U.S. stock index futures advanced on Tuesday as some growth and chip stocks gained, while positive earnings across several sectors got the ball rolling ahead of big tech earning later in the week.
Market Snapshot
At 7:50 a.m. ET, Dow e-minis were up 42 points, or 0.11%, S&P 500 e-minis were up 9.25 points, or 0.18%, and Nasdaq 100 e-minis were up 37.75 points, or 0.22%.
Pre-Market Movers
Tesla (TSLA) - Tesla rose 0.3% in premarket trading after falling 3.4% on Monday and finishing lower for a seventh-straight session. Heading into its earnings report after the closing bell Tuesday, Tesla shares have fallen 43% this year. Analysts expect the electric-vehicle maker to report first-quarter earnings of 49 cents a share on revenue of $22.22 billion. A year earlier, Tesla earned 85 cents a share on revenue of $23.33 billion. Wall Street also projects first-quarter operating profit margins of 7% at Tesla, down from 11% a year earlier and 19% two years ago.
Nvidia (NVDA) - Nvidia shares gained another 1.5% in premarket trading Tuesday after rebounding over 4% on Monday. The chipmaker’s stock fell 10% Friday, as part of a widespread rout of big tech shares. Nvidia lost nearly $212 billion in market value in the session, according to Dow Jones Market Data, which left the company under the $2 trillion valuation mark.
Sea (SE) - Sea shares gained another 2% in premarket trading Tuesday after jumping 7.9% on Monday on pair of analyst upgrades. Shares of Sea Ltd. jumped in Monday trading after the Singapore-based internet services company received a pair of upgrades from analysts at Bank of America and Morgan Stanley.
General Motors (GM) - General Motors topped Wall Street’s first-quarter sales and earnings estimates, and the auto maker raised full-year financial guidance while maintaining its commitment to more battery-electric vehicle sales in the future. The stock jumped 4.7% in premarket trading.
United Parcel Service (UPS) - United Parcel Service reported first-quarter adjusted earnings of $1.43 a share, topping analysts’ estimates of $1.28. Revenue of $21.7 billion missed expectations of $21.8 billion. Shipping volume fell 3.2% in the U.S. The shipping giant reaffirmed its 2024 revenue estimate of $92 billion to $94.5 billion. The stock was up 1.4%.
GE Aerospace (GE) - GE Aerospace reported first-quarter earnings of 82 cents a share; analysts were expecting 65 cents. The period included results from GE Vernova, which was split into a separate company on April 2. The company raised its 2024 operating profit outlook to $6.2 billion to $6.6 billion from prior guidance of $6 billion to $6.5 billion. Shares were up 5%.
Spotify (SPOT) - Spotify Technology swung to a profit in the first quarter and shares of the audio streaming giant jumped 8.3%. Monthly active users rose 19% in the first quarter to 615 million, 3 million below expectations.
PepsiCo (PEP) - PepsiCo posted first-quarter adjusted earnings of $1.61 a share, higher than Wall Street estimates of $1.52. Shares of the beverages and snacks maker, however, were down 0.2% in premarket trading.
JetBlue (JBLU) - JetBlue Airways declined 9.6%. The carrier reported a narrower-than-expected first-quarter loss but said revenue in the second quarter would fall between 6.5% and 10.5% year over year, wider than the 3.7% drop estimated by analysts.
Roblox (RBLX) - Shares of gaming platform Roblox up 4.2% at $36.44 premarket. J.P.Morgan upgrades to "overweight" from "neutral" and raises PT to $48 from $41.
Apple (AAPL) - Apple shares dipped 0.2% in premarket trading as sales of iPhones in China dropped by 19% in the first quarter, according to research firm Counterpoint Research. It was the worst performance for the iPhone in China in the January-March period since Covid-19 struck in 2020, Counterpoint said.
Novartis (NVS) - Swiss drugmaker Novartis raised its full-year guidance on wider use of psoriasis and arthritis drug Cosentyx on Tuesday and said it had tapped the former boss of Bristol Myers Squibb (BMS) to become its chairman next year. US listed shares of Novartis gained 5.1% in premarket trading Tuesday.
SAP SE (SAP) - US-listed shares of SAP SE rose 3.8% in premarket trading Tuesday after posting strong cloud demand in the first quarter, as the boom in artificial intelligence fueled the German software company’s growth.
Cadence Design Systems (CDNS) - First-quarter earnings at software maker Cadence Design Systems topped analysts’ estimates but the company’s forecast for the second quarter was well below expectations and the stock was tumbling in premarket trading, down 6.5%. Cadence Design said it expects second-quarter adjusted profit of $1.20 to $1.24 a share, below expectations of $1.43.
Calix (CALX) - Calix was falling 15.3% in premarket trading after the broadband-software company said it anticipates second-quarter revenue of $197 million to $203 million, down from year-earlier revenue of $261 million. Analysts had been forecasting revenue of $232.8 million.
Nucor (NUE) - Nucor posted first-quarter earnings that fell from a year earlier and the steel maker said it expects second-quarter profit to fall on a sequential basis because of decreased earnings from its steel mills segment. The stock fell 6.2%.
ImmunityBio (IBRX) - The U.S. health regulator approved on Monday ImmunityBio's combination therapy to treat a type of bladder cancer, marking an end