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Wednesday’s Wall Street Highlights: Ambarella, Alphabet, Toyota, HP Inc, Vinfast, and more

Fernanda T
Latest News
August 30 2023 03:16AM

US index futures are down in the premarket on Wednesday, in a day full of economic indicators, when some data may give signals about the Federal Reserve’s monetary policy.

By 6:51 AM, Dow Jones (DOWI:DJI) futures were up 15 points, or 0.04%. S&P 500 futures were down 0.07% and Nasdaq-100 futures were down 0.16%. The 10-year Treasury yield was at 4.153%.

On Wednesday’s US economic agenda, investors await, at 7:00 AM, last week’s MBA 30-year mortgage rate, while at 8:15 AM the ADP releases the private employment variation for August, which has a consensus of 195,000 new jobs. As of 8:30 AM, in turn, the market will look with a magnifying glass at the second reading of the American Gross Domestic Product (GDP). At 10:00 AM the Pending Home Sales Change for July will be released, while at 10:30 AM the Department of Energy releases the weekly oil inventory.

In the Eurozone, consumer sentiment dropped 16 points in August, in line with forecasts. Investor confidence, scoring 93.3 points, also failed to meet expectations. In Germany, there was a reduction of 13.25% in imports and 3.2% in exports in July, compared to the previous month.

These numbers intensify the scenario of discouragement in relation to the European economy. High inflation and interest rates continue to affect the economy, complicating the situation for the European Central Bank regarding monetary policy. Later today, the August inflation index for Germany will be announced.

In Asia, markets had a mixed close on the lookout for the Federal Reserve to pause monetary tightening, especially after recent disappointing data on US jobs and consumer confidence. Asian markets are also focused on US Commerce Secretary Gina Raimondo’s visit to China.

Raimondo reported that US companies are increasingly reluctant to invest in China, due to fines and regulatory actions that create obstacles to business operations.

In commodities markets, West Texas Intermediate crude for October was up 0.70% to trade at $81.72 a barrel. Brent crude for October was up 0.63% at $86.03 a barrel. Iron ore futures traded in Dalian, China, rose 1.97% to $113.53 a tonne.

At Tuesday’s close, Dow Jones advanced 292.69 points or 0.85% to 34,852.67 points. The S&P 500 jumped 64.32 points or 1.45% to 4,497.63 points. The Nasdaq Composite rose 238.63 points or 1.74% to 13,943.76 points. Economic data released yesterday indicated a deterioration in the US job market, as evidenced by the JOLTS report on new job openings. The projection was 9.5 million vacancies available, but only 8.8 million were reported. Furthermore, the June figures have been revised downwards.

The Consumer Confidence Index, as measured by the Conference Board, also contributed to a more negative view of the economy, coming in at just 106.1 points compared to the expected 116 points. This was also a decline from the previous value, which was adjusted downwards to 144 points. As a result, there was a significant increase in US Treasury yields.

The focus now turns to the PCE inflation index on Thursday and the employment (Payroll) data on Friday.

On the corporate earnings front for Wednesday, traders are watching reports from Patterson Companies (NASDAQ:PDCO), Brown-Forman (NYSE:BF.B), Vera Bradley (NASDAQ:VRA), BioLineRx (NASDAQ:BLRX), among others. After close, reports from Crowdstrike (NASDAQ:CRWD), Salesforce (NYSE:CRM), Okta (NASDAQ:OKTA), Chewy (NYSE:CHWY), Pure Storage (NYSE:PSTG), Five Below (NASDAQ:FIVE), Express (NYSE:EXPR), and more, are expected.

Wall Street Corporate Highlights for Today

Apple  (NASDAQ:AAPL) – Apple has announced an event for September 12 where it is expected to launch new iPhones and smartwatches.

Nvidia (NASDAQ:NVDA) – The valuation of Nvidia has been remarkable this year, more than tripling due to optimism around AI. However, only 15% of mutual funds outperformed their benchmarks due to an underweight in the company, according to Morningstar data. Many investors remain cautious due to the high valuation and uncertainty in the semiconductor sector.

Alphabet  (NASDAQ:GOOGL) – Google announced a series of enterprise-focused AI initiatives at the Google Next conference. New additions include new customers like General Motors  (NYSE:GM) and Estée Lauder  (NYSE:EL), as well as improvements to AI chips and security tools. Offering its AI tools to enterprise customers was priced at $30 per monthly user.

Meta Platforms  (NASDAQ:META) – Meta’s blocking of news on Facebook by Meta in Canada did not significantly affect usage of the platform, according to data. The move comes as Meta faces pressure from the Canadian government over a new law demanding payment to news editors for shared content. At the same time, Meta identified and removed 7,700 accounts linked to the “Spamouflage” influence operation, linked to Chinese authorities. The campaign, active since 2018, aimed to promote China and criticize the West. Meta considers “Spamouflage” to be the biggest cross-platform influencer operation to date.

