US index futures are higher on Friday, buoyed by quarterly results and anticipation of the US employment report.
By 6:59 AM, Dow Jones (DOWI:DJI) futures were up 5 points, or 0.01%. S&P 500 futures were up 0.18%, while Nasdaq-100 futures were up 0.31%. The 10-year Treasury yield was at 4.186%.
Retail sales in the euro zone had a retraction of 0.3% in June, frustrating the expectations of analysts who had expected an increase of 0.20%. Meanwhile, industrial orders in Germany rose 7% in June, beating the consensus forecast for a 2% decline. In the corporate field, shares of Credit Agricole (EU:ACA) rose 4% after the bank beat expectations for profit, posting 2.4 billion euros in the second quarter.
In Asia, stock markets closed higher, reflecting new promises to stimulate economic activity and awaiting the employment report in the US. In China, the central bank announced a more flexible approach and use of monetary policy instruments, including reserve requirements cuts, to guarantee liquidity in the banking system.
On Friday’s US economic agenda, investors will follow the July non-farm employment report, the Payroll, in addition to the unemployment rate for the same period. Both will be released at 8:30 am. At the same time, information on the average salary gain of American workers and the number of hours worked will be known. The estimate is the net creation of 200,000 jobs in July, compared to 209,000 openings in June. Despite the expected slowdown, the labor market should still show resilience – and this, combined with observed disinflation in the USA, reinforces the optimism that the country will avoid an economic recession, although it may indicate that the Federal Reserve has residual interest rate hikes to carry out.
In commodities markets, West Texas Intermediate crude for September was up 0.44% to trade at $81.91 a barrel. Brent crude for October was up 0.39% near $85.47 a barrel. Iron ore futures traded in Dalian, China fell 0.39% at USD113.73 a tonne.
The stock market continued to retreat on Thursday, even as investors looked forward to Apple’s Amazon earnings reports released after yesterday’s market close. The Dow fell 66.63 points, or 0.19%, to 35,215.89 points. The S&P 500 fell 11.50 points, or 0.25%, to 4,501.89 points. The Nasdaq Composite dropped 13.73 points, or 0.10%, to 13,959.72 points. Contributing to the slide, long-term US Treasuries face their worst week of 2023 on signs of surprising economic strength and budget deficit concerns. To finance the government deficit, the US Treasury announced a new debt issue in a large amount.
Ahead of Friday’s corporate results, traders are awaiting reports from fuboTV (NYSE:FUBO), Nikola (NASDAQ:NKLA), Magna (NYSE:MGA), Enbridge (NYSE:ENB), Dominion Energy (NYSE:D), Frontier Communications (NASDAQ:FYBR), among others.
Wall Street Corporate Highlights for Today
Alphabet (NASDAQ:GOOGL) – Texas won a victory in its antitrust lawsuit against Google after a court panel refused to stay the decision to refer the case back to the state’s federal court. The lawsuit accuses Google of abusing its dominance in advertising technology. The search and advertising giant faces multiple antitrust lawsuits around the world.
Microsoft (NASDAQ:MSFT) – On Thursday, shares of Microsoft were down 0.26% to close at $326.66 in a tough day for the stock market. The price was $40.12 below the 52-week high ($366.78) reached in July. Trading volume was 12 million below the 50-day average.
Apple (NASDAQ:AAPL), Samsung (USOTC:SSNHZ), HP Inc (NYSE:HPQ) – Big companies like Apple Inc and Samsung Electronics, and HP Inc have frozen new imports of laptops and tablets to India after sudden ban on unlicensed shipments. Manufacturers are negotiating with the government to get licenses quickly, but the disruption hurts the multi-billion dollar foreign PC market. The move is part of India’s efforts to encourage local technology production and attract manufacturers to the country.
Nvidia (NASDAQ:NVDA) – Specialty cloud provider CoreWeave secured a $2.3 billion loan led by Magnetar Capital and Blackstone, with Nvidia chips used as collateral. The funding will be used to expand the cloud infrastructure and meet the growing demand for AI work. CoreWeave has exclusive access to Nvidia chips, giving it a competitive edge against other cloud providers. The company also raised $421 million in stock this year at a valuation of more than $2 billion.
