Thursday’s Wall Street Highlights: Nvidia, Best Buy, Palantir, Snowflake and more

Market Summary
May 25th, 2023 9:10 am EST

US Index Futures are upbeat for a possible solution to the U.S. debt ceiling impasse, with S&P 500 futures posting a one-week high and technology stocks soaring after chipmaker Nvidia Inc. issued a bright revenue forecast. Dow Jones Industrial Average futures fell after Fitch Ratings placed top-rated US bonds on negative watch due to stalled talks to raise the debt ceiling, an announcement that underscores the urgency of a resolution.

By 7:09 AM, Dow Jones futures were down 84 points, or 0.26%. S&P 500 futures were up 0.60%, while Nasdaq-100 futures were up 1.82%. The 10-year Treasury yield was at 3.763%. West Texas Intermediate crude fell 1.96% to settle at $72.88 a barrel.

Nvidia is approaching a market capitalization of nearly $1 trillion, with earnings of nearly $200 billion in a single trading day. The chip company predicts significant revenue growth, driven by advances in artificial intelligence. Only six companies in the US have reached that milestone so far.

Fitch has placed the US AAA rating on negative watch due to the impasse over the debt ceiling. There are increasing risks of a possible default if the cap is not raised or lifted. The agency expects a deal, but points out that a default would be negative for governance and the AAA rating.

Thursday’s economic data agenda will be driven by first-quarter GDP data, in addition to the release of weekly jobless claims at 8:30 am. And Susan M. Collins, chairman of the Federal Reserve Bank of Boston, will speak at 10:30.

Elsewhere, Germany’s Gross Domestic Product (GDP) shrank in the first quarter of the year, meaning Europe’s biggest economy slipped into a mild recession. The federal statistics office said the German economy contracted 0.3% in the three months to March, adjusting its initial estimate of zero growth. Some economists had expected the move after German industrial production suffered its biggest drop in 12 months in March. A second consecutive quarterly decline in GDP – after a downwardly revised contraction of 0.5% in the last quarter of last year – is seen as a technical recession.

At the close of Wednesday, US stock markets fell following a global trend of risk aversion. the Dow fell 255.59 points, or 0.77%, to close at 32,799.92 points. The  S&P 500 was down  0.73% at 4,115.24 points, while the  Nasdaq Composite cup 0.61% at 12,484.16 points. The stalemate in US debt limit talks and divided support for rate hikes among Federal Reserve officials contributed to the worst sentiment in the US market. Minutes from the Federal Reserve’s May meeting revealed differing views among policymakers on the need for further rate hikes to fight inflation. The focus of the document, however, was to make it clear that the decision on whether or not to continue the increase cycle has not yet been taken, and all paths are possible in the next meetings. Meanwhile, talks between the Biden administration and the Speaker of the House have shown little progress, raising the risk of a US default and possible recession.

On the Thursday earnings front, traders are watching earnings from Best Buy, Dollar Tree, Medtronic, Ralph Lauren, Burlington, among others. After the market closes, reports from Costco, Ulta Beauty, AutoDesk, Marvell, Workday, Gap, HR, among others, will be awaited.

Wall Street Corporate Highlights for Today

Airbnb  (NASDAQ:PANW) – Airbnb is stepping up its anti-party measures during the US summer break. The “anti-party” system identifies high-risk short-term bookings and blocks those involving unauthorized guests. Neighbors are encouraged to report parties, and a global ban is already in effect.

Verizon  (NASDAQ:PANW) – Verizon held a meeting with customer service employees to advise of “restructuring” measures that are likely to result in significant layoffs. More than 6,000 employees participated, and the consolidation could impact even more. The company faces slumping demand and subscriber losses due to inflation and rising interest rates.

Sarepta Therapeutics   (NASDAQ:PANW) – The biotech company has disclosed that the Food and Drug Administration has pushed back its decision date on its gene therapy.

Palantir Technologies  (NASDAQ:PANW) – Palantir will intensify its collaboration with Ukraine to assist in the country’s reconstruction efforts, with a focus on restoring schools in war-torn areas. The company will provide software and artificial intelligence technology to help with decision-making. The partnership seeks to boost economic development and make Ukraine a technology hub in Europe.

Accenture Plc  (NASDAQ:PANW) – Accenture has secured an agreement worth up to $2.6 billion with the Internal Revenue Service (IRS) to modernize the government’s tax agency systems. The seven-year contract will require Accenture to compete for future orders to support the IRS in creating new interactions with taxpayers.

OpenAI – According to an SEC filing, OpenAI closed an investment fund worth more than $175 million. The fund, called OpenAI Startup Fund I, seeks to support startups that drive the positive impact of artificial intelligence. The company initially planned to invest $100 million in the fund.

