U.S. index futures are mixed in Thursday’s pre-market, reflecting a scenario influenced by both divergent quarterly results and unfavorable economic indicators emerging from China. Investors are eagerly focusing on the upcoming speech by Jerome Powell, Chairman of the Federal Reserve, in search of signals that could guide market trends.
At 06:34, Dow Jones futures (DOWI:DJI) rose by 47 points, or 0.14%. S&P 500 futures rose by 0.06%, and Nasdaq-100 futures fell by 0.11%. The yield on 10-year Treasury bonds stood at 4.531%.
In the commodities market, West Texas Intermediate crude oil for December rose by 0.54% to $75.74 per barrel. Brent crude oil for January increased by 0.57%, nearing $79.99 per barrel. Iron ore with a 62% concentration traded on the Dalian exchange rose by 1.79%, priced at $128.73 per ton.
On the economic agenda for Thursday, investors are awaiting the weekly jobless claims data at 08:30 AM, with a forecast of 218 thousand new claims. At 09:30 AM, Atlanta Fed President Raphael Bostic will give a speech, while Richmond Fed President Thomas Barkin speaks at 11:00 AM. At 13:00 PM, the U.S. government will conduct another Treasury auction, this time with a 30-year maturity. Yesterday, the 10-year auction, with a value of $40 billion, had a stop-out yield of 4.519%.
In Asian markets, the session ended without a unanimous direction, influenced by China’s modest 0.20% decrease in October year-on-year inflation. Adding to the picture in China, the financial market regulatory authority is urging brokerages to implement restrictions on margin trading in stock operations. In Japan, growth in line with expectations was observed in bank loans, which saw an increase of 2.80% compared to the same period last year.
Meanwhile, in Europe, attention is turning to the highly anticipated intervention by Christine Lagarde, President of the European Central Bank (ECB), scheduled for 12:30 PM.
U.S. stocks had an indecisive trading day on Wednesday, with major indices fluctuating around stability. The Dow Jones fell 0.12%, closing at 34,112.27, while the S&P 500 rose 0.10%, ending at 4,382.78. The Nasdaq Composite advanced 0.08%, reaching 13,650.41. Despite the volatility, both the Nasdaq and the S&P 500 extended their winning streaks, with the latter achieving its best closing in a month. The market remained optimistic about interest rates, and Jerome Powell’s comments did not address monetary policy.
In the corporate earnings front for Wednesday, investors will be watching for reports from Li Auto (NASDAQ:LI), Novavax (NASDAQ:NVAX), Oatly (NASDAQ:OTLY), Fiverr (NYSE:FVRR), Yeti (NYSE:YETI), Tapestry (NYSE:TPR) before the market opens. After the closing bell, we expect reports from Unity (NYSE:U), TheTradeDesk (NASDAQ:TTD), Wynn Resorts (NASDAQ:WYNN), Navitas (NASDAQ:NVTS), Petrobras (NYSE:PBR), and others.
Wall Street Corporate Highlights for Today
Nvidia (NASDAQ:NVDA) – Nvidia plans to launch three new chips for the Chinese market after the U.S. blocked the sale of AI and gaming chips. The announcement is expected on November 16.
Apple (NASDAQ:AAPL) – An adviser to the European high court has stated that a lower court that supported Apple in its challenge against a $14 billion EU tax order made legal errors and must review the case, representing a possible setback for the company. Additionally, Apple co-founder Steve Wozniak has been hospitalized in Mexico City. Mexican media reports suggest the issue could be a stroke or a less severe vertigo. Steve Wozniak was scheduled to speak at the World Business Forum event.
Amazon (NASDAQ:AMZN) – Amazon.com has confirmed job cuts in its Music division, amid a series of layoffs that have affected more than 27,000 employees in the past year. The company has not disclosed the number of affected employees but highlighted that it will continue to invest in Amazon Music. Additionally, Amazon is investing millions in a large language model (LLM) called “Olympus,” with 2 trillion parameters, aiming to compete with models from OpenAI and Alphabet. The initiative is led by Rohit Prasad and could strengthen Amazon’s offering in AWS.