Tesla (NASDAQ:TSLA) – Tesla sold 64,285 Chinese-made electric vehicles in July, down 31% from the previous month, according to data from the China Passenger Car Association. However, sales of Model 3 and Model Y cars increased by 128% year-over-year. Chinese rival BYD posted a 61% increase in July sales, including 18,169 exported passenger vehicles.
General Motors (NYSE:GM) – General Motors said offering higher wages to unionized workers is challenging due to ambitious United Auto Workers (UAW) contract requirements, which include large pay increases. The UAW seeks a raise of at least 40% during the four-year contract. In other news, GM’s robotaxis unit, Cruise, signed its first union agreements in the driverless auto industry, partnering with two local union chapters in San Francisco. Unions have historically worried about automation, but the Cruise deal will create new job opportunities. US regulators are considering a petition by Cruise to deploy up to 2,500 autonomous vehicles annually.
Fisker (NYSE:FSR) – Electric vehicle maker Fisker has unveiled a pickup truck, the Alaska, with production plans starting in 2025. The Alaska will join the growing market for electric pickup trucks, offering a sporty design at a competitive price of around of $45,000. However, the company faces supply chain challenges due to the pandemic.
Nikola (NASDAQ:NKLA) – The electric truck maker has gained enough shareholder support to increase the number of shares it can issue, securing much-needed capital. The company faced financial difficulties and had to postpone the shareholders’ meeting twice. The CEO highlighted the importance of this result for the company’s continued growth. Still, investors have concerns about Nikola’s cash position. The company will report second-quarter results, expecting a drop in revenue and mounting losses.
Spirit Airlines (NYSE:SAVE) – Spirit Airlines has warned that its September quarter revenue will be affected as it needs to ground seven Airbus A320neo jets due to problems with RTX‘s Pratt & Whitney GTF engines. The company cut its planned capacity by 5% and estimates that various engine problems will reduce its revenue by about 7.5 percentage points. RTX (NYSE:RTX) promised to compensate affected airlines. Spirit expects to have at least 10 aircraft out of service for much of 2024 due to scheduled engine checks.
Sprout Social (NASDAQ:SPT) – The digital media company on Thursday announced the acquisition of Tagger Media, a social intelligence and influencer marketing platform, by the company.
Walgreens (NASDAQ:WBA) – Walgreens Boots Alliance sold shares of AmerisourceBergen (NYSE:ABC) for about $1.85 billion, reducing its stake in the distributor to about 16%. Proceeds will be used to pay off debts and general corporate purposes. Walgreens remains AmerisourceBergen’s largest shareholder.
Regeneron Pharmaceuticals (NASDAQ:REGN) – Regeneron expects a US FDA decision on a higher-dose version of its eye disease drug Eylea in the third quarter. The FDA refused approval in June, but the company expects to complete manufacturing data submissions in August. Approval can provide a defense against competitors and help the company win more patients. Sales of Eylea were down, but the eczema drug Dupixent saw a significant increase in sales. The company reported adjusted earnings above analyst estimates.
Nutrien (NYSE:NTR) – Canadian potash producer Nutrien does not plan to sell assets to raise capital, despite falling fertilizer prices and project cutbacks. CEO Ken Seitz stated that asset sales will only be considered opportunistically. The company also faces logistical problems due to strikes and delays at export terminals. The situation may take weeks to normalize.
Albemarle (NYSE:ALB) – Albemarle is building a facility in Arkansas to test its direct lithium extraction (DLE) technology to filter metal from electric vehicle batteries. If successful, this would cement its dominance in the fast-growing industry. Other companies are also investigating DLE technologies.
Berkshire Hathaway (NYSE:BRK.A) – Berkshire Hathaway’s Class A stock reached a record high on Thursday, lifting the CEO’s 15% stake in the company to $118 billion ahead of his 93rd birthday on 30 August. While Class B shares also rose, A shares achieved a 2% premium to them. The company has a market cap of around $780 billion, making it the eighth largest by market capitalization. The A shares are up about 15% this year and have risen more than 25,000 times since Buffett took over the company in 1965. The shares were never split during his tenure.
