In Tuesday’s pre-market trading, U.S. index futures are showing
positive performance. Investors worldwide are carefully analyzing
quarterly earnings reports, as well as significant economic
indicators from Europe. Concurrently, there is growing anticipation
for the release of U.S. inflation data for October. It is estimated
that these figures will indicate a slowing trend in inflation
compared to the previous month’s data.
At 06:03 AM, Dow Jones futures (DOWI:DJI) rose 20 points, or
0.06%. S&P 500 futures climbed 0.08% and Nasdaq-100 futures
increased by 0.18%. The yield on 10-year Treasury bonds was at
4.624%.
In the commodities market, West Texas Intermediate crude oil for
December rose 0.26%, to $78.46 per barrel. Brent crude for January
increased 0.21% to around $82.69 per barrel. Iron ore with a 62%
concentration, traded on the Dalian exchange, rose 0.26%, priced at
$132.19 per ton.
On the economic agenda this Tuesday, investors await the release
of the October business sentiment index at 6 AM, while at 3:30 PM
the API will release the weekly oil inventory data.
Some Fed members speak shortly after the country’s inflation
data is released. At 10 AM, Fed Vice Chairman for Supervision
Michael Barr will speak, followed by Loretta Mester, President of
the Cleveland Fed, at 11 AM, and the President of the Chicago Fed,
Austan Goolsbee, at 12:45 PM.
The major focus is the release of the October CPI at 08:30 AM,
where economists expect a 0.10% increase from the previous month, a
significant slowdown from the 0.40% increase in September. It is
important to note, however, that inflation may get a slight boost
in October, as the U.S. government will change the way it estimates
health insurance costs. In addition to a change in data sources,
the new methodology aims to smooth out some of the volatility and
reduce the time lag in the index.
Tomorrow, the meeting between Joe Biden and Xi Jinping takes
place during the Proclamation of the Republic holiday, drawing
global attention. Asian markets close mixed, awaiting American
inflation and the U.S.-China meeting. In China, problematic
public-private partnership projects are suspended. In Europe, the
focus is on the UK’s unemployment rates and deflation in the
eurozone, while Germany shows an increase in the economic sentiment
index.
U.S. stocks had a weak performance on Monday, with the Dow Jones
slightly rising and the S&P 500 and NASDAQ falling. Moody’s
downgraded the U.S. credit outlook, impacting the market. The
sell-off was mitigated by a report from the New York Fed showing a
decrease in inflation expectations. Sectors varied, with notable
declines in utilities and semiconductors, and a rise in tobacco
stocks.
For corporate earnings front on Tuesday, investors will be
watching reports from Home Depot (NYSE:HD),
Paysafe (NYSE:PSFE), Canadian
Solar (NASDAQ:CSIQ), Aramark (NYSE:ARMK),
Sea Limited (NYSE:SE), before the market opens.
After closing, reports from QuickLogic
(NASDAQ:QUIK), Canoo (NASDAQ:GOEV), AST
SpaceMobile (NASDAQ:ASTS), Pioneer Power
Solutions (NASDAQ:PPSI), among others, are expected.
Wall Street Corporate Highlights for Today
Apple (NASDAQ:AAPL), Alphabet
(NASDAQ:GOOGL) – During an antitrust trial in Washington, it was
revealed that Google passes 36% of its Safari browser ad earnings
to Apple. The deal between the tech giants is kept secret but is
now under scrutiny by the U.S. Department of Justice for possibly
unlawfully maintaining Google’s dominant position.
Foxconn (USOTC:FXCOF) – Foxconn, a supplier to
Apple (NASDAQ:AAPL), surprised with an 11%
increase in third-quarter profit, driven by smartphone demand ahead
of the holiday season. Although it forecasts slight declines in
fourth-quarter and full-year revenues, Foxconn expects a gradual
improvement in operations.
Nvidia (NASDAQ:NVDA) – Nvidia will launch the
H200 AI chip with more high-bandwidth memory in partnership with
Amazon (NASDAQ:AMZN), Google
(NASDAQ:GOOGL), and Oracle (NYSE:ORCL) next year.
