U.S. index futures are down this Tuesday during the pre-market period, reflecting investor caution. They eagerly await the release of quarterly results from major U.S. companies, as well as the publication of the minutes from the most recent meeting of the Federal Open Market Committee (FOMC), scheduled for 2 PM.
At 6:05 AM, Dow Jones futures (DOWI:DJI) fell 64 points, or 0.18%. S&P 500 futures dropped 0.13% and Nasdaq-100 futures fell 0.04%. The yield on 10-year Treasury bonds was at 4.408%.
In the commodities market, West Texas Intermediate crude oil for January fell 0.42% to $77.50 per barrel. Brent crude oil for January fell 0.45% to around $81.95 per barrel. Iron ore with a 62% concentration, traded on the Dalian exchange, rose 1.34% to $132.85 a ton, the highest value since March 15.
There is also an expectation for the release of economic data throughout the day, the October economic activity index at 08:30 AM. At 10 AM, it will be the turn of existing home sales, projected at 3.9 million in October, while at 4:30 PM, the API will release the weekly oil stock.
European markets showed mixed performances, amidst anticipation for the FOMC minutes and news of the UK public sector net borrowing reaching £14.9 billion in October, the second highest since 1993. The British Finance Minister, Jeremy Hunt, may announce tax cuts soon, seeking economic growth.
In Asia, stock markets displayed mixed trends on Tuesday. While China’s Shanghai SE index and Japan’s Nikkei experienced slight declines of 0.01% and 0.10%, respectively, South Korea’s Kospi rose by 0.77%, boosted by electronics stocks. Hong Kong’s Hang Seng fell by 0.25%, affected by the technology sector, and Australia’s ASX 200 saw an increase of 0.28%. Market movements were influenced by a variety of factors, from signs of support for the real estate sector to the strength of the yen and demand for semiconductors.
U.S. stocks rebounded on Monday, with the Nasdaq climbing 1.1% and reaching its best close since July. The Dow Jones and the S&P 500 also saw significant gains. This advance reflected investor optimism over stabilizing interest rates and signs of slowing inflation, with expectations that the Fed will keep rates stable until 2024. Bond yields fell after a bond auction, while sectors like tobacco, software, airlines, and semiconductors performed notably.
In Tuesday’s corporate earnings front, investors will be keen on reports from Kohl’s (NYSE:KSS), Best Buy (NYSE:BBY), Lowe’s (NYSE:LOW), Medtronic (NYSE:MDT), Baidu (NASDAQ:BIDU), Burlington (NYSE:BURL), American Eagle (NYSE:AEO), Dick’s Sporting Goods (NYSE:DKS), before the market opening. After the close, the reports from Nvidia (NASDAQ:NVDA), Hewlett-Packard (NYSE:HPQ), among others will be observed.
Wall Street Corporate Highlights for Today
Microsoft (NASDAQ:MSFT) – Microsoft secured its leadership in AI by hiring Sam Altman and other top employees from OpenAI. This prevents a possible departure to competitors and strengthens its position in the AI race. Microsoft might also attract about 500 employees from OpenAI, despite concerns over the startup’s stock valuation. The team led by Altman at Microsoft will have access to more computational resources, owing to Microsoft’s position as a major cloud player.
Amazon (NASDAQ:AMZN) – The Spanish union CCOO called for a one-hour strike per shift at Amazon on November 27, “Cyber Monday,” seeking better wages and working conditions. The strike will also occur the next day. Moreover, three female employees of Amazon filed a lawsuit alleging gender discrimination and pay inequality on Monday.
Alibaba (NYSE:BABA) – Alibaba Group canceled its cloud services listing citing U.S. restrictions on semiconductors, highlighting a global chip shortage. This creates a divide between companies with access to necessary GPUs for AI and those without. Alibaba, despite substantial resources, faces competitive challenges in AI.
Nvidia (NASDAQ:NVDA) – Nvidia’s shares closed at a record of $504.20 on Monday before the third-quarter fiscal results, which will be released today, with expectations of a significant increase in revenue. The earnings call may provide valuable insights into the generative AI market.
Taiwan Semiconductor Manufacturing (NYSE:TSM) – TSMC is considering building a third factory in Japan, producing 3-nanometer chips, potentially making the country a global hub for chip manufacturing. TSMC is already building a factory in Japan for less advanced chips and is investing in factories in the U.S. and Germany.
