US index futures are up on Friday, with Wall Street looking for a rebound after recent declines. Investors are keeping an eye on quarterly results from major oil companies such as Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX). In addition, Amazon (NASDAQ:AMZN) and Intel (NASDAQ:INTC) boosted technology stocks with their strong results.
At 06:49 AM, Dow Jones futures (DOWI:DJI) were up 43 points, or 0.13%. S&P 500 futures were up 0,51%, and Nasdaq-100 futures increased by 0.96%. The 10-year Treasury bond yield stood at 4.868%.
In the commodities market, West Texas Intermediate crude oil for December rose 2.14%, trading at $84.99 per barrel. Brent crude for December went up 2.13%, nearing $89.80 per barrel. The 62% concentrated iron ore, traded on the Dalian exchange, rose by 2.12%, priced at $121.51, continuing its strong uptrend that marked the week.
On the economic agenda for Friday, investors await the September Personal Consumption Expenditures (PCE) price index at 08:30 AM. At 09:00 AM, the Vice Chairman for Supervision of the Fed, Michael Barr, will speak at an event. At 10:00 AM, the University of Michigan will release the final October consumer sentiment index. At 13:00 PM, Baker Hughes data for operational oil wells is expected.
European stocks opened with mixed results, with investors focused on corporate earnings and the state of the global economy, maintaining a balanced sentiment. The benchmark Stoxx 600 index saw a slight drop of 0.1%. Though the week has been relatively stable overall, the index is on track to record its worst monthly performance since September 2022, according to LSEG data.
Asian markets showed a mix of performances, with gains in the Hong Kong and Japanese stock exchanges standing out. Chinese stocks rose following industrial profit data, albeit with slightly weaker growth. The yen remained stable after an unexpected rise in Tokyo inflation.
Investors are closely monitoring geopolitical events in the Middle East. The Israeli military forces claimed to have eliminated the deputy chief of Hamas’s intelligence services, accused of planning attacks in October. Additionally, Israel carried out a limited ground attack north of Gaza. At the same time, Iran has ramped up its rhetoric against the United States, which is closely watched by financial markets.
U.S. stock markets closed sharply lower in Thursday’s session, primarily due to disappointments with recent corporate financial reports. The Dow Jones dropped 251.63 points or 0.76% to 32,784.30 points. The S&P 500 declined by 49.54 points or 1.18% to 4,137.23 points. The Nasdaq Composite fell 225.62 points or 1.76% to 12,595.61 points.
However, economic indicators acted as a counterbalance, minimizing the declines, highlighted by the U.S. GDP figures for Q3 2023. The U.S. GDP grew by 4.9% compared to the previous quarter, surpassing the 4.5% forecast. Nevertheless, the core GDP deflator showed a significant decrease, leading to an adjustment in the Treasury yield curve. Thus, economic performance in the third quarter revealed higher than expected growth with a decline in prices, representing an ideal situation for the Federal Reserve.
On Thursday’s corporate earnings front, investors will be watching reports from Exxon Mobil (NYSE:XOM), Chevron (NYSE:CVX), Abbvie (NYSE:ABBV), Charter Communications (NASDAQ:CHTR), Phillips 66 (NYSE:PSX), AutoNation (NYSE:AN), Colgate-Palmolive (NYSE:CL), among others.
Wall Street Corporate Highlights for Today
Apple (NASDAQ:AAPL) – The U.S. International Trade Commission (ITC) has issued an order that might ban the import of Apple’s Apple Watches for infringing on Masimo’s (NASDAQ:MASI) blood oxygen technology patents. The decision awaits presidential review and possible appeals, leaving an uncertain impact on future sales. Masimo shares have risen by 10.2% in Friday’s pre-market trading.
Alphabet (NASDAQ:GOOGL) – Sundar Pichai, CEO of Alphabet and Google, will testify on Monday in a major antitrust case challenging Google’s dominance in search and advertising. He will answer questions regarding investments to maintain competitiveness and payment agreements to establish Google as the default on smartphones.
Western Digital (NASDAQ:WDC) – Western Digital and Kioxia Holdings have discontinued merger discussions due to disagreements over terms. Kioxia investor SK Hynix also opposed the deal. Both companies remain interested in continuing negotiations but have encountered obstacles, including SK Hynix’s opposition and issues with Kioxia’s main shareholder, Bain Capital (NYSE:BCSF). The potential merger has raised antitrust and regulatory concerns, including scrutiny from Chinese regulators.
Netflix (NASDAQ:NFLX), Disney (NYSE:DIS) – Striking Hollywood actors have approved a comprehensive counterproposal to AMPTP, representing media companies like Disney and Netflix. Negotiations are set to continue on Friday.
