U.S. index futures signal a muted opening in Wednesday’s
pre-market as investors assess the impact of the recently released
inflation rate in Germany and review corporate earnings results.
The market is on hold, awaiting remarks from Jerome Powell, the
Federal Reserve Chairman, which could provide new clues on the
direction of monetary policy.
As of 06:29 AM, Dow Jones futures (DOWI:DJI) were up 24 points,
or 0.07%. S&P 500 futures rose 0.03%, and Nasdaq-100 futures
fell 0.03%. The yield on the 10-year Treasury notes was at
4.575%.
In the commodities market, West Texas Intermediate crude for
December fell 0.79%, to $76.76 per barrel. Brent crude oil for
January was down 0.65% near $81.08 per barrel. Iron ore with a 62%
concentration, traded on the Dalian exchange, rose 1.03% to $128.35
per ton.
On the economic agenda this Wednesday, investors await at 07 AM,
last week’s mortgage rate, while wholesale inventories, which are
expected to show stability for September, are out at 10 AM. The
U.S. government will conduct another Treasury auction at 1 PM.
Powell’s speech is awaited with some anticipation, as it may
confirm bets that U.S. interest rates will not rise further or
could even begin to fall by mid-2024. At 1:40 PM, a speech by the
New York Fed President, John Williams, is scheduled, while at 2 PM,
it will be the turn of Michael Barr, vice-chair of supervision at
the monetary authority. Finally, Fed Vice Chair Philip Jefferson
speaks at 4:45 PM.
In Asia, markets closed down, attentive to U.S. interest rate
policy and the upcoming inflation indicators from China, which
could reveal the impact of recent economic stimuli. In focus in the
country’s real estate sector, giant Country Garden is facing
liquidity issues, with insurer Ping An Insurance Group being urged
to step in.
In Europe, German inflation remained stable in October,
indicating a slowdown compared to the rise in September. Retail
sales in the eurozone experienced a sharp decline in September,
signaling challenges in the bloc’s economic recovery.
Speeches by European Central Bank officials are anticipated
today: Hernández de Cos at 7:30 AM and Andre Enria at 09 AM, which
could provide insights on the future direction of the bloc’s
monetary policy.
The stock markets in the United States recorded another day of
gains following conciliatory statements from members of the Federal
Reserve. The Dow Jones increased by 0.17%, while the S&P 500
and the Nasdaq Composite went up by 0.28% and 0.90%, respectively.
Specifically, Christopher Waller, one of the Fed’s leaders,
described the rise in long-term interest rates as a “jolt” in the
bond market. Concurrently, Michelle Bowman, also a Fed official,
expressed a dissenting opinion, advocating for a sharper increase
in interest rates. However, the impact of their statements was
limited, as their positions were already previously known. In
Europe, Huw Pill, the Chief Economist of the Bank of England,
indicated that interest rate cuts could occur in 2024.
On 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, reports
are expected from Unity (NYSE:U),
TheTradeDesk (NASDAQ:TTD), Wynn
Resorts (NASDAQ:WYNN), Navitas
(NASDAQ:NVTS), Petrobras (NYSE:PBR), among
others.
Wall Street Corporate Highlights for Today
Alphabet (NASDAQ:GOOGL), Apple
(NASDAQ:AAPL), PayPal (NASDAQ:PYPL),
Block (NYSE:SQ) – The US Consumer Financial
Protection Bureau (CFPB) proposed to regulate digital payments and
smartphone wallet services provided by tech giants like Alphabet,
Apple, PayPal, and CashApp, subjecting them to bank-like
supervision for consumer protection.
Meta Platforms (NASDAQ:META) – A former Meta
employee testified before a US Senate subcommittee, alleging that
the parent company of Facebook and Instagram was aware of the
harassment and harm faced by teenagers on its platforms but did not
take action. He revealed that 51% of Instagram users reported bad
or harmful experiences, including unwanted sexual advances.
Amazon (NASDAQ:AMZN) – Amazon’s chief lawyer,
David Zapolsky, outlined the company’s defense against the US FTC’s
antitrust lawsuit in an internal meeting. Zapolsky expressed
confidence in Amazon’s practices, citing Taylor Swift, and defended
the company against allegations of monopoly and illegal conduct.
Additionally, Amazon is investing millions in “Olympus,” an LLM
with 2 trillion parameters, aiming to compete with OpenAI and
Alphabet (NASDAQ:GOOGL). Led by Rohit Prasad, the team seeks to
bolster AWS offerings with high-performance in-house models.
Training LLMs is expensive, but Amazon is committed to its
generative AI while reducing its retail presence.
Microsoft (NASDAQ:MSFT) – Microsoft’s stock
reached a record high of $360.53, ending an eight-day streak of
gains, on the path to match its previous winning streak. The
company is an investor in OpenAI, and UBS analysts expressed
optimism after OpenAI’s developer conference, highlighting
potential benefits for Microsoft, especially for the Azure cloud
service.
