans to protect the subsidiary by maintaining its independent structure, risk policies and its own board. The goal is to expand globally, establishing a presence in the US, UK, Israel, the Middle East and Asia, according to CNBC.
Coinbase Global (NASDAQ:COIN) — Shares of Coinbase were up 2.2% in premarket Wednesday after falling more than 12% in the previous session following a Securities and Exchange Commission lawsuit that alleged years of violations of the securities rules on cryptocurrency exchange. Cathie Wood’s ARK Invest bought around 400,000 shares of Coinbase on Tuesday.
Mondee Holdings (NASDAQ:MOND) – Shares in Mondee Holdings saw a significant 20% drop in premarket trading on Wednesday after several shareholders sold part of their stakes in the travel technology company. The secondary offering of 5.25 million shares was priced at $10 each, below Tuesday’s closing price. Mondee has listed more than 30 selling shareholders and has granted underwriters an option to purchase additional shares.
TransCode Therapeutics (NASDAQ:RNAZ) – Shares of TransCode Therapeutics were up 9.0% premarket following the pricing of the company’s public offering and the release of positive preclinical results for its lead therapeutic candidate. The market reaction owes to the success of the preclinical study of TTX-MC138 in the treatment of glioblastoma multiforme. In addition, the company plans to raise $7 million through the sale of two million shares.
Inditex (USOTC:IDEXY) – Inditex, which owns Zara, said its spring-summer collection sales were up 16% in May, driven by wage cost mitigation and customer retention during the cost-of-living crisis. The company beat expectations for first-quarter net profit, posting 1.2 billion euros. Inditex plans to invest €1.6 billion to expand its stores in 2023. The company has maintained its competitiveness by raising prices and dealing with cost pressures.
Stitch Fix (NASDAQ:SFIX) – Stitch Fix shares gained 10.33% in premarket trade. The personal style company reported a third-quarter fiscal loss lower than analysts’ expectations and announced further cost-cutting initiatives.
AES Corp (NYSE:AES) – AES Corp acquired a 2 gigawatt solar storage project in California, strengthening its position in providing renewable energy to corporate customers. The Bellefield project, located in County Kern, will be the largest solar energy and storage project in the US. The first phase has a 15-year power purchase agreement and AES plans to add an additional 1 gigawatt in the second phase. The company is committed to expanding its renewable energy portfolio and providing 100% clean energy by 2050.
TC Energy (NYSE:TRP) – TC Energy of Canada is undertaking job cuts as part of its efforts to optimize value. While no specific details were provided on the number of jobs affected, industry sources indicate that the cuts are considerably smaller compared to other recent ones in the industry. TC Energy said these decisions are necessary to improve efficiency and optimize the value of its business. The company is responsible for operating the Keystone pipeline and transporting 25% of the natural gas consumed in North America.
Teck Resources (NYSE:TECK) – Teck Resources announced that it has received several bids for its steelmaking coal business, without disclosing whether Teck’s revised bid Glencore (USOTC:GLNCY) was included. Teck’s board will evaluate all proposals before making a decision. Other interested parties include a consortium led by Pierre Lassonde and the Nippon Steel Corporation. A sale of Teck’s coal business would end Glencore’s efforts to acquire the company.
Yext (NYSE:YEXT) – Yext shares were up 16.77% in premarket trading Wednesday after the marketing software company raised its revenue and earnings outlook for the fiscal year.
Dave & Buster’s Entertainment (NASDAQ:PLAY) – The entertainment and dining company rose 2.4% in premarket trade after fiscal first-quarter earnings beat Wall Street expectations.
Casey’s General Stores (NASDAQ:CASY) – Casey’s General Stores reported fiscal fourth-quarter earnings and revenue below estimates. Net income and revenue were lower compared to the same period last year. However, same-store sales increased driven by alcoholic beverages, food and in-store items. The company also announced a 13% increase in its quarterly dividend. Stocks are stable in premarket trading.
Couchbase (NASDAQ:BASE) – The database company released a second-quarter revenue forecast that missed analyst expectations. Stocks are stable in premarket trading.
J.Jill (NYSE:JILL) – J.Jill faced lower sales in the fiscal first quarter due to reduced consumer spending. The women’s apparel company reported a profit of $4.6 million, compared with $14.4 million in the prior-year period. Sales fell 4.9% to $149.4 million, with comparable sales down 2.7%. CEO Claire Spofford attributed the situation to customer caution in the evolving economic environment. The stock also showed a drop of 14.9% compared to the previous year.