The upgrade will enable faster responses in AI services. Major
cloud providers will also offer access to the H200. Nvidia’s shares
are on the longest winning streak since December 27, 2016, when it
rose for 10 consecutive trading days, according to Dow Jones Market
Data.
Amazon (NASDAQ:AMZN), Snap Inc
(NYSE:SNAP) – Amazon will allow U.S. Snapchat users to buy products
directly from the app, in a deal similar to that with Meta
Platforms (NASDAQ:META). Customers will be able to
purchase Amazon ads on Snapchat and see real-time product
information. This expands Amazon’s product offering on social media
apps and benefits Snapchat, which has seen growth in revenue and
users. In other news, Amazon cut about 180 jobs in its gaming
division as part of a restructuring, marking the second round of
layoffs in a week. The company said it is focusing on areas of
higher growth.
Walmart (NYSE:WMT), Target
(NYSE:TGT) – Walmart and Target’s earnings will reveal consumer
spending trends ahead of Black Friday. While food inflation slows,
credit card debt and high interest rates create uncertainties about
year-end purchases. Walmart’s choice not to hire temporary workers
may signal expectations of lower shopper traffic.
Starbucks (NASDAQ:SBUX) – The Workers United
union reported that thousands of Starbucks store employees will
attend the Red Cup Day event due to staffing issues. The union
called for a walkout on November 16, citing challenges faced by
baristas on Red Cup Day. Starbucks responded by criticizing the
union for lack of progress in contractual negotiations.
Stellantis (NYSE:STLA) – Stellantis is offering
voluntary separation packages to about half of its 12,700
administrative employees with over five years of employment, as
part of its efforts to reduce costs and adapt to changes in the
automotive industry, including the transition to electric vehicles.
This is the second round of voluntary buyouts offered by the
company this year.
Tesla (NASDAQ:TSLA) – Tesla plans to increase
imports of components from India, according to Indian Trade
Minister Piyush Goyal. The company aimed to purchase between $1.7
billion and $1.9 billion in Indian components this year, after $1
billion in purchases last year. In other news, Tesla surprised with
a clause in its Cybertruck terms of service, prohibiting owners
from selling it in the first 12 months after delivery. Tesla would
have priority in repurchasing, and sellers need written
approval.
Rivian (NASDAQ:RIVN) – Rivian plans to raise
almost $15 billion in debt to build an electric vehicle factory in
Georgia. The factory will employ over 7,500 people and produce
400,000 vehicles per year.
United Airlines (NASDAQ:UAL) – United Airlines
canceled the resumption of flights from Newark, New Jersey, to Tel
Aviv, Israel, on November 24, stating that a previous announcement
about the return of flights was an error by its public relations
agency.
Boeing (NYSE:BA) – Boeing will expand
production capacity at its Huntsville factory for sensors used in
Patriot missiles, meeting growing global demand for air and missile
defense. The facility, operational in 2027, will increase annual
production by over 30%.
Goldman Sachs (NYSE:GS) – Goldman Sachs
strategists predict that European stocks will rise next year,
driven by increased household purchasing power and cooling
inflation. They see the Stoxx Europe 600 index reaching 480 points
in 12 months, a 7% increase.
Berkshire Hathaway (NYSE:BRK.A) – Berkshire
Hathaway’s stock holdings disclosure may reveal that more General
Motors (NYSE:GM) shares were sold in the third quarter, a
disappointing investment. Berkshire also bought about $1 billion in
financial stocks during the period. So far in 2022, Berkshire has
sold about $23 billion in stocks and bought $49 billion. Its
largest holdings remained unchanged, but GM continues to be a
challenge. The 13-F report should reveal additional details.
Fidelity National Financial (NYSE:FNF) –
Fidelity launched six new ETFs and significantly reduced management
fees for about a third of its existing ETF line. In 2023, 419 ETFs
have been launched so far, approaching the record of 475 in 2021.
Fidelity offers fees between 18 and 28 basis points, below the
average of 63 basis points for actively managed ETFs.
