US Index Futures pull back as investors pick up on a raft of weak economic indicators in Europe. Ore extends gains, but oil is traded in decline, without extending the momentum seen after the commitment to cut supply by Saudi Arabia. The drop in oil prices has weighed on energy stocks and Apple is on track to extend losses from the previous session.
By 6:51 AM, Dow Jones (DOWI:DJI) futures were down 44 points, or 0.13%. S&P 500 futures were down 0.12%, while Nasdaq-100 futures were down 0.09%. The 10-year Treasury yield was at 3.668%. West Texas Intermediate crude fell 2.27% to settle at $70.51 a barrel.
In Germany, the largest economy in the Euro Zone, industrial orders fell by 0.4% in April, in contrast to the consensus that pointed to an increase of 3% and after a decrease of 10.9% in the previous month. Construction sector data also weigh. The Eurozone construction sector HCOB Purchasing Managers’ Index fell to 44.6 in May 2023 from 45.2 the previous month, indicating the most significant monthly decline in overall construction activity so far in 2023.
The Australian Dollar rose after the Reserve Bank of Australia promoted its 12th interest rate hike, raising the base rate by 25 percentage points to 4.10%.
In commodities, the Brent oil futures contract for August retreated with concerns about demand overshadowing the impact of the decision of Saudi Arabia, which announced on Sunday a voluntary cut in production to support prices. The Brent contract for August was down 1.60% at US$75.50 a barrel.
The iron ore futures contract extended the high and rose 1.32% to 766.50 yuan, or the equivalent of US$107.66, on the Chinese Dalian Exchange.
US wheat futures were up 3.59% to $6.46 a bushel, moving further away from the two-year low of $5.9 hit on May 30 after the destruction of the Kakhovka dam, in southern Ukraine. The dam broke on Tuesday, flooding swathes of territory and threatening water supplies crucial to cooling the Zaporizhzhia nuclear power plant. Russia and Ukraine exchanged accusations about the cause of the break.
On Tuesday’s schedule of US economic indicators, the change in API oil inventories will be released at 4:30 pm.
At the close of Monday, the main US stock Indexes ended lower, with the S&P 500 reversing initial gains, when it reached a record high in nine months. The Dow fell 199.90 points, or 0.59%, to close at 33,562.86 points. The S&P lost 0.20% to close at 4,273.79 points, while the Nasdaq Composite crose 0.09% to close at 13,229.43 points. Apple shares also lost early session gains as they renewed their record high ahead of the launch of an augmented reality headset called the Apple Vision Pro at the annual developer conference. Apple also announced this afternoon that the Mac Pro notebook will now be equipped with the M2 Ultra chip, essentially a combination of Apple’s two larger M2 chips. The Mac Pro was the last computer in Apple’s lineup that still used an Intel chip. Shares in Intel, which supplies processors to computer makers, fell 4.63% on Nasdaq. On the NYSE, shares of Goldman Sachs and JPMorgan fell 0.57% and 0.98%, respectively, on the release of news about studies by regulators to increase capital requirements of large banks.
Wall Street Corporate Highlights for Today
Apple (NASDAQ:AAPL), Meta Platforms (NASDAQ:META) – Apple announced its new augmented reality headset, the Vision Pro, challenging Meta and its market dominance. The device will start at $3,499, three times as much as Meta’s most expensive headset. Apple emphasized the headset’s augmented reality capabilities and its potential in sports and entertainment areas.
Unity Software (NYSE:U) – Shares in Unity closed up 18.94% on Monday after Apple announced a partnership with the game developer for its new Vision Pro headset.
Microsoft (NASDAQ:MSFT) – Microsoft has agreed to pay $20 million to settle FTC allegations that the company illegally collected personal information from children without parental consent. The company has been accused of violating COPPA and has agreed to take steps to improve privacy protections on its Xbox system.
Intel (NASDAQ:INTC) – Intel is offering 35 million Class A shares of Mobileye (NASDAQ:MBLY), worth approximately $1.5 billion, reducing its voting interest in the autonomous technology company to approximately 98.7%. The sale comes amid fierce competition from chip makers Nvidia and Qualcomm. Goldman Sachs and Morgan Stanley act as joint ledgers in the sale of shares.
Palantir Technologies (NYSE:PLTR) – Shares in Palantir reached a 17-month high on Monday after the software company unveiled a multi-year contract worth up to $463 million with USSOCOM. Palantir confirmed that the contract is the result of a more than decade-long partnership with the US military, and that this award will allow USSOCOM to analyze large volumes of data to facilitate decision-making.