Box  (NYSE:BOX) – Box reported mixed second-quarter results. The company reported revenue of $261 million, in line with Wall Street forecasts, as per Refinitiv data. While it beat expectations for adjusted earnings per share by 1 cent to 36 cents, Box released disappointing forecasts for the next quarter and full fiscal year, according to FactSet.

Ambarella  (NASDAQ:AMBA) – Semiconductor company Ambarella is down 20.6% in premarket trading on Wednesday, due to a modest outlook for the next quarter, despite exceeding forecasts in the second quarter. The firm anticipates third-quarter revenue of $50 million, down from the $67.6 million forecast by Refinitiv analysts.

Salesforce  (NYSE:CRM) – Salesforce prepares to report its earnings in a context of economic uncertainty and cautious corporate spending. While it has introduced new AI tools and boosted prices, the stock has dropped after past results and the financial outlook remains mixed. For the fiscal second quarter, Salesforce forecast revenue of $8.51 billion to $8.53 billion, up 10% year-over-year, while analyst consensus is at the top end of the range. In other news, Marc Benioff, CEO of Salesforce, warned that the Dreamforce conference in San Francisco may be the last due to local issues of homelessness and drug use. The event is crucial to the city’s economy, attracting around 40,000 people and generating $57 million.

Texas Instruments   (NASDAQ:TXN) – The stock is down 2% premarket to $167.29 after the semiconductor maker was downgraded to Underperform from Market Perform at Bernstein with an unchanged price target of $ $145.

Disney  (NYSE:DIS) – US Secretary of Commerce Gina Raimondo concluded a four-day visit to China with stops at Shanghai Disneyland and a Boeing facility (NYSE:BA). The trip was aimed at strengthening Sino-US trade ties and boosting bilateral tourism.

Walmart  (NYSE:WMT) – Walmart has asked some of its 16,000 US pharmacists to take voluntary pay cuts and reduced hours to cut costs. The move comes amid financial challenges, including a $3.1 billion opioid-related legal settlement and reduced profit margins at its pharmacies.

PepsiCo  (NASDAQ:PEP) – PepsiCo broke ground on construction of a snack food factory in West Java, Indonesia, marking its return to the country after dissolving a joint venture in 2021. The factory is part of a US$200 million investment and will begin production by 2025.

Tesla  (NASDAQ:TSLA) – Elon Musk is positioning Tesla as a serious competitor in AI, launching a $300 million AI computing cluster with 10,000 Nvidia GPUs (NASDAQ:NVDA). The move is aimed at accelerating the development of self-driving cars and bolstering Tesla’s ambitions in AI.

Toyota  (NYSE:TM) – In July, Toyota saw an 8% increase in global sales and a 15% increase in production, marking its recovery from Covid-19 and supply chain challenges. However, a recent production outage could impact the August figures. As reported yesterday, Toyota was forced to halt production at 14 Japanese factories due to a glitch in its parts ordering system. The outage can significantly affect production. The company stated that the issue was not caused by a cyberattack.

Ford Motor  (NYSE:F) – Canadian union Unifor has chosen Ford Motor as a target for contract negotiations with the Detroit Three automakers. Both Unifor and the UAW union in the US have authorized strikes if a new agreement is not reached before the current contract expires.

Nio  (NYSE:NIO) – Chinese electric car maker NIO plans to launch a smartphone in September to improve the driver experience. CEO William Li emphasized that the focus is not on competing with other phone manufacturers, but on improving the integration between vehicle and mobile technology.

Rivian Automotive  (NASDAQ:RIVN) – RJ Scaringe, CEO of Rivian Automotive, received a significant pay raise, with his annual salary rising from $650,000 to $1 million. Additionally, his annual incentive bonus target has increased to 100% of base salary. Rivian also awarded him around $15 million in stock awards.

Vinfast  (NASDAQ:VFS) – Shares in electric car start-up VinFast fell 44% on Tuesday, wiping about $90 billion from its market value and costing majority shareholder Pham Nhat Vuong $67 billion in paper wealth . Despite this, the company maintains a market capitalization of over $100 billion. The stock is up 8.4% in premarket trading on Wednesday.

Lyft  (NASDAQ:LYFT) – Sean Aggarwal, an independent director of Lyft, purchased $1 million worth of company stock, following a similar purchase made by CEO David Risher. Aggarwal was already an early investor in Lyft and sees the current purchase as a significant new investment opportunity.

Boeing  (NYSE:BA) – The US Federal Aviation Administration has issued an updated guidance on cracking issues on Boeing 777 airplanes, citing new unsafe conditions. The move was taken even as Boeing was still reviewing documentation due to immediate public safety concerns.