Netflix (NASDAQ:NFLX), Warner Bros. Discovery (NASDAQ:WBD), Paramount Global (NASDAQ:PARA) – Shares rose as a result of a provisional agreement between Hollywood actors and major studios and streaming companies. Warner Bros. rebounded 2.9% after a 19% drop the previous day, primarily due to strikes in Hollywood, which contributed to a larger-than-expected quarterly loss. Union members are expected to vote on ratifying the three-year agreement in the coming days.
Novo Nordisk (NYSE:NVO) – Novo Nordisk has announced that it will discontinue the sale of its long-acting insulin, Levemir, in the U.S. due to manufacturing restrictions and availability of alternatives. The discontinuation will begin in January 2024. The company also offers the long-acting insulin Tresiba in the market.
Eli Lilly (NYSE:LLY) – The FDA has approved Eli Lilly’s obesity treatment, Zepbound, which will compete with Novo Nordisk’s Wegovy. Lilly has set a lower list price for Zepbound in an attempt to expand access.
Caesars Entertainment (NASDAQ:CZR) – Hospitality worker unions in Las Vegas have reached a “historic” preliminary agreement with Caesars Entertainment for a new contract covering 10,000 employees, avoiding an imminent strike. The five-year agreement includes salary increases, health benefits, and pensions. The city is preparing for major events, including the Formula 1 Las Vegas Grand Prix.
Domino’s Pizza (NYSE:DPZ) – Domino’s Pizza Group reported a decline in meal deliveries in the third quarter as customers reduced orders due to rising living costs. The group also faced a decrease in total orders and increased product prices in response to higher costs.
Tesla (NASDAQ:TSLA) – Tesla will recall 159 Model S and Model X vehicles due to the possibility of the driver’s airbag deploying incorrectly, increasing the risk of injury in the event of an accident, according to the National Highway Traffic Safety Administration (NHTSA) on Thursday.
General Motors (NYSE:GM), Stellantis (NYSE:STLA) – GM and Stellantis have invested $7 million and $5 million, respectively, in startup Niron Magnetics, with the aim of developing magnets for electric vehicles without relying on rare earth materials, a move to reduce dependence on China for critical materials. The initiative aims to create efficient permanent magnets using more abundant materials, reducing environmental impact.
Polestar (NASDAQ:PSNY) – Swedish electric vehicle manufacturer Polestar has lowered its 2023 delivery forecast and cut its gross margin target due to concerns about slowing demand for electric vehicles and global economic uncertainties. It now expects to deliver about 60,000 vehicles this year, with a gross margin of 2% in 2023.
Deutsche Bank (NYSE:DB) – Deutsche Bank is increasing its investments in the Asia-Pacific region to attract European clients and take advantage of stronger economic growth compared to other regions. CEO Christian Sewing highlighted the growing demand for consulting services in the region and the search for alternatives to U.S. banks. The bank is also expanding its team in Asia.
UBS (NYSE:UBS) – UBS raised $3.5 billion in its first Additional Tier 1 (AT1) bond sale since acquiring Credit Suisse, with demand exceeding $26 billion, signaling recovery and confidence following a bailout that impacted the risky bank debt market.
Citigroup (NYSE:C) – Citigroup has agreed to pay $25.9 million to settle charges by the U.S. Consumer Financial Protection Bureau (CFPB) of intentional discrimination against credit card applicants of Armenian origin based on their last names ending in “ian” and “yan.” The penalty includes a civil fine of $24.5 million and $1.4 million in restitution to affected applicants.
HSBC (NYSE:HSBC) – HSBC plans to launch a custody service for blockchain-based assets, excluding cryptocurrencies, in partnership with Swiss company Metaco. The service will allow institutional clients to store tokens representing traditional financial assets. The bank previously launched the HSBC Orion platform for tokenized digital assets.