RTX Corporation (NYSE:RTX) – U.S. RTX and Israel’s Rafael Advanced Defense Systems plan to construct a missile manufacturing facility in East Camden, Arkansas, to produce Tamir missiles, utilized in the Iron Dome system and its SkyHunter variant. Production is slated to commence in 2025.
Embraer (NYSE:ERJ) – Embraer has announced that its firm order backlog has reached US$17.8 billion at the end of the third quarter, bolstered by a recent order from SkyWest for 19 E175 jets. The portfolio has expanded by US$500 million compared to the previous quarter. Embraer has delivered 43 aircraft in the third quarter, totaling 105 for the year to date. SkyWest has placed an order for 19 E175 jets at $1.1 billion, with deliveries scheduled to start in the final quarter of 2024, operating under a capacity purchase agreement (CPA) for United Airlines (NASDAQ:UAL).
Boeing (NYSE:BA) – Boeing’s defense division is grappling with significant challenges, including supplier errors and high manufacturing costs, resulting in a $1.7 billion loss in 2023. This includes projects such as Air Force One and NASA’s Starliner capsule. The company is actively seeking improvements but remains under fixed-price contracts, forcing it to absorb excessive costs. Analysts are questioning Boeing’s management, and shares have declined by 6% this year, in contrast to the S&P 500. The company is now concentrating on future contracts for next-generation fighter jets and advanced drones.
General Motors (NYSE:GM) – General Motors’ Cruise has suspended operations nationwide after California regulators highlighted public safety risks. This move aims to rebuild public trust following previous incidents, unrelated to new problems. U.S. authorities are investigating reports of sudden braking in Cruise self-driving cars.
Tesla (NASDAQ:TSLA) – BP’s (NYSE:BP) electric vehicle charger unit has ordered $100 million worth of Tesla’s ultra-fast chargers for deployment in the United States. This is part of BP Pulse’s plans to invest up to $1 billion in charging infrastructure in the U.S. by 2030, thereby expanding Tesla’s revenue streams. The chargers will be installed at BP locations and third-party sites, including car rental companies such as Hertz (NASDAQ:HTZ). Additionally, Tesla has increased the price of the Model Y high-performance SUV in China by US$1,913.88, according to a company statement on social media.
BHP (NYSE:BHP) – Approximately 350 BHP rail workers in Australia have voted in favor of industrial action, which could include strikes of up to 24 hours, due to disputes over pay and conditions. These disruptions could impact BHP’s iron ore operations in Port Hedland, the world’s largest iron ore export hub.
ConocoPhillips (NYSE:COP) – ConocoPhillips is considering making an offer for CrownRock LP, a Texas energy company in the Permian region, estimated to be worth between $10 billion and $15 billion. Other companies, such as Diamondback Energy (NASDAQ:FANG), Devon Energy (NYSE:DVN), and Marathon Oil (NYSE:MRO), are also exploring bids for CrownRock.
Walmart (NYSE:WMT) – Chinese grocery chains are struggling due to changing consumer preferences and the rise of e-commerce. Supermarket sales fell 0.4% this year, while online sales increased 11.6%. Companies face losses and challenges, with Walmart and Sam’s Club seeking to adapt to new consumer trends to stay relevant.
Chipotle Mexican Grill (NYSE:CMG), McDonald’s (NYSE:MCD), Yum Brands (NYSE:YUM) – Investors are paying attention to a possible shift in fast-food consumption patterns in the U.S. due to the popularity of weight-loss medications. Companies like Chipotle, McDonald’s, and Yum Brands already face challenges due to inflation and could suffer more due to this factor. While it’s too early to quantify the impact, traffic at fast-food restaurants saw a significant drop in the third quarter.
JPMorgan Chase (NYSE:JPM) – JPMorgan has reached out to Venezuelan bondholders to discuss normalizing the weighting of these bonds in its EMBI indexes following the lifting of U.S. sanctions in response to a political settlement. The bank reduced its weighting to zero in 2019 due to sweeping sanctions.
Goldman Sachs (NYSE:GS) – Goldman Sachs launched the Goldman Sachs Global Institute, led by Jared Cohen and George Lee, to provide geopolitics and technology insights to clients. Lazard also advises on geopolitical risks, highlighting the importance of geopolitics for global companies.
Citigroup (NYSE:C) – The Federal Reserve has closed its 2015 enforcement action against Citigroup resulting from violations of U.S. antitrust laws related to exchange rate manipulation.
Live Nation Entertainment (NYSE:LYV) – Live Nation is forecast to benefit from growing demand for live shows and entertainment despite regulatory and economic concerns. Evercore ISI analyst Ashton Welles upgraded shares to Outperform from In Line with a $100 price target on Thursday due to continued consumer interest in live experiences. The company plans to release its third-quarter results soon, with expectations of revenue growth despite economic challenges. Although they face regulatory risks, analysts consider these concerns to be less likely to materialize.