Nasdaq  (NASDAQ:NDAQ) – Nasdaq has named Sarah Youngwood, a former executive at UBS Group  (NYSE:UBS), as its new chief financial officer, replacing Ann Dennison. Youngwood will take over on Dec. 1 as the company seeks to position itself as a major player in fintech under CEO Adena Friedman.

Berkshire Hathaway  (NYSE:BRK.A) – Berkshire Hathaway has increased its exposure to the Florida reinsurance market, betting on large premiums and minimal losses. With Hurricane Idalia looming, the company faces a risk test, potentially losing up to $15 billion in a major storm.

Citigroup  (NYSE:C) – The SEC has issued a cease and desist order against Citigroup Global Markets for violations of underwriting records. Without admitting guilt, Citigroup agreed to pay a $2.9 million fine. The SEC claimed that the company used unverified calculation methods for a decade.

JPMorgan Chase  (NYSE:JPM) – JPMorgan raised its stake in Brazilian digital bank C6 from 40% to 46%, broadening its engagement amid C6’s rapid growth, which now has 25 million customers. Financial terms were not disclosed.

Goldman Sachs  (NYSE:GS) – Goldman Sachs has agreed to pay a $5.5 million fine to the US Commodity Futures Trading Commission (CFTC) for failing to keep adequate records of employee calls and for violating a prior order. The case resolves allegations related to the bank’s failure to record and store calls.

UBS  (NYSE:UBS) – UBS and financial blog Inside Paradeplatz have settled a lawsuit originally filed by Credit Suisse. The blog agreed to amend or delete certain comments and posts, and the remaining claims were dropped. This is the second Credit Suisse case that UBS has resolved.

Coinbase  (NASDAQ:COIN) – Coinbase is down 1.45% in premarket trading after rising 15% in the previous session following an appeals court ruling that said the Securities and Exchange Commission erred in rejecting Grayscale Investments’ application for a spot Bitcoin ETF.

FedEx  (NYSE:FDX) – FedEx announced that it will increase shipping and customs clearance fees on January 1, 2024 to improve profitability. Rates for US domestic, export and import services will rise by an average of 5.9%.

Kenvue  (NYSE:KVUE) – Kenvue, a spin-out of Johnson & Johnson  (NYSE:JNJ), has become the 67th member of the S&P 500 Dividend Aristocrats Index, which includes companies that have increased their dividends for at least 25 consecutive years. The company, known for brands like Tylenol and Band-Aid, was recently added after being spun off from J&J. Both companies will continue to pay dividends, maintaining their positions in the index.

Catalent  (NYSE:CTLT) – Following agreement with activist investor Elliott Investment Management, pharmaceutical company Catalent has added four new directors and will begin a strategic review. The company, which faces production challenges and acquisition interest, also reported a 17% decline in quarterly revenue. Despite this, it issued a more optimistic outlook for fiscal 2024 above analysts’ expectations.

HP Inc  (NYSE:HPQ) – HP saw its shares decline 8.6% in premarket Wednesday after fiscal third-quarter revenue missed Wall Street expectations. The company had revenue of $13.2 billion, missing the $13.37 billion forecast by analysts polled by Refinitiv. Earnings per share, after items, was 86 cents, in line with projections.

Hewlett Packard Enterprise  (NYSE:HPE) – Shares of Hewlett Packard Enterprise are flat premarket even after slightly beating forecasts for the fiscal third quarter. The company had adjusted earnings of 49 cents per share and revenue of $7 billion, while analysts at Refinitiv had expected 47 cents per share and revenue of $6.99 billion.

Cleveland-Cliffs  (NYSE:CLF) – Steel producer Cleveland-Cliffs has reached an interim three-year agreement with the United Steelworkers union for its Minnesota Northshore mine. The agreement, which covers approximately 430 workers, is awaiting ratification by union members.

US Steel  (NYSE:X) – US Steel is evaluating unsolicited bids for partial or full acquisition and will share due diligence information, according to a letter to shareholders. The move follows a $7.3 billion offer by Cleveland-Cliffs.

PVH Corp  (NYSE:PVH) – Calvin Klein parent company PVH reported solid financial results. The company posted adjusted earnings of $1.98 per share and revenue of $2.21 billion, beating Refinitiv estimates of $1.76 per share and $2.19 billion in revenue. PVH also confirmed its full-year revenue projections and raised its full-year earnings per share forecast.

PDD Holdings  (NASDAQ:PDD) – PDD Holdings, formerly known as Pinduoduo, beat second-quarter expectations with a 66% increase in revenue to $7.17 billion. Its Pinduoduo and Temu platforms saw rapid growth, driven by consumers concerned about prices and promotions.