Bank of America (NYSE:BAC) – Bank of America CEO Brian Moynihan predicts a soft landing for the U.S. economy, avoiding a recession, despite slowing consumer spending and commercial lending. He stated that the U.S. economy is expected to grow by 2.7% this year and 0.7% in 2024, with expectations of rising interest rates by the Federal Reserve and a reduction in inflation by the end of 2025. Moynihan also mentioned a “tremendous pipeline of activity” in the investment banking area.
JPMorgan Chase (NYSE:JPM) – JPMorgan is investing approximately $60 million in women-led private investment firms in France, in partnership with Bpifrance, the French state investment bank. The goal is to raise between €150 million and €200 million by the end of 2024.
BNY Mellon (NYSE:BK) – The proposed U.S. SEC reform to boost central clearing in the Treasury bond market needs to be implemented gradually to avoid disruptions in an already volatile market environment, warns BNY Mellon. The rule aims to require more Treasury bond trades to be cleared by a clearinghouse, but its rapid implementation could disrupt market functioning.
Robinhood Markets (NASDAQ:HOOD) – Robinhood plans to launch trading in the UK by the end of the year, despite the ban on payment for order flow in the country. The practice represented over 80% of the company’s revenue in some quarters in the U.S., but it now seeks to profit from other sources, including securities lending, margin lending, and premium services. The expansion into the UK is a test of its ability to thrive without payment for order flow.
Earnings
Disney (NYSE:DIS) – Disney’s stocks rose 4.1% in Thursday’s pre-market after the company exceeded analysts’ expectations for profit in the fiscal fourth quarter. The company also surpassed FactSet’s consensus forecast for total Disney+ subscribers while reaffirming the expectation that its streaming business will be profitable in the fiscal fourth quarter of 2024.
Sony (NYSE:SONY) – Sony’s operating profit fell 29% in the September quarter due to weak performance in image sensors and finances. Profit stood at $1.74 billion, below estimates. The chip division saw a 37% decline. Sony maintained its sales target for the PlayStation 5 and annual operating profit forecast, and announced an adaptation of Marvel’s “Spider-Man 2.” Sony’s stocks dropped 5.9% in Thursday’s pre-market.
Arm (NASDAQ:ARM) – Arm’s stocks fell 5.9% in the pre-market after the semiconductor company’s first earnings report as a public company. Investors paid more attention to the weak revenue outlook, with Q2 fiscal revenue rising 28% to $806 million. Adjusted earnings of 36 cents per share exceeded expectations of 26 cents per share. The company recorded a net loss of $509 million for the quarter due to stock-based compensation costs for employees.
Twilio (NYSE:TWLO) – The cloud technology company’s stocks rose 5.8% in the pre-market after exceeding Wall Street expectations in the third quarter and providing a strong outlook for the current quarter. Twilio reported earnings of $0.58 per share, excluding items, with revenue of $1.03 billion, surpassing LSEG analysts’ forecasts, which expected earnings of $0.35 per share and revenue of $989 million.
Take-Two Interactive (NASDAQ:TTWO) – Take-Two Interactive reported adjusted revenue of $1.44 billion in the second quarter, in line with expectations, with a focus on details about the next Grand Theft Auto title. Despite meeting profit estimates, the company provided a lower-than-expected adjusted revenue outlook of $1.3 billion to $1.35 billion for the fourth quarter, below the average expectation of $1.43 billion. However, it reaffirmed its full-year adjusted revenue outlook, between $5.45 billion and $5.55 billion.
Virgin Galactic (NYSE:SPCE) – Virgin Galactic’s stocks rose approximately 10.3% in the pre-market after the space tourism company announced quarterly results showing a reduced loss and increased revenue. Virgin Galactic plans to raise seat prices to around $1 million and change the Unity spaceflight schedule to quarterly in 2024, focusing on Delta flights and Delta vehicle development. Projected revenue for Galactic flights 6 and 7 is $2 million to $2.5 million per flight, four times higher than in the third quarter. The company also confirmed plans to launch the Delta Class spacecraft in 2026.