Earnings
Amazon (NASDAQ:AMZN) – Shares of the leading online commerce company rose more than 5% in pre-market trading on Friday after it presented sales estimates for the final quarter that ranged between $160 billion and $167 billion, while analysts interviewed by LSEG predicted revenues of approximately US$166.6 billion. Amazon beat analysts’ expectations for earnings and performance in the third quarter.
Intel (NASDAQ:INTC) – Shares posted a rise of more than 7% in pre-market trading after the semiconductor chip manufacturing company beat third-quarter earnings expectations. Intel posted an adjusted profit of 41 cents per share on revenue of $14.16 billion, while analysts surveyed by LSEG predicted a profit of 22 cents per share on revenue of $13.53 billion.
Ford Motor (NYSE:F) – The automaker’s shares suffered a 2.7% drop in pre-market trading after Ford missed third-quarter profit expectations. Ford announced adjusted earnings of 39 cents per share on revenue of $41.18 billion, falling short of the 45 cents per share and $41.22 billion in revenue expected by analysts surveyed by LSEG.
Mobileye Global (NASDAQ:MBLY) – Mobileye Global beat quarterly profit estimates, driven by continued demand for its autonomous driving technology. The company adjusted its annual operating loss forecast, now expecting a loss of between $62 million and $79 million, instead of the previous $98 million to $129 million.
Enphase Energy (NASDAQ:ENPH) – The value of shares of solar energy companies fell more than 20% in pre-market trading after Enphase Energy presented a pessimistic outlook. The company projected fourth-quarter revenue in the range of $300 million to $350 million, while analysts surveyed by LSEG were expecting $584 million.
Honeywell (NASDAQ:HON) – Honeywell International beat estimates in the third quarter, with earnings of $2.27 per share on sales of $9.3 billion. The company lowered its 2023 earnings per share forecast to $9.10 to $9.20 while maintaining estimated sales of about $37 billion.
Ameriprise Financial (NYSE:AMP) – Ameriprise Financial, despite a challenging environment, reported strong growth in its wealth management unit in the third quarter, with adjusted net revenues of $2.41 billion, an increase of 13% year-on-year, driven by higher investment gains and client asset growth. GAAP net income fell 18% to $872 million, reflecting a decline in wealth management cash balances. Analysts highlight the company’s “robust wealth management results.”
Capital One (NYSE:COF) – The financial services company reported third-quarter results that exceeded expectations. Earnings per share reached US$4.45, in contrast to the US$3.24 per share predicted by analysts surveyed by FactSet. Furthermore, net interest income reached US$9.37 billion, also exceeding the consensus of US$7.28 billion.
Nomura Holdings (NYSE:NMR) – Nomura Holdings, Japan’s largest brokerage, reported a doubled net profit in the second quarter due to the domestic stock market and share offerings. Profit was US$235 million, driven by the investment banking sector.
Dexcom (NASDAQ:DXCM) – The company that makes medical devices for diabetic patients beat profit forecasts in the third quarter. Dexcom reported adjusted earnings per share of 50 cents on revenue of $975 million. That beat the expectations of analysts surveyed by FactSet, who had expected earnings of 34 cents per share on revenue of $939.6 million.
Sanofi (NASDAQ:SNY) – Shares of French pharmaceutical company Sanofi fell 16.1% in pre-market trading Friday after the company increased research and development spending and anticipated higher taxes. Its “Earnings per Corporate Share” is expected to fall to single digits next year due to rising R&D costs and tax changes. The company also plans to spin off its consumer healthcare business. Third-quarter results were slightly below analyst estimates.
Kenvue (NYSE:KVUE) – Kenvue is facing declining sales due to the delayed flu season, resulting in a downward revision of its annual profit projections. The company’s value in the third quarter exceeded analysts’ expectations. The company lowered its upper full-year profit estimate to $1.28 per share, keeping the lower bound at $1.26 per share, due to weak sales in China and the strong dollar.
Chipotle Mexican Grill (NYSE:CMG) – The burrito restaurant chain reported earnings results that exceeded Wall Street expectations, according to an analyst survey conducted by LSEG. Adjusted earnings per share were US$11.36, exceeding the US$10.55 per share forecast, while revenue was in line with expectations, totaling US$2.47 billion.
Deckers Outdoor (NYSE:DECK) – The company behind the Ugg boot and Hoka sneaker brands projected full-year earnings per share in the range of $22.90 to $23.25 on revenue of $4.025 billion. This exceeded the forecasts of analysts surveyed by LSEG, who expected a profit of US$22.64 per share and revenue of US$4.015 billion. Furthermore, the company also surpassed Wall Street’s expectations in terms of profit and performance in the fiscal second quarter. Shares are flat in pre-market trading.