KKR and Company (NYSE:KKR) – KKR & Co Inc is in advanced talks to acquire Simon & Schuster Publishing from Paramount Global (NASDAQ:PARA) for $1.65 billion, competing against HarperCollins Publishers. If successfully completed, the deal could be announced in the coming days. The sale is not expected to raise competition concerns like the previous deal with Penguin Random House. Simon & Schuster publishes authors such as Stephen King, Jennifer Weiner and Hillary Clinton.
Blackstone (NYSE:BX) – Private equity fund Blackstone plans to make a bid to acquire 33.47% of Cipla, according to the Economic Times. The sale marks the departure of the Hamied family, which founded the company in 1935. Blackstone may also launch an open bid to acquire an additional 26% of Cipla (USOTC:CPLFY).
BlackRock (NYSE:BLK) – A US Congressional committee is investigating BlackRock and MSCI for facilitating the flow of capital to Chinese companies blacklisted by the US government. The committee chairman has threatened to issue subpoenas if he does not receive “complete” responses. The objective is to avoid investments in companies with interests contrary to US values. In addition, the committee sent a letter to the White House asking for restrictions on “problematic” ownership of Chinese stocks and bonds in the US. The committee seeks to protect agricultural technology from the risks of Chinese government-sponsored theft.
JPMorgan Chase (NYSE:JPM) – JPMorgan Chase plans to set aside about $3 billion to replenish the FDIC fund following the finalization of rules proposed by the banking regulator. Large US banks will shoulder most of the costs, with Wells Fargo (NYSE:WFC) estimating up to $1.8 billion and Bank of America (NYSE:BAC) up to $1.9 billion in pre-tax expenses. The proposed rule would apply a 0.125% “special assessment” fee to unsecured creditor deposits in excess of $5 billion.
Bank of America (NYSE:BAC) – Bank of America customers are pulling out of stocks due to the risk of an economic downturn. They were net sellers of stocks for two straight weeks and increased bond purchases. The bank warns of the risk of a hard landing in the second half of 2023. While the strategist was correct in his bearish forecast for 2022, his pessimistic views for this year did not materialize, as US stocks rose for five months consecutive until July. Inflows into tech funds have remained strong, attracting nearly $6 billion over the past four weeks.
Citigroup (NYSE:C) – Citigroup’s family office business in Asia forecasts a 25% increase in client numbers this year, driven by strong demand from wealthy Asians looking to invest and plan for business succession. Hong Kong and Singapore compete to attract the most wealth, with both financial centers taking steps to attract family offices. Asia is outpacing other regions in terms of the growth of wealthy investors, and this growth is expected to continue through 2026 and beyond. In other news, Paco Ybarra, CEO of Citigroup’s institutional client group, will step down in the first half of next year after 36 years with the firm. Recognized for leading important deals, Ybarra has helped Citi navigate challenging times in the industry.
NatWest Markets (NYSE:NWG) – Following the Bank of England (BoE) announcement of a further rate hike and new guidance, NatWest Markets lowered its forecast for the peak in interest rates to 5.5%, down from the 6% forecast previously.
Tupperware Brands (NYSE:TUP) – Tupperware Brands finalized an agreement with its creditors to restructure its debt obligations, boosting its stock by 57% on Thursday. The deal will allow the company to reduce US$150 million in interest and fees and gain access to a US$21 million revolving credit facility.
WPP (NYSE:WPP) – Advertising group WPP lowered its annual growth forecast due to a decline in marketing spend from major US technology companies. Comparable revenue for the year was revised down to 1.5-3.0%, hurting British group shares. CEO Mark Read cited falling customer technology spending and delays in related projects as challenges to growth. The company faces uncertainty about the timing of the recovery of these technology expenditures.
Earnings
Amazon (NASDAQ:AMZN) – Amazon posted an impressive 8.5% premarket increase on Friday, buoyed by solid Q2 results and upbeat revenue prospects for the current period. According to Refinitiv, Amazon reported earnings of 65 cents a share, beating analyst expectations of 35 cents a share. In addition, revenue grew by 11%, reaching US$ 134.4 billion, surpassing the forecasted US$ 131.5 billion.
