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BP Slashes Profit Forecast by $700 Million; Morgan Stanley Predicts S&P 500 10% Drop, and More News

Fernanda T
Latest News
July 09 2024 6:54AM

BP plc (NYSE:BP) – BP expects weak margins in its refining business to impact its second-quarter profits by up to $700 million. The decline in refining margins, due to excess renewable diesel in the US, is the main cause. Shares fell 3.5% in pre-market trading.

Morgan Stanley (NYSE:MS) – Mike Wilson, Chief Investment Officer at Morgan Stanley, predicts a 10% drop in the S&P 500 index before the US presidential elections, citing uncertainties about the Federal Reserve’s monetary policy and the weakening ability of companies to maintain high prices for their products, which could lead to disappointing earnings results.

JPMorgan Chase (NYSE:JPM) – JPMorgan has lowered its forecast for emerging market companies expected to default due to a significant improvement in market stress prices since 2016. Corporate default levels in 2024 are expected to be below the historical average, with China and Latin America still facing challenges.

Bank of America Corp. (NYSE:BAC), PNC Financial (NYSE:PNC), KeyCorp (NYSE:KEY) – UBS analysts highlighted Bank of America as the most interesting bank as the second-quarter earnings season approaches. The bank may benefit from a potential interest rate cut, boosting its net interest income. UBS also adjusted its ratings for PNC Financial, upgrading it to “Buy,” but downgraded KeyCorp due to concerns about its capital position. Bank of America shares rose 0.7% in pre-market trading.

Citigroup (NYSE:C) – Citigroup will end its operations in Haiti due to low demand from institutional clients and reduced international banking activity after more than five decades in the country. This decision is part of a strategic review and will not have a significant economic impact on Citi, which, under CEO Jane Fraser, has focused on more profitable markets and is preparing for an initial public offering of its consumer unit in Mexico in 2025.

KKR & Co (NYSE:KKR), Kokusai Electric (USOTC:KOKSF) – The private equity firm KKR plans to reduce its stake in Kokusai Electric, selling about half of its 43% shares. Kokusai plans to repurchase shares on the market. Since its IPO in 2018, shares of the deposition equipment manufacturer, a former subsidiary of Hitachi, have tripled in value.

Bain Capital (NYSE:BCSF), Envestnet (NYSE:ENV), Bapcor (ASX:BAP) – Bain Capital is close to acquiring Envestnet, a US financial software provider valued at about $3.5 billion. The deal, expected this week, would value Envestnet near its current share price, about $63. The company is facing a leadership transition after the CEO announced his departure. Envestnet shares fell 0.40% in pre-market trading. Elsewhere, Bapcor, an Australian automotive parts retailer, rejected a $1.2 billion buyout offer from Bain Capital, considering it low. The offer of A$5.40 per share does not reflect fair value, according to the company, which also owns Autobarn and the Midas network, among other brands.

Constellation Energy (NASDAQ:CEG), Vistra (NYSE:VST) – The nuclear energy companies Constellation Energy and Vistra lead the S&P 500 after Super Micro and Nvidia, due to explosive growth in demand for clean energy to support data centers and manufacturers amid the expansion of artificial intelligence. Investors are betting on these nuclear companies, driven by US government support for sustainable energy investments. This year, Vistra is up 132% and Constellation Energy 81%. Constellation shares are stable in pre-market trading, while Vistra shares rose 0.8%.

Exxon Mobil (NYSE:XOM) – Exxon Mobil indicated that lower refining margins and reduced natural gas prices will impact its second-quarter earnings, expected to be between $1.50 and $2.40 per share. Excluding the $60 billion acquisition of Pioneer, additional production will not be reflected until the third quarter. Shares are stable in pre-market trading.

Devon Energy (NYSE:DVN) – Devon Energy announced on Monday the acquisition of Grayson Mill Energy’s assets, focused on the Bakken, for $5 billion in cash and shares. The deal will strengthen Devon’s multi-basin business, increasing its position in the Williston Basin with 500 new wells. The transaction is expected to close by the end of the third quarter. Additionally, Devon’s board plans to expand share repurchases by 67% to $5 billion by mid-2026, while expecting the acquisition to contribute to the company’s dividend payments starting in 2025. Shares fell 0.8% in pre-market trading.

