World shares were in a cautious mood on Monday and Wall Street futures lay flat as stalled U.S. debt ceiling negotiations approached crunch time.
U.S. President Joe Biden and House Republican Speaker Kevin McCarthy will meet to discuss the debt ceiling on Monday, less than two weeks before a June 1 deadline after which Treasury expects the federal government will struggle to pay its debts.
Market Snapshot
At 8:20 a.m. ET, Dow e-minis were up 12 points, or 0.04%, S&P 500 e-minis were down 0.25 points, or 0.01%, and Nasdaq 100 e-minis were down 6.5 points, or 0.05%.
Pre-Market Movers
Apple — Shares of the iPhone maker fell about 1% premarket after Loop Capital downgraded Apple’s stock to hold from buy. Loop predicts that the company will fall short of its June quarterly revenue guidance, the firm said in a note Monday.
Meta — The social media company saw its shares dip more than 1% in premarket after news that the firm has been fined a record 1.2 billion euro ($1.3 billion) by European privacy regulators over the transfer of EU user data to the U.S. The Irish Data Protection Commission also told Meta to suspend “any future transfer of personal data” to the U.S. Meta said it would appeal the decision and the fine.
Micron Technology — Shares of the U.S. chipmaker sank more than 4% after China’s Cyberspace Administration barred operators of “critical information infrastructure” in China from purchasing products from Micron. Other chip stocks also fell, with Advanced Micro Devices shedding 1.4% and Nvidia slipping nearly 1%.
PacWest — Shares of the closely watched regional bank rose 3.5% before the bell. The bank sold $2.6 billion worth of construction loans to a Kennedy-Wilson Holdings subsidiary.
Nike, Foot Locker — Shares of Nike and Foot Locker declined 1.5% and 2.4%, respectively, in premarket trading. The move comes after Foot Locker’s lackluster results last week prompted concern over other sports apparel retailers. Foot Locker missed on the top and bottom lines in its first fiscal quarter, and lowered its guidance.
DraftKings — Shares of the sports betting stock rose about 3% before the bell. UBS upgraded shares to a buy from neutral rating, saying that expansion into new markets should fuel growth.
Norfolk Southern, CSX — Shares of the railroads added 1.8% and 1.5%, respectively, in premarket trading. Norfolk Southern was upgraded by Citi to buy from neutral, while Wells Fargo upgraded the stock to overweight from equal weight. CSX was also upgraded by Citi to buy.
Catalent — Shares of the pharmaceutical company declined 2.5% Monday morning. Catalent was downgraded by JPMorgan to neutral from overweight on Friday, with the Wall Street firm citing current productivity issues and macro headwinds among its reasons. Shares surged 15.6% during the previous trading session after the company shared a business update.
Market News
Meta Fined $1.3 Billion Over Data Transfers to U.S.
Facebook owner Meta Platforms was fined $1.3 billion by European Union privacy regulators for sending user information to the U.S., according to people familiar with the matter, a record for the bloc.
The ruling, expected to be announced later Monday, raises pressure on the U.S. government to complete a deal that would allow Meta and thousands of multinational companies to keep sending such information stateside.
Meta’s top privacy regulator in the EU is expected to say that Facebook has for years illegally stored data about European users on its servers in the U.S., where it contends the information could be accessed by American spy agencies, those people and others said.
Exxon Joins Hunt for Lithium in Bet on EV Boom
Exxon Mobil is bracing for a future far less dependent on gasoline by drilling for something other than oil: lithium.
The Texas oil giant recently purchased drilling rights to a sizable chunk of Arkansas land from which it aims to produce the mineral, a key ingredient in batteries for electric cars, cellphones and laptops, according to people familiar with the matter.
Lithium is far removed from the fossil-fuel business, which has powered Exxon’s profits for more than a century, and signals the company’s assessment that demand for internal combustion engines could soon peak, the people said. It would also mark a return for the company to an industry it helped pioneer almost 50 years ago.
Applied Materials to Invest $4 Bln in Silicon Valley Chip Research Center
U.S. semiconductor toolmaker Applied Materials Inc on Monday said it plans to spend up to $4 billion on a research center in the heart of Silicon Valley to speed up advances in semiconductor manufacturing.
The center, which will be based in Sunnyvale, California, will come on line in 2026 and create up to 2,000 engineering jobs, said Applied, which is the world's biggest maker of the tools used in manufacturing chips.
The facility will host about $25 billion of research work over its first decade, pulling together staff from research universities and major chipmakers such as Intel Corp , Taiwan Semiconductor Manufacturing Co and Samsung Electronics Co Ltd , among others.
Ford Signs Battery Material Supply Deals to Charge up EV Output
Ford Motor Co on Monday unveiled three deals for the supply of lithium products, including lithium hydroxide, as the automaker ramps up electric vehicle (EV) production to 2 million units by the end of 2026.
Shares of the company, which is holding a "Capital markets" event later in the day, edged up about 1% before the bell.
The deals come as North American automakers race to secure supplies of battery materials to boost EV output and catch up with market leader Tesla Inc amid surging demand for environment-friendly vehicles.
Kuaishou Technology's Losses Narrowed in Q1, As Revenue Rose Across Business Segments
Kuaishou Technology's losses narrowed in the first quarter, as revenue rose across business segments.
The Chinese internet company on Monday posted net loss of 873 million yuan ($124.6 million), narrowing from loss of CNY6.25 billion a year earlier.
Revenue rose 20% to CNY25.22 billion, mainly driven by a 51% surge in Kuaishou's other-services segment, which primarily consists of e-commerce operations.
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