Petrobras (NYSE:PBR) – The Brazilian government is considering replacing Petrobras CEO Jean Paul Prates, due to concerns about the company. President Lula expressed dissatisfaction with Prates’ management and called for adjustments in the investment plan to prioritize local jobs. Tensions regarding fuel prices have also emerged. No immediate replacement has been announced.
Uber Technologies (NYSE:UBER) – Uber Technologies increased its convertible bond offering to $1.5 billion, reflecting strong investor demand. The offering was priced with a coupon of 0.875% and a conversion premium of 32.5%, indicating strong market optimism for the company.
Tesla (NASDAQ:TSLA) – Tesla Inc. announced a price increase for the Model Y long-range in China, raising it to $42,212.70 as of Tuesday.
Fisker (NYSE:FSR) – Florus Beuting, Fisker’s chief accounting officer, resigned just two weeks after his appointment. He took up the role on November 6 to succeed John Finnucan, who left the company amid issues related to internal controls over financial reporting.
Rivian Automotive (NASDAQ:RIVN) – Rivian Automotive announced that its CEO RJ Scaringe will directly oversee product development, preparing to unveil a new line of vehicles. The head of product development, Nick Kalayjian, will assume an executive role before transitioning to a consulting role in 2024.
Nio (NYSE:NIO) – Nio and Changan Automobile have entered into an agreement to collaborate on electric vehicle battery swapping, representing another partnership between EV startups and traditional manufacturers, aiming for expansion and joint technological development.
Toyota Motor (NYSE:TM) – Toyota agreed to pay $60 million to settle charges by the U.S. regulator, the Consumer Financial Protection Bureau (CFPB), that it prevented car buyers from canceling unwanted product bundles. This includes a civil fine of $12 million and $48 million to compensate affected buyers since 2016. Toyota also agreed to make it easier to cancel these products and to closely monitor dealer activities.
Stellantis (NYSE:STLA) – Stellantis and CATL signed a preliminary agreement to supply battery cells and modules for electric vehicles in Europe, including the possibility of a joint venture. Stellantis is also building gigafactories in Europe to meet EV battery demands. Additionally, Stellantis will start negotiations in December with the Italian government to increase annual vehicle production to one million in Italy. The talks will address investments in innovation, supplier support, and will depend on government measures, such as emission regulations and incentives for electric vehicles.
General Motors (NYSE:GM) – GM does not plan to advertise in the 2024 Super Bowl, marking the first time since 2019 that it will not participate in the NFL game, as the company cuts marketing costs as part of a broader strategy to reduce fixed expenses.
Stellantis, General Motors (NYSE:GM), Ford Motor (NYSE:F), Tesla (NASDAQ:TSLA) – The United Auto Workers (UAW) announced that 64% of Detroit automakers’ workers ratified new contracts that include a 25% increase in base wages and improvements in benefits until April 2028. The union also plans to organize foreign automobile factories and Tesla.
Caesars Entertainment (NASDAQ:CZR) – The Culinary Workers and Bartenders Unions announced that 10,000 Caesars Entertainment workers in Las Vegas ratified a five-year contract. The landmark agreement includes reduced cleaning quotas, daily room cleaning, and expanded recall rights. Similar agreements with Wynn Resorts (NASDAQ:WYNN) and MGM Resorts International (NYSE:MGM) are up for vote. After seven months of negotiations, the planned November 10 strike in Las Vegas was averted.
Southwest Airlines (NYSE:LUV) – Andrew Watterson, Southwest Airlines’ chief operating officer, faces challenges to avoid travel disruptions during the holiday season following an operational breakdown last year. The company has invested in technology and training to cope with adverse weather conditions and increased traffic.
Citigroup (NYSE:C) – Citigroup continues its simplification strategy, eliminating over 300 senior management roles, part of a restructuring led by CEO Jane Fraser to speed up decision-making and align the structure with the strategy. The company plans further cuts globally over the next year. Additionally, Nacho Gutiérrez-Orrantia, a senior banker, will lead Citigroup’s banking and cluster sector in Europe as part of its restructuring. Citigroup also appointed Carmen Haddad, a Middle East veteran, as vice-chair to deepen operations in the region, focusing on senior dialogue and expansion in Saudi Arabia. Moreover, Citigroup is facing a sexual harassment lawsuit by a managing director who alleges death threats from a former stock market head. The bank denies and vows to defend itself.