Apple (NASDAQ:AAPL) – Apple shares were down 1.8% premarket as traders pored over the company’s latest financial report. In the third fiscal quarter, earnings per share reached US$ 1.26, surpassing the expectations of analysts consulted by Refinitiv, who predicted US$ 1.19 per share. While revenue also exceeded expectations, it was down about 1% year-on-year.
CarGurus (NASDAQ:CARG) – CarGurus has postponed its second-quarter earnings release and analyst conference call, citing uncompleted quarterly closing procedures. The company last updated investors in May, beating Wall Street estimates. The stock ended Thursday’s regular session down nearly 4% but still posted a 53% gain this year, compared with 19% for the S&P 500.
Airbnb (NASDAQ:ABNB) – Following the release of second-quarter results, shares were down 0.2% in premarket trading on Friday. Airbnb reported earnings per share of 98 cents and revenue of $2.48 billion. Analyst projections called for earnings per share of 78 cents and revenue of $2.42 billion, according to Refinitiv. However, the company’s night bookings and experiences fell short of expectations.
Booking Holdings (NASDAQ:BKNG) – Shares of the online travel company were up 9% in extended trading but were flat in premarket trading. During the second quarter, Booking Holdings reported adjusted earnings of $37.62 per share and revenue of $5.46 billion. Analysts polled by Refinitiv had projected earnings of $28.90 a share on revenue of $5.17 billion.
Dropbox (NASDAQ:DBX) – The online collaboration platform erased its 3% advance and is flat premarket after posting solid second-quarter earnings. Dropbox reported adjusted earnings per share of 51 cents, beating analysts polled by Refinitiv who had forecast 46 cents per share. Additionally, revenue reached $623 million, beating the forecast of $614 million.
Fortinet (NASDAQ:FTNT) – Cybersecurity stocks were down 17.5% premarket after a mixed Q2 report and outlook. Fortinet posted adjusted earnings of 38 cents per share on revenue of $1.29 billion. Analysts polled by Refinitiv had expected earnings of 34 cents a share and revenue of $1.3 billion. Guidance for the current quarter was similarly mixed, with forecast earnings in line with expectations, but forecast revenue was below what Wall Street had forecast.
Atlassian (NASDAQ:TEAM) – Atlassian stock rose 23.2% premarket after the software development and project management tools company released a fiscal first-quarter sales forecast that beat analyst expectations. The company expects sales of between $950 million and $970 million, beating forecasts of $954 million.
DraftKings (NASDAQ:DKNG) – The digital betting company’s shares soared with a 14.2% premarket increase after DraftKings beat analysts’ estimates in the second quarter. The company posted a loss of 17 cents a share and revenue of $875 million. Analysts had forecast a loss of 25 cents a share and revenue of $764 million, according to Refinitiv.
Corsair Gaming (NASDAQ:CRSR) – Shares in Corsair were initially down but are flat premarket despite posting strong gains and reiterating its full-year outlook. In the second quarter, earnings per share were in line with the FactSet consensus estimate, reaching 9 cents. Revenue beat expectations, reaching $325.4 million, compared to the forecast of $322.8 million.
Block (NYSE:SQ) – Shares of the payments technology company were down 4.55% in premarket trade, even as second-quarter earnings and revenue beat expectations. Square reported earnings of 39 cents a share, beating analysts’ estimate of 36 cents by Refinitiv. Additionally, revenue of $5.53 billion also beat the expectation of $5.10 billion.
Coinbase (NASDAQ:COIN) – The cryptocurrency trading platform was up 1.5% premarket after the release of Q2 results. Coinbase posted a lower-than-expected loss of 42 cents a share, while analysts polled by Refinitiv had forecast a loss of 77 cents a share. In addition, revenue also beat expectations, reaching $708 million, against the analysts’ forecast of $633 million.
Redfin (NASDAQ:RDFN) – Redfin was down 10.1% premarket after issuing a weaker-than-expected third-quarter revenue outlook. The company forecast revenue of between $265 million and $279 million for the third quarter, below the $288 million expected by analysts polled by Refinitiv. Meanwhile, the real estate company posted revenue of $276 million in the second quarter, in line with estimates. Additionally, Redfin reported a lower-than-expected loss of 25 cents per share, beating the forecast loss of 32 cents per share.