Salesforce (NYSE:CRM) – Salesforce’s Dreamforce
conference will remain in San Francisco next year, following
threats of relocation. CEO Marc Benioff announced that the world’s
largest enterprise technology conference will return to the city,
emphasizing San Francisco’s importance as the World Capital of AI.
This year’s conference generated approximately $89.3 million in the
local economy.
Take-Two Interactive (NASDAQ:TTWO) – Shares of
Take-Two Interactive Software rose by 7.9% in pre-market trading
after news of a possible announcement of Grand Theft Auto VI later
this week. The company’s gains have reached 31% this year.
Enovix (NASDAQ:ENVX) – Enovix’s shares rose by
14.3% in pre-market trading after the company forecasted
fourth-quarter sales between $3 million and $4 million, well above
expectations, driven by an acquisition and demand from the US
Army.
Sleep Number (NASDAQ:SNBR) – Sleep Number’s
shares plunged more than 30% in pre-market trading following an
unexpected quarterly loss and a full-year loss forecast. The
company also initiated a cost-cutting plan, including layoffs and
store closures, in response to weakened demand. Additionally, it
appointed two new board members as part of an agreement with
shareholder Stadium Capital Management LLC.
WeWork (NYSE:WE) – The $3 billion
debt-for-equity swap of WeWork with its creditors is an effort by
its major shareholder, SoftBank, to revitalize the company. Success
depends on renegotiating burdensome lease contracts that led to its
near-collapse. While WeWork has renegotiated some contracts, it
still faces financial challenges. SoftBank, despite its limited
exposure, has an interest in restructuring the company. Its stake
may be affected by the debt-for-equity swap agreement.
Frontier Communications Parent (NASDAQ:FYBR) –
Cerberus Capital Management is now the second-largest shareholder
of Frontier Communications Parent, with a 10% stake. Jana Partners
has also invested in Frontier and is seeking its sale. Ares
Management, with a 16% stake, plans to influence the company.
Frontier’s stock price has risen by 26.6% in the last month.
Sempra (NYSE:SRE) – The utility company
announced a proposal to issue $1 billion in common stock through
Morgan Stanley and Citigroup.
Goldman Sachs (NYSE:GS) – Goldman Sachs plans
to divest its General Motors (NYSE:GM) credit cards, and the
automaker will initiate a process to find a new card issuer.
Goldman seeks to focus on its traditional strengths, such as
investment banking and trading.
General Motors (NYSE:GM) – GM’s Cruise is
recalling 950 autonomous cars in the US due to collision detection
software issues following an accident. The company will deploy a
software update and make repairs before returning the vehicles to
service.
Toyota Motor (NYSE:TM) – Toyota will extend its
production reduction in its China joint venture for three months,
facing increased competition. The goal is to relieve pressure on
dealerships. Production will continue to be reduced from December
to February. Toyota’s sales to dealers will decrease to 66,000
units in December, 60,000 in January, and 38,000 in February. Sales
fell by 9% in the first nine months of this year.
Rivian Automotive (NASDAQ:RIVN) – Rivian has
increased its production forecast to 54,000 vehicles due to strong
demand. Rivian has focused on in-house motor manufacturing,
avoiding price cuts, and delivered above expectations in the third
quarter. Additionally, the company will end its exclusivity
agreement with Amazon (NASDAQ:AMZN) for electric delivery vans,
opening doors to more customers while maintaining the commitment to
fulfill Amazon’s order for 100,000 vans by 2030.
Lucid (NASDAQ:LCID) – Lucid Group has reduced
its production forecast to 8,000-8,500 vehicles this year, down
from the previous estimate of over 10,000, aligning with
deliveries. Its shares fell 3.5% in pre-market trading, and
third-quarter revenue fell short of analyst estimates, reaching
$137.8 million compared to estimates of $183.8 million.
Spirit AeroSystems (NYSE:SPR) – Spirit
AeroSystems announced a $200 million stock sale and a $200 million
convertible debt issuance to raise capital. Its shares fell by
14.1% in pre-market trading on Wednesday. The company faces quality
production issues, delivery delays, and rising costs.
Embraer (NYSE:ERJ) – Embraer is seeking to
promote its E195-E2 jet as a “small narrowbody” for North American
carriers, even with demand focused on its first-generation E175-E1
model. The company expects the E195-E2 to complement the operations
of larger narrowbody aircraft in the US.
Virgin Galactic (NYSE:SPCE) – Virgin Galactic
plans to cut personnel to focus on developing its new Delta
spaceplane class, which is expected to be more cost-effective and
profitable. The cuts reflect the need to reduce reliance on
volatile capital markets.
Earnings
Occidental Petroleum (NYSE:OXY) – Occidental
Petroleum’s shares increased by 1.4% in pre-market trading after
the energy sector company announced an adjusted profit of $1.18 per
share in the third quarter, surpassing analysts’ estimates of 88
cents per share, according to FactSet. Additionally, Occidental
raised its full-year production outlook.
Devon Energy (NYSE:DVN) – Devon Energy’s shares
fell by 1.2% in pre-market trading on Wednesday. In the third
quarter, Devon reported an adjusted profit of $1.65 per share,
exceeding analysts’ forecast of $1.56 per share, according to
FactSet. The company issued a new full-year production forecast,
setting it at 650,000 barrels of oil equivalent per day, a slight
variation from the previous guidance range of 643,000 to 663,000
barrels of oil equivalent per day.
Upstart Holdings (NASDAQ:UPST) – Upstart’s
shares dropped by 23.2% in pre-market trading due to the
announcement of an adjusted loss of 5 cents per share in the third
quarter, worse than analysts’ expectation of a 2-cent loss.
Additionally, revenue of $135 million fell short of the $140
million market expectations. The company also provided
fourth-quarter revenue projections that did not meet market
estimates.
eBay (NASDAQ:EBAY) – The stock of the major
e-commerce company fell by 6.4% in pre-market trading after
releasing third-quarter results. eBay generated $2.5 billion in
revenue, meeting analysts’ expectations, as reported by LSEG.
Additionally, adjusted earnings per share reached $1.03, surpassing
analysts’ forecast of $1 per share.
Robinhood (NASDAQ:HOOD) – The shares of the
company behind the trading app declined by 7.5% in pre-market
trading on Wednesday. In the third quarter, Robinhood reported
revenue of $467 million, which was below analysts’ expectations of
$478 million, as reported by LSEG.
Akamai Technologies (NASDAQ:AKAM) – The cloud
services company reported an adjusted profit of $1.63 per share in
the third quarter, along with revenue of $965.5 million. This
exceeded analysts’ forecasts, which expected a profit of $1.50 per
share and revenue of $943.9 million.
Extra Space Storage (NYSE:EXR) – Extra Space
Storage announced $748 million in revenue for the third quarter,
surpassing analysts’ expectations of $680.6 million.
Gilead Sciences (NASDAQ:GILD) – Gilead Sciences
reported a third-quarter profit of $2.29 per share, excluding
items, with revenue of $7.1 billion, primarily driven by lower
taxes. Sales of the HIV drug Biktarvy increased by 12%, while sales
of the COVID drug Veklury fell by 31%. The company raised its
full-year adjusted profit forecast and estimated a 16% tax rate for
2024.
DaVita (NYSE:DVA) – The healthcare company
announced an adjusted profit of $2.85 per share, with revenue of
$3.1 billion in the third quarter. These results exceeded analysts’
estimates of a profit of $2.01 per share and revenue of $3.02
billion, according to FactSet. Additionally, the company revised
its full-year adjusted profit projection, now expecting a range
between $7.80 and $8.30 per share, surpassing its previous guidance
of $7.00 to $7.80 per share.
Kyndryl (NYSE:KD) – Kyndryl’s shares are up by
10.1% in pre-market trading after the company reported $4.1 billion
in revenue for the third quarter, exceeding analysts’ estimates by
approximately $100 million. Kyndryl also reported adjusted earnings
before interest, taxes, depreciation, and amortization (EBITDA) of
$574 million, well above Wall Street’s consensus.
Toast (NYSE:TOST) – Toast, a company that
provides point-of-sale systems for restaurants, saw its shares drop
by 17.3% in pre-market trading. Toast reported a loss of 9 cents
per share in the third quarter, falling short of analysts’
expectations of a 10-cent profit per share, as reported by LSEG.
Revenue reached $1.03 billion, in line with market estimates.
Upwork (NASDAQ:UPWK) – Upwork’s shares saw a
19.9% increase in pre-market trading after the company exceeded
Wall Street expectations for third-quarter earnings and revenues on
its freelancing platform.
Array Technologies (NASDAQ:ARRY) – Array
Technologies’ shares fell by 11.8% in pre-market trading due to its
outlook for the full year falling below expectations. The company
projected revenues for 2023 in the range of $1.525 billion to
$1.575 billion, while analysts estimated revenues of $1.64
billion.
Bumble (NASDAQ:BMBL) – Bumble forecasted
fourth-quarter revenue below Wall Street expectations, citing
inflation and increased competition. The company faces competition
from rival Match Group (NASDAQ:MTCH) and notes a $1 million impact
due to the Middle East crisis. Bumble expects revenue between $272
million and $278 million for the fourth quarter, below analyst
estimates.
Spirit Aerosystems (NYSE:SPR)
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