Gitlab (NASDAQ:GTLB) – Shares of Gitlab rose 26.55% in premarket trade after the software company beat profit expectations in its fiscal first quarter, provided an upbeat outlook and said customers were looking to its platform with artificial intelligence.
Thor Industries (NYSE:THO) – Thor Industries had a fiscal third quarter with lower profit and sales due to weakness in the RV market and remaining inventory at dealerships. Earnings were $120.7 million, or $2.24 per share, compared with $348.1 million, or $6.32 per share, in the prior-year period. Sales were $2.93 billion, down 37.1%. Demand declined as supply normalized and macroeconomic conditions took a toll on dealers and customers. Sales of towable and motorized trailers in North America also declined.
Sprinklr (NYSE:CXM) – Shares in Sprinklr were up about 3.6% premarket as the enterprise cloud software company beat analyst estimates in its fiscal first quarter and provided earnings and revenue forecasts for the year whole better than expected.
Zura Bio (NASDAQ:ZURA) – Shares in Zura Bio were up more than 20% premarket following the completion of an approximately $80 million financing. The company plans to use the funds to conduct Phase 2 clinical studies with ZB-106 to treat systemic sclerosis and hidradenitis suppurativa. CEO Someit Sidhu expressed enthusiasm at the progress made.
Alkermes (NASDAQ:ALKS) – Alkermes raised its full-year sales and profit forecasts due to a final award received in an arbitration proceeding relating to licensing agreements. Now they expect adjusted earnings of $1.34 to $1.57 per share and sales of $1.55 billion to $1.68 billion. The resolution strengthens the company’s financial position. The arbitration involved Janssen Pharmaceutica, a subsidiary of Johnson & Johnson.
IBM (NYSE:IBM) – According to IBM CEO Arvind Krishna, artificial intelligence (AI) will neither eliminate all jobs nor pose an existential threat. He claims that AI will create new jobs and believes that aggressive regulation is meaningless. Krishna also envisions the convergence of quantum computing and AI, opening up new possibilities for computational power.
General Motors (NYSE:GM) – GM announced it will invest more than $1 billion to modernize two plants in Flint, Michigan. GM is seeking a new contract with the United Auto Workers union, and the investment is aimed at securing jobs. The company was criticized by the union for outsourcing semiconductor production.
Ferrari (NYSE:RACE) – Ferrari Chief Executive Benedetto Vigna said the company has no plans to buy other sports car makers. He highlighted the importance of partnerships and stated that the company’s new assembly facility will be completed in June next year, with flexibility to produce different types of vehicles.
Stellantis (NYSE:STLA) – Automaker Stellantis and recycler Galloo are in exclusive negotiations to create a joint venture to recycle parts and materials from end-of-life vehicles. The partnership seeks to boost the circular economy and tackle the scarcity of raw materials in the automotive industry. The service will launch this year in France, Belgium and Luxembourg, with plans to expand across Europe. Stellantis has set ambitious targets for green materials and recycling revenue by 2030.
Tesla (NASDAQ:TSLA), Panasonic Holdings (USOTC:PCRFY) – Panasonic Holdings plans to increase production of batteries for electric vehicles by 10% at its Nevada plant, which it co-operates with Tesla, over the next three years. The decision follows plans to build new factories in North America for the production of Tesla 4680 battery cells. Tesla has expressed interest in acquiring all of Panasonic’s production capacity.
Qantas Airways Ltd (USOTC:QABSY) – Qantas CEO Alan Joyce sold A$16.9 million worth of airline stock ahead of his retirement in November. The sale follows the appointment of Vanessa Hudson as the next CEO.
United Airlines (NASDAQ:UAL) – According to Scott Kirby, CEO of United Airlines, the United States is going through a “trade recession”, but the consumer is strong. Demand for leisure travel is recovering faster than business travel. Kirby also expressed concerns about Russia’s restrictions on airspace affecting United Airlines routes. The situation has negatively impacted the airline’s ability to offer competitive flights.
Chevron (NYSE:CVX) – Chevron has commenced gas production at the Gorgon Stage 2 project off the coast of Western Australia. The project expands the existing subsea gas collection network and aims to supply liquefied natural gas (LNG) to Asian customers and the Australian domestic market. Chevron has a 47% interest in the Gorgon LNG project, along with Exxon Mobil, Shell and Japanese companies.
General Electric (NYSE:GE) – General Electric is offering 25 million shares of GE HealthCare Technologies (NASDAQ:GEHC), valued at more than $2 billion, through a debt-for-equity swap agreement. The bid is being led by Evercore ISI, Morgan Stanley, BofA Securities, Citigroup and Goldman Sachs.