Li Auto (NASDAQ:LI) – Li Auto announced a profit of $386 million in the third quarter, with revenue of $4.75 billion, exceeding analysts’ expectations. Its stocks rose 3.6% in the pre-market. The company forecasts fourth-quarter revenue between $5.27 billion and $5.4 billion, surpassing FactSet’s estimate of $4.91 billion. Li Auto’s stocks have risen 93% this year.
Honda Motor (NYSE:HMC) – Japan’s Honda Motor (7267.T) reported a 31% increase in operating profit ($2 billion) in the September quarter, driven by stronger sales in the US and a weaker yen, raising its annual operating profit forecast by 20%.
Lyft (NASDAQ:LYFT) – Lyft’s stocks fell 1.3% in the pre-market after third-quarter bookings fell below expectations despite 15% growth. This overshadowed the fact that Lyft exceeded both revenue and profit expectations in the third quarter. Revenue grew 10% to $1.16 billion, surpassing analysts’ average estimate of $1.14 billion. Adjusted third-quarter profit was 24 cents per share, compared to estimates of 13 cents.
Instacart (NASDAQ:CART) – The food delivery platform exceeded Wall Street expectations in its first earnings report as a public company. Third-quarter revenue increased to $764 million, surpassing analysts’ consensus forecast of $737 million.
Applovin (NASDAQ:APP) – Applovin announced strong quarterly results, with a net profit of $107.9 million, exceeding analysts’ expectations. The company also exceeded revenue forecasts, reaching $864 million, and its stocks rose 16.4% in the pre-market. Applovin’s President and Chief Financial Officer, Herald Chen, plans to transition to new career opportunities by the end of 2023 but will continue to serve as a board member and advisor to the CEO. Matt Stumpf will assume the role of CFO.
Affirm (NASDAQ:AFRM) – Affirm, the “buy now, pay later” company, exceeded Wall Street expectations in the first fiscal quarter with a 28% increase in merchandise volume to $5.6 billion and revenue of $497 million, along with a loss of $0.57 per share. Stocks rose 14% in the pre-market.
AMC Entertainment (NYSE:AMC) – AMC Entertainment exceeded third-quarter revenue estimates, driven by the success of films such as “Barbie” and “Oppenheimer.” Attendance in movie theaters increased by 38.4%, and revenue reached $1.41 billion, marking the most successful quarter in the company’s 103-year history.
MGM Resorts (NYSE:MGM) – MGM exceeded market estimates for profit and revenue in the third quarter, with eased entry restrictions boosting performance, especially in its MGM China subsidiary. MGM’s global revenue increased by approximately 16% to $3.97 billion, surpassing analysts’ average estimate of $3.87 billion, according to LSEG data. Earnings per share in the quarter were $0.64, exceeding expectations of $0.49.
Duolingo (NASDAQ:DUOL) – The language learning platform saw an 8.8% increase in the pre-market after surpassing expectations for the third quarter and providing better-than-expected guidance for the current quarter. Duolingo told investors to expect revenue between $145 million and $148 million in the fourth quarter, while FactSet analysts predicted $141.2 million. The company also stated that bookings for the quarter are expected to range from $167 million to $170 million, exceeding FactSet analysts’ forecast of $157.7 million.
AstraZeneca (NASDAQ:AZN) – AstraZeneca raised its annual profit forecast due to demand for cancer drugs and invested up to $2 billion in a weight loss medication. Third-quarter revenues of $11.49 billion were slightly above the consensus forecast of $11.47 billion, boosting its stocks by 2.7% in the pre-market.
ArcelorMittal (NYSE:MTCN) – ArcelorMittal reported third-quarter profits above expectations, highlighting an improvement in structural profitability. The company forecasts global steel demand growth, excluding China, of 1% to 2% this year but reduced its outlook for Europe due to weak construction activity. The world’s second-largest steelmaker reported EBITDA of $1.87 billion, above analysts’ average forecast of $1.8 billion.
Topgolf Callaway Brands (NYSE:MODG) – The golf equipment manufacturer and operator of the Topgolf recreational driving range network saw stocks fall 19.7% in the pre-market due to a challenging third quarter.