Robinhood Markets (NASDAQ:HOOD) – Alphabet
(NASDAQ:GOOGL), the parent company of Google, dissolved its stake
in Robinhood Markets, after a significant reduction in its stake
months ago. Alphabet had invested in Robinhood when it was a
financial startup. However, uncertain economic conditions have hurt
Robinhood, resulting in performance below Wall Street’s
expectations in the third quarter.
Bain Capital (NYSE:BCSF) – Bain Capital is
exploring a sale or IPO of Varsity Brands, valued at over $6
billion. Varsity Brands generates more than $400 million in
earnings before interest, taxes, depreciation, and amortization
over the last 12 months.
Teck Resources (NYSE:TECK),
Glencore (USOTC:GLNCY) – Glencore acquired 77% of
Teck Resources’ metallurgical coal business, Elk Valley Resources,
for $6.93 billion. The transaction is expected to be completed in
the third quarter of 2024, following discussions about a possible
merger.
Fox Corp (NASDAQ:FOX) – Jason Donner, a former
Fox News reporter, filed a lawsuit claiming he was targeted and
fired for resisting false allegations about the U.S. Capitol riot
on January 6, 2021. He seeks compensation for political
discrimination.
Vodafone Group (NASDAQ:VOD) – Vodafone reported
second-quarter sales growth that exceeded analysts’ estimates,
driven by an unexpected increase in service revenues in Germany
following price hikes. CEO Margherita Della Valle also implemented
job cuts and conducted strategic deals to boost the company.
Tripadvisor (NASDAQ:TRIP), Booking
Holdings (NASDAQ:BKNG) – Analyst Richard Clarke of
Bernstein expressed optimism about the travel sector, upgrading his
ratings for Tripadvisor and Booking Holdings. He upgraded Booking’s
rating from “Underperform” to “Market Perform” and raised the
target price from $2,600 to $2,940, citing a positive outlook
driven by strong travel demand. Clarke also upgraded his rating for
Tripadvisor from “Market Perform” to “Outperform” and raised the
target price from $14.80 to $21.40, based on solid third-quarter
results and the company’s ability to diversify its revenue
sources.
Coty (NYSE:COTY) – Coty expanded its share
repurchase program by $600 million, totaling $1 billion. This
supports the reduction of diluted shares to 800 million by 2026.
The company anticipates strong free cash flow generation and
stability in deleveraging.
WeWork (USOTC:WEWKQ) – WeWork, after filing for
bankruptcy protection, announced that Ernst & Young will no
longer continue as its accounting firm and will no longer audit the
company. There were no disputes between the parties, and the New
York Stock Exchange initiated the process of delisting WeWork,
whose shares are now traded over-the-counter under the symbol
“WEWKQ” since November 8.
AstraZeneca (NASDAQ:AZN) – AstraZeneca entered
the competition for a weight loss pill. Despite being late to the
game, CEO Pascal Soriot sees an opportunity in serving overweight
adults seeking moderate weight loss.
Johnson Controls International (NYSE:JCI) –
Johnson Controls announced that the delay in releasing its
fourth-quarter results is due to a cyberattack that impacted its
financial data systems. The company plans to release the results by
December 14, with further details to be provided later.
Fisker (NYSE:FSR) – The electric vehicle
startup Fisker reported a loss in the third quarter, delivering
about 1,100 electric Ocean SUVs. Deliveries accelerated in October,
however, shares are down more than 13% in Tuesday’s pre-market
trading. The company produced 4,725 Oceans and expects to deliver
300 per day by the end of 2023. The net loss was $91 million, and
revenue was $71.8 million. The company has $625 million in cash and
did not update its full-year production outlook.
Home Depot (NYSE:HD) – Home Depot exceeded Wall
Street’s expectations with a 3% decrease in quarterly sales,
focusing on smaller home repairs. Lowering its annual forecasts,
Home Depot anticipates a 3-4% decline in sales and a 9-11% drop in
earnings per share. The company faces challenges with high mortgage
rates and inflation, leading to a trend of more modest projects. In
the third quarter, the company reported earnings of $3.81 per share
on revenue of $37.71 billion, while analysts had estimated earnings
of $3.76 per share on revenue of $37.6 billion.
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