Petrobras (NYSE:PBR) – Petrobras announced on Monday its first gasoline price increase in almost a year, also raising the prices of gas used for cooking and heating. The 7% increase in gasoline for distributors takes effect on Tuesday and indicates a shift under new executive leadership.

Alphabet (NASDAQ:GOOGL) – The use of artificial intelligence has driven tech stocks this year, but analysts are cautious about Alphabet’s (Google) stock outlook. Although Wells Fargo raised the price target to $187, maintaining an “Equal Weight” rating, this still implies a 2% drop from Friday’s closing price of $190.60. Alphabet closed down -0.8% on Monday. Shares rose 0.21% in pre-market trading.

Meta Platforms (NASDAQ:META), Vodafone (NASDAQ:VOD) – Meta Platforms’ advertising sales have accelerated over the past four quarters, boosting an optimistic revenue and stock forecast. Wedbush analyst raised the price target for Meta shares to $570 due to strong advertiser spending. Recently, Meta collaborated with Vodafone to optimize the delivery of short videos on 11 European mobile networks without significantly compromising viewing experience. This was in response to the steady growth in data usage driven by videos on platforms like Instagram, TikTok, and YouTube. The optimization managed to reduce Meta’s data traffic on Vodafone’s UK network, freeing up capacity in busy locations. Shares rose 0.55% in pre-market trading.

Logitech International SA (NASDAQ:LOGI) – Logitech rejected founder Daniel Borel’s attempt to replace board chair Wendy Becker with Guy Gecht at the annual shareholders’ meeting. Gecht, who is already on the board, stated he had no interest in being chair and supports Becker. Borel criticized the company’s leadership and Becker’s technological competence, who announced her resignation for 2025. Dissatisfied, Borel took the issue to court. Meanwhile, the company recovered economically after a post-pandemic decline. Shares fell 0.64% in pre-market trading.

Intel (NASDAQ:INTC) – Intel shares closed with a 6.2% gain on Monday after a Melius Research report highlighted that Intel could perform well in the second half of the year. The company has been up in six of the last seven sessions. Shares rose 4.24% in pre-market trading on Tuesday.

Helios Technologies (NYSE:HLIO) – Helios Technologies’ board placed CEO and president Josef Matosevic on paid leave to investigate allegations of a possible violation of the company’s code of conduct and ethics. Helios stated that the alleged conduct does not affect the company’s strategy or financial reports. Shares fell 8.22% in pre-market trading.

Walt Disney (NYSE:DIS) – Disney announced plans to launch a new cruise ship in Tokyo starting in 2028, in partnership with the Oriental Land Company, operator of Tokyo Disneyland. This ship, modeled after the “Wish,” will be the ninth in Disney’s fleet, part of a 10-year, $60 billion expansion in the company’s theme parks and cruise business. Shares rose 0.22% in pre-market trading.

Paramount Global (NASDAQ:PARA) – David Ellison, CEO of Skydance Media, outlined on Monday a vision for Paramount Global as a hybrid technology and media company, amid competition from tech giants in the entertainment sector. He highlighted the importance of the merger with Paramount to better serve a transformed market, emphasizing the use of artificial intelligence and technology to enhance services like Paramount+. Shares fell 0.18% in pre-market trading.

AMC Entertainment Holdings (NYSE:AMC) – AMC shares closed up 8.3% on Monday after a successful weekend since the US Independence Day holiday, marking the busiest Wednesday-to-Sunday period of 2024, with over four million visitors. Additionally, merchandise sales for “Despicable Me 4” were the second highest in AMC’s history, surpassed only by those related to Taylor Swift. The film topped the box office, generating significant revenue and demonstrating the strong appeal of summer releases for the cinema chain. Shares fell 1.83% in pre-market trading.

Cinemark Holdings (NYSE:CNK) – Surprising box office success is driving shares of Cinemark Holdings, which are up more than 55% this year, especially with the releases of major animated sequels. Unlike rival AMC, Cinemark is profitable and well-positioned financially, promising potential returns to shareholders through share buybacks and dividends. Shares are stable in pre-market trading.