Microsoft  (NASDAQ:PANW) – The European Union’s approval of Microsoft’s acquisition of Activision Blizzard, while the UK blocks the deal, raises “important questions”, said Margrethe Vestager, EU competition chief. Differences between regulators over drugs raise concerns and affect cooperation. The deal faces legal challenges in the UK and US.

Apple  (NASDAQ:PANW) – Apple plans a new interface for iPhones in iOS 17, displaying information such as calendar, weather and notifications similar to a smart home screen. Other improvements include changes to the Wallet app, health, and content sharing features via SharePlay and AirPlay. 

Alphabet  (NASDAQ:PANW) – Alphabet and the European Commission plan to develop an artificial intelligence (AI) pact before rules are set. Both have agreed to work together to create a voluntary AI pact, while the EU urges finalization of the proposed rules by the end of the year. Concern about the effects of AI is growing, and the EU is looking for a balance between control and innovation. 

Meta Platforms  (NASDAQ:PANW) – Meta Platforms Inc has made job cuts across its business units and operations as part of its plan to eliminate 10,000 roles. The second round of layoffs mostly hit non-engineering roles. The cuts affected around 490 employees at the Dublin headquarters and top executives in India were also sacked.

Amazon  (NASDAQ:PANW) – Amazon investors rejected all 18 shareholder-led proposals during the company’s annual meeting. These proposals addressed issues related to workers’ rights, unionization, diversity, animal welfare and more. The proposals are non-binding, but ESG investors continue to push for change. Amazon will report the final count later. Activist investor Tulipshare, which owns a small stake in the company, has proposed an independent audit of the warehouses and will seek additional meetings with Amazon. The company stated that it has engaged with many of its key investors.

Advanced Micro Devices  (NASDAQ:PANW)  (NASDAQ:PANW) – AMD and were up 9.7% and 9.91% respectively after Nvidia’s report.

Sony  (NASDAQ:PANW) – Sony will acquire land in Kumamoto, Japan, for its chip business, possibly to build an image sensor factory for smartphones.

WeWork  (NASDAQ:PANW) – WeWork CFO Andre Fernandez plans to step down on June 1, less than a year after taking the role. Kurt Wehner will take over as CFO, and Fernandez’s resignation was not the result of disagreements. WeWork has struck deals to reduce its debt and extend maturities recently as it seeks to achieve profitability. The company’s shares have dropped significantly this year, resulting in a significant reduction in its market value.

First Republic Bank  (NASDAQ:PANW) – US prosecutors are investigating possible stock trading by employees of First Republic Bank during its recent collapse. The Justice Department is looking into whether insider trading was involved during the second-largest bank failure in the US. Other banks are also under scrutiny.

Morgan Stanley  (NASDAQ:PANW) – A former financial adviser to Morgan Stanley is sentenced to more than seven years in prison for a decade-long Ponzi scheme. Shawn Edward Good has stolen millions of dollars from clients, using the funds to finance a luxurious lifestyle. He must pay restitution to the victims.

BlackRock  (NASDAQ:PANW) – BlackRock gained support from investors at its annual meeting, seeking balance in discussions around its ESG policies. Appointed directors received broad support, while climate and diversity resolutions had low uptake. The company faces criticism from activists and politicians. 

Bank of America  (NASDAQ:PANW) – Bank of America has told about 40 bankers in Asia Pacific that they must look for new jobs within the organization or face redundancy, as part of efforts to control costs and deal with a slowdown in Chinese business. The bank is looking to cut back in this area and keep overall headcount down globally.

HSBC  (NASDAQ:PANW) – HSBC is considering exiting as many as 1 in 5 countries where it operates to focus on Asian expansion, following pressure from Chinese shareholder Ping An Insurance. The review will affect 12 countries, according to Reuters.

3M  (NASDAQ:PANW) – The Dutch government has officially held 3M liable for damage caused by PFAS chemicals. Investors were reminded of concerns about liabilities related to these products. PFAS are known as “forever chemicals” and have associated health risks. The stock closed at its lowest price since January 2013 on Wednesday.

General Motors  (NASDAQ:PANW) – Shanghai urged General Motors to increase its investment and research and development in the city, with a view to bringing advanced products and technologies to the China International Import Expo. GM faces slumping sales in China due to the delay in introducing new electric vehicle models. 

Stellantis  (NASDAQ:PANW) – Stellantis invested in startup Lyten to accelerate the development of electric vehicle battery technology. Lyten’s graphene technology has applications for lithium-sulfur batteries, which offer higher energy density and a smaller carbon footprint. The size of the investment was not disclosed.