Raytheon Technologies (NYSE:RTX) – Safran (USOTC:SAFRF) has confirmed that it is in talks with Raytheon for the possible acquisition of flight control and actuation activities. Details about a deal and the chances of completion are still uncertain.
KKR & Co Inc (NYSE:KKR), Circor International Inc (NYSE:CIR) – KKR & Co Inc has announced the acquisition of industrial machinery maker Circor International Inc in a $1.6 billion deal. KKR plans to take the company private and expand its presence in the flow control market. The offer represents a significant premium for Circor’s stock. The acquisition will allow KKR to leverage Circor’s customer base, including commercial airlines and the US Department of Defense.
TomCo Energy (USOTC:TMCGF) – TomCo Energy has announced changes to its option to acquire Tar Sands. The cash consideration was increased to US$17.25 million and the term of the option was extended. In addition, Tar Sands can sell its remaining stake to third parties starting July 1st. TomCo is seeking a financing package for subsidiary Greenfield to exercise the amended option.
UnitedHealth Group (NYSE:UNH), Amedisys (NASDAQ:AMED) – UnitedHealth Group offered $3.26 billion in cash to acquire Amedisys, challenging Option Care Health, which had made an all-stock offer. The deal would expand UnitedHealth’s presence in the home health care industry. The offer represents a 26% premium to the last Amedisys stock price.
3D Systems Corp (NYSE:DDD), Stratasys (NASDAQ:SSYS) – The battle for control of Stratasys intensified when 3D Systems submitted a higher value offer than the proposed merger with Desktop Metal. 3D Systems proposed $7.50 in cash and stock, totaling about $25 per Stratasys share. Upon completion, Stratasys shareholders would own 40% of the combined company and receive approximately $540 million in cash. The proposal was handed over to the Stratasys board on May 30.
Spotify (NYSE:SPOT) – Spotify will eliminate 200 jobs from its podcast unit in its second wave of layoffs. The restructuring comes after years of significant investment and brings the company in line with other companies that have also made job cuts. Spotify will merge Parcast and Gimlet studios into a single division called Spotify Studios.
GSK Plc (NYSE:GSK) – GSK announced that the United States Food and Drug Administration has accepted the filing of its cancer drug, Jemperli, in combination with chemotherapy, for the treatment of certain types of endometrial cancer in adult patients.
British American Tobacco (NYSE:BTI) – British American Tobacco (BAT) maintains its annual revenue and profit forecasts, confident of steady demand for vaping products and oral nicotine. The company said the number of non-fuel consumers grew by 900,000 in the first quarter, however the US performance was disappointing, but the company is taking steps to improve its market share.
Inditex (USOTC:IDEXY) – Investors are eyeing profit margins at Inditex, which owns Zara, for signs of weakness after strong results. The company will release its results soon, while rival H&M will update its sales in June. Inditex’s higher prices outside Spain may have boosted its margins, but they also make it vulnerable to currency changes. The company sees opportunities for expansion in the US.
Taiwan Semiconductor Manufacturing (NYSE:TSM) – TSMC is optimistic about talks to build a factory in Germany and is discussing subsidies with the country’s government. The Taiwanese company is looking to expand its presence in Europe. The European Union has approved a subsidy plan to increase chip manufacturing capacity in the region. TSMC is also investing $40 billion in a new manufacturing facility in the US state of Arizona. In other news, TSMC CEO CC Wei said on Tuesday that the chipmaker expects better performance in the second half of the year compared to the first. However, he predicts a 10% year-over-year drop in first-half revenue in US dollars.
BlackRock (NYSE:BLK) – Tony Tang, head of business at BlackRock Inc, is leaving the company after playing a key role in expanding operations in China. Susan Chan, BlackRock’s deputy head of Asia Pacific, will now directly oversee the onshore business in China. BlackRock views China as a significant opportunity for its financial future.
Accsys Technologies (USOTC:ACSYF) – Jelena Arsic van Os will be the new CEO of Accsys Technologies effective July 1st. Stephen Odell, who previously served as interim executive chairman, will return to serve as independent non-executive chairman. Arsic van Os will join the board on 27 June.
Snap Inc (NYSE:SNAP) – Snap Inc. hired Eric Young, a former Google engineer, as senior vice president of engineering. He will receive an annual salary of $1 million, a signing bonus of $500,000 and restricted stock units worth at least $40 million. Young has held positions at Google and Amazon.com.