Uber Technologies (NYSE:UBER) – Hong Kong plans to regulate ride-hailing apps like Uber, which has operated unregulated in the city for a decade. The proposal includes licensing these platforms and introducing fleets of premium taxis, but maintains the limited number of permits, which could leave many drivers illegal. Shares rose 0.27% in pre-market trading.

Hertz Global (NASDAQ:HTZ), Delta Air Lines (NYSE:DAL) – Gil West, CEO of Hertz and former COO of Delta, has hired former Delta executives for senior positions at Hertz, including Sandeep Dube as chief commercial officer. West focuses on reversing losses by selling Tesla’s electric fleet and raised $1 billion in debt for greater financial flexibility. Hertz shares rose 1.11% in pre-market trading, while Delta shares rose 0.63%.

Tesla (NASDAQ:TSLA) – The price of Tesla shares continued its nine-day climb, closing with a slight gain on Monday despite opening lower. Analysts point to the high volatility of Tesla’s shares, with a wide range of target prices. Unlike tech giants, Tesla faced difficulties in 2024 but has recently recovered, driven by vehicle sales that exceeded expectations. Before the second-quarter earnings report, it is crucial to review Tesla’s strategy in artificial intelligence (AI), especially in autonomous driving, with the company investing in robust infrastructure, including its supercomputer and plans to use 85,000 Nvidia GPUs. In related news, three law firms have requested $7 billion in fees for successfully challenging Elon Musk’s $56 billion compensation package at Tesla, encouraging lawyers to hold corporate boards accountable. The debate over the appropriate amount of these fees took place in a Delaware trial, with intense discussions about the impact of this compensation. Shares are down -0.41% in pre-market trading.

Lucid Group (NASDAQ:LCID) – Lucid Group shares reached their highest level in two months on Monday after the electric vehicle manufacturer reported a significant increase in deliveries in the second quarter. Despite a slight drop in production, this reduction may ease concerns about oversupply due to slowing EV demand. Lucid delivered 2,394 EVs in the quarter, a 70.5% increase from the previous year, while production fell 2.9%. The company will announce full second-quarter results on August 5. Shares rose 0.6% in pre-market trading.

Stellantis (NYSE:STLA) – Stellantis plans to expand its affordable hybrid vehicle lineup to 36 models in Europe by 2026 due to increasing demand. The company, a result of the merger between PSA and Fiat Chrysler, already offers 30 hybrid models across nine of its 14 brands and will add six more in the next two years. The company highlighted a 41% growth in sales of these vehicles in Europe in the first half of this year. In Italy, Stellantis’ car production fell 36% in the first half, impacted by delays in government-promised electric vehicle subsidies. Total production, including light vehicles, was 303,510 units, a 25% reduction from the previous year. If the trend continues, annual production will be far below the 751,000 vehicles of 2023. Shares rose 1.1% in pre-market trading.

Honda Motor (NYSE:HMC) – Honda will end vehicle production at its plant in Ayutthaya province, Thailand, by 2025, consolidating production at its Prachinburi plant. The move reflects the growing challenges for the Japanese brand with aggressive competition from Chinese brands and increased demand for electric vehicles. Shares are stable in pre-market trading.

Boeing (NYSE:BA) – Boeing agreed to plead guilty to a charge of conspiracy to commit criminal fraud related to two fatal 737 MAX crashes, in negotiations with the US Department of Defense on the impact of this on its government contracts. The Pentagon plans to evaluate Boeing’s improvement plans and the agreement with the Department of Justice, which could affect its ability to secure important contracts with the US Department of Defense and NASA. Final agreement details are expected by July 19. Meanwhile, the US Federal Aviation Administration (FAA) has required inspections of 2,600 Boeing 737 planes due to an issue with the oxygen mask restraint belts, which could fail in emergencies. The airworthiness directive demands inspections and necessary corrections within up to 150 days, varying by plane model. Shares are stable in pre-market trading.

Southwest Airlines (NYSE:LUV) – Elliott Investment Management announced on Monday its intention to launch a proxy battle to change the leadership of Southwest Airlines in the US. In a letter to Southwest’s board, Elliott demanded changes in the board and criticized the company’s disappointing financial results. Southwest said it is open to constructive conversations but rejected Elliott’s personal criticisms of its leadership. Shares are stable in pre-market trading.