Morgan Stanley (NYSE:MS) – Morgan Stanley recommends that investors focus on higher-quality corporate bonds, as the wave of maturities poses a risk for “junk” rated companies. Morgan Stanley anticipates a resumption in loan issuances next year for mergers and acquisitions.
Wells Fargo (NYSE:WFC) – Employees at two Wells Fargo branches filed for union elections, marking a rare effort in the U.S. financial sector. They seek unionization through the Wells Fargo Workers United (WFWU) of the Communications Workers of America. Wells Fargo has reinforced its commitment to improving wages and benefits for its employees.
Bank of America (NYSE:BAC) – Bank of America plans to move its Japanese headquarters to an eco-friendly tower under construction in Tokyo, aiming for a more modern space aligned with its 2050 sustainability goals.
UBS (NYSE:UBS) – The team of financial advisors led by Maureen Keating, Michael DeCorleto, Matthew Marques, and Matthew Mardirosian, who manage about $700 million in high-net-worth client assets, has joined UBS Wealth Management USA at the Hartford office, One State Street.
Blackstone (NYSE:BX) – Blackstone plans to close the Blackstone Diversified Multi-Strategy fund due to a nearly 90% drop in assets over four years. The closure is expected by the end of the year, according to Blackstone. Blackstone is discussing capital reallocation options with investors.
Bain Capital (NYSE:BCSF) – Bain Capital has closed its fifth pan-Asian private equity fund at $7.1 billion, exceeding its initial target of $5 billion despite geopolitical uncertainties. The fund’s focus is on Asia, with an emphasis on Japan, and in sectors like healthcare, information technology, entertainment, and consumer. Bain Capital manages about $180 billion in assets globally.
McDonald’s (NYSE:MCD) – McDonald’s will expand its stake in China, acquiring Carlyle’s share, confident in its growth. The deal, valued at about $6 billion, reflects the company’s ongoing momentum in the rapidly growing Chinese market.
Live Nation (NYSE:LYV) – Live Nation and its subsidiary Ticketmaster have received a subpoena related to ticket pricing, fees, and secondary sales from a U.S. Senate panel. The subpoena was due to Live Nation’s lack of cooperation in a previous investigation. The company claims to have provided extensive information and seeks confidentiality assurances before providing more.
Paramount Global (NASDAQ:PARA) – Paramount Global’s shares rose 1.5% in Tuesday’s pre-market amid speculation about a potential sale of the media company, following the disclosure of new employment deals with executives, which include change-of-control clauses. Paramount faces challenges in the streaming landscape and high debt.
Earnings
Baidu (NASDAQ:BIDU) – Baidu has exceeded financial expectations by diversifying into new fields like Artificial Intelligence, shielding itself from economic challenges. With a 6% increase in sales to $4.8 billion and a net profit of approximately $940.72 million for the quarter, the company stands out in a period of economic uncertainties. This progress, driven by its chatbot Ernie and expansion into essential products, challenges concerns about deflation in the Chinese economy and limited growth in the tech sector.
Zoom Video Communication (NASDAQ:ZM) – Zoom Video Communications’ shares are up 0.4% in Tuesday’s pre-market following impressive quarterly results, driven by growth in corporate clients and a reduction in individual user losses. Zoom reported an adjusted earnings of $1.29 per share, significantly exceeding expectations of $1.08 per share. Its revenue of $1.137 billion surpassed expectations, with the company projecting solid results for the next quarter and revising its annual forecasts upwards.
Keysight Technologies (NYSE:KEYS) – Keysight Technologies announced quarterly earnings above expectations, despite a challenging economic environment. The company recorded earnings of $1.99 per share, with revenue of $1.31 billion, predicting solid results for the next quarter. FactSet’s consensus called for adjusted earnings of $1.87 per share on sales of $1.3 billion.
Symbotic (NASDAQ:SYM) – Symbotic’s shares rose 23% in Tuesday’s pre-market after reporting a 25% increase in fourth-quarter revenue and exceeding adjusted profit expectations. The company projected first-quarter revenue between $350 million and $370 million, surpassing analyst forecasts and exceeding the previous year’s $206.3 million.
Agilent Technologies (NYSE:A) – Agilent Technologies’ shares rose 6.2% in Tuesday’s pre-market after announcing a net profit of $475 million last quarter, with adjusted earnings of $1.38 per share, beating estimates. However, revenue fell to $1.69 billion, with a notable 17% decline in the biosciences and applied markets group.