Cargill – Global commodities trader Cargill reported record revenue of $177 billion in fiscal 2023, up 7% year-over-year. Demand for food, animal feed and biofuels boosted earnings as the company halted public reporting in 2020. Publicly traded Archer-Daniels-Midland (NYSE:ADM) and Bunge (NYSE:BG) also reported solid earnings and elevated 2023 prospects.
Gilead Sciences (NASDAQ:GILD) – Shares in Gilead Sciences are up 0.3% premarket after it slashed its full-year profit forecast due to a $525 million legal settlement, but said the deal center was growing. Second-quarter sales were up 11%, excluding Covid-19 treatment Veklury. The company continues to pursue growth in oncology after a disappointing trial. The stock is down 12% this year.
DigitalOcean (NYSE:DOCN) – Shares in DigitalOcean fell 22.9% premarket after lowering its full-year profit forecast and disclosing accounting errors in its March quarter results. The company still reported second-quarter revenue growth, but some customers are slowing spending reflecting weakness in their own businesses. The stock is up 88% this year.
PayPal (NASDAQ:PYPL) – Shares in PayPal Holdings declined on weak second-quarter margins despite an upbeat forecast. Higher provisions in its loan portfolio and stricter loan underwriting standards hurt margins, resulting in projected adjusted earnings per share for the current quarter in line with analyst expectations. The company is also seeking a new CEO to succeed Dan Schulman.
ConocoPhillips (NYSE:COP) – ConocoPhillips slightly raised its full-year production expectations despite a lower-than-expected quarterly profit. The company foresees a production between 1.80 million and 1.81 million barrels of oil and gas per day. Earnings more than halved to $1.84 a share due to weak oil and gas prices. Conoco also lowered its capital spending guidance range.
Cummins (NYSE:CMI) – Engine maker Cummins reported second-quarter profit below analyst estimates due to high manufacturing costs. The company faced challenges with weak demand in China and costs related to raw materials and labor. However, its revenue increased by 31.2%.
Moderna (NASDAQ:MRNA) – Moderna has forecast up to $4 billion in revenue from its Covid-19 vaccine as it moves to a private market from government contracts. The company expects demand to grow further in 2024 and match the flu vaccine market. In the second quarter, sales plunged 94%, but beat analysts’ estimates. The company reported a smaller-than-expected loss.
Kellogg (NYSE:K) – Kellogg has revised downward its forecast of falling annual profit, thanks to price increases on its products. However, the company missed its second-quarter sales estimates due to inflation and reduced demand. Prices increased, but organic volumes decreased. The company expects adjusted earnings per share in 2023 to decline between 1% and 2%.
Yelp (NYSE:YELP) – Yelp beat expectations with its second-quarter financial results, driven by strong demand for local advertising from home service providers. Revenue reached $337 million, up 13% year-over-year. The company also raised its full-year outlook.
Warner Bros Discovery (NASDAQ:WBD) – Warner Bros Discovery has warned that Hollywood double strikes by writers and actors could affect film release schedules and content production. The strikes have impacted series and film production, and the company is looking for solutions. Second-quarter revenue suffered from low box office results, but the streaming business beat financial projections. The company is optimistic of achieving total synergies of $5 billion by 2024 and beyond. Free cash flow reached $1.72 billion for the three months ended June, beating estimates of $987 million. The company cut expenses by 16% in the quarter, helping to reduce its net loss from $3.42 billion a year earlier to $1.24 billion.
Monster Beverage (NASDAQ:MNST) – Monster Beverage reported second-quarter sales below Wall Street estimates due to rising living costs, which impacted demand for its more expensive energy drinks and alcohol brands. Operating expenses also increased as the company implemented price increases to address pressures from higher raw material costs and labor expenses. Profit was in line with expectations.
Etsy (NASDAQ:ETSY) – Etsy CEO Josh Silverman said the company’s results saw a new record of nearly 91 million active buyers in the second quarter. While it had a good quarter, the company gave weak guidance for the third quarter, which led to a more than 13% drop in the stock. Etsy seeks growth beyond the gains made during the pandemic, driving revenue through seller success and international growth. The company is focused on providing the best possible shopping experience on its platform.