United Airlines (NASDAQ:UAL) – On Monday, a United Airlines plane lost a landing gear wheel upon takeoff from Los Angeles but landed safely in Denver, its planned destination, without injuries. The wheel was recovered in Los Angeles, and United is investigating the causes of the incident. Shares are stable in pre-market trading.

Nike (NYSE:NKE), Foot Locker (NYSE:FL) – Nike has rehired Tom Peddie, a retired senior executive, to oversee retail partnerships after issues with sneaker sellers and declining sales. Peddie, who worked at Nike for 30 years before retiring in 2020, returns as vice president of market partners. Nike seeks to improve relations with retailers like Foot Locker after prioritizing its own stores, e-commerce, and apps. Nike’s stock fell 33% this year due to continued declining sales. Shares of Nike rose 0.6% in pre-market trading.

Koss Corp. (NASDAQ:KOSS) – Koss Corp. shares fell 21.4% in regular trading on Monday, after a 25.6% increase on Friday, amid rumors that trader Keith Gill might be buying shares. Speculations on social media drove the company into a meme-stock frenzy, resulting in a significant 213.1% rise in 2024. Koss Corp. shares fell 6.6% in pre-market trading.

Vista Outdoor (NYSE:VSTO) – Vista Outdoor rejected a final $3.2 billion buyout offer from MNC Capital, claiming undervaluation, opting for an increased offer for its ammunition unit from Czechoslovak Group (CSG). The deal with CSG was raised to $2.1 billion, expected to close later this month.

Corning (NYSE:GLW) – Corning shares rose 12% on Monday after the company raised its second-quarter forecasts ahead of its earnings report. Sales are expected to be around $3.6 billion, with earnings per share at the high end of the 42-46 cents range, driven by strong demand for optical connectivity products for artificial intelligence. Corning shares rose 1.3% in pre-market trading.

Abbott (NYSE:ABT) – Abbott will face trial over allegations that its formula for premature babies causes necrotizing enterocolitis. The case in St. Louis is the second of hundreds in the US, arguing that the product contributed to the fatal disease. Abbott defends that its formulas are essential in standard medical care for preterm infants.

Raw – Josh Kesselman, founder of cigarette paper manufacturer Raw, plans to take the company public without compromising its culture. With annual revenue of about $120 million and celebrity support from rapper Lil Wayne, he seeks an alternative public offering to maintain family and philanthropic control, inspired by examples like the Green Bay Packers and Spotify.

HilleVax (NASDAQ:HLVX) – HilleVax saw its shares plummet yesterday after halting the development of a norovirus vaccine for infants, whose trial did not meet primary endpoints. The company, which went public in April 2022 at $17 per share, closed at $1.75 on Monday. Shares rose 5.5% in pre-market trading.

Kymera Therapeutics (NASDAQ:KYMR), Sanofi (NASDAQ:SNY) – Kymera Therapeutics announced that Sanofi plans to expand its Phase 2 clinical trials for Hidradenitis Suppurativa and Atopic Dermatitis, aiming to quickly advance to pivotal studies.

Eli Lilly (NYSE:LLY), Morphic Holding (NASDAQ:MORF) – Eli Lilly agreed on Monday to buy Morphic Holding for $3.2 billion in cash, strengthening its portfolio of inflammatory bowel disease (IBD) drugs and expanding its presence in a multi-billion-dollar market. The $57 per share offer represents a 79% premium over Morphic’s last Friday closing price. The acquisition is expected in the third quarter of 2024. Morphic shares closed up 75.1% on Monday, while Eli Lilly rose 0.38%. In pre-market trading on Tuesday, Morphic shares rose 1.45%, while Eli Lilly shares rose 0.7%.

Thermo Fisher Scientific (NYSE:TMO), Olink Holding AB (NASDAQ:OLK) – The UK competition regulator approved on Monday the acquisition of Swedish biotechnology company Olink Holding AB by American medical equipment manufacturer Thermo Fisher Scientific, in a $3.1 billion deal.