Airbus  (NASDAQ:PANW) – Airbus has ruled out launching a lengthened version of the A220 jet for the time being, putting an end to speculation about a launch at the upcoming Paris Airshow. The current priority is the A220-100 and the A220-300. A larger version may emerge in the future, but the emphasis is on resolving industrial delays.

Embraer  (NASDAQ:PANW) – Embraer has expressed support for Pratt & Whitney over jet engine durability issues, but said a separate trade dispute has caused it to put plans for a new turboprop aircraft on hold. The company is looking at solutions for potential sales of commercial jets and said plans for the turboprop are “on hold” due to a lack of attractive offers from engine makers. The turboprop market is dominated by ATR.


Nvidia  (NASDAQ:PANW) –  Shares of Nvidia were up 24.8% in premarket trade. The chipmaker gave a stronger-than-expected revenue outlook for the fiscal second quarter, while also outperforming its fiscal first quarter results. The share has already more than doubled this year.

Best Buy  (NASDAQ:PANW) – Shares in Best Buy rose 4.2% premarket immediately after the release of first-quarter earnings that beat Wall Street’s earnings estimates. The company reported EPS of $1.15 on revenue of $9.47 billion. Analysts surveyed by Refinitiv had expected EPS of $1.11 on revenue of $9.52 billion. Best Buy affirmed the earlier outlook and expects annual revenue of between $43.8 billion and $45.2 billion, down from the most recent fiscal year and a comparable drop in sales of between 3% and 6%. Best Buy’s first-quarter net income fell to $244 million from $341 million a year earlier.

Snowflake  (NASDAQ:PANW) –  Snowflake was down 13.6% premarket. The cloud computing company gave a weaker-than-expected second-quarter product revenue outlook, according to StreetAccount. Snowflake beat analyst expectations for earnings and revenue in the first quarter, according to Refinitiv.

American Eagle Outfitters  (NASDAQ:PANW) –  Shares fell 20.55% premarket after American Eagle Outfitters said it expects second-quarter revenue to fall in the single digits, instead of rising 1.6% from according to Refinitiv consensus expectations. The clothing retailer reported a mixed quarter, with earnings per share in line with estimates, while revenue beat expectations.

Guess  (NASDAQ:PANW) –  Stocks are flat premarket after the apparel company raised its dividend and boosted its full-year earnings and revenue outlook.

elf Beauty  (NASDAQ:PANW) – Shares of elf Beauty are flat in premarket trading. The cosmetics company reported fiscal fourth-quarter earnings that beat expectations on financial results. The company reported adjusted earnings of 42 cents per share on revenue of $187 million. Analysts polled by Refinitiv had expected earnings of 20 cents a share and revenue of $156 million.

Meituan  (NASDAQ:PANW) – Chinese food delivery and travel services company Meituan beat revenue expectations with sales of 58.6 billion yuan in the latest quarter, versus an average estimate of 57.5 billion yuan. yuan. The post-Covid recovery has boosted business, although competition is increasing with new competitors entering. The company also expanded its operations to Hong Kong.

Splunk  (NASDAQ:PANW) – Shares in software company Splunk rose 7.6% after the company reported a fiscal first-quarter adjusted profit of 18 cents a share, well above the 13-cent loss expected by Wall Street, and revenue that rose 11% compared to a year earlier. Annual recurring revenue was about $3.73 billion, up 16% year-over-year and above the company’s goal of $3.7 billion. The company also issued a strong forecast for the fiscal second quarter, saying it expects annual recurring revenue of about $3.83 billion, with total revenue between $880 million and $895 million, above the Wall Street consensus of $868 million.

UiPath  (NASDAQ:PANW) – The automation software company, fell 7.3% in premarket trading after issuing a fiscal second-quarter revenue forecast of between $279 million and $284 million against expectations from analysts of $284 million.

Nutanix  (NASDAQ:PANW) – The cloud platform company said it expects fiscal fourth-quarter revenue of $470 million to $480 million, above analyst estimates of $452 million. The shares were up 16.1% in premarket trade.

Urban Outfitters  (NASDAQ:PANW) – The retailer reported better-than-expected fiscal first-quarter sales and earnings.

Petco Health  (NASDAQ:PANW) – The pet food vendor offered a soft outlook for the fiscal year.

Analog Devices  (NASDAQ:PANW) The semiconductor company offered disappointing guidance for the third fiscal quarter.

Palo Alto Networks (NASDAQ:PANW) – The company reported fiscal third-quarter adjusted earnings that beat analyst estimates, and the cybersecurity firm raised its outlook on earnings, revenue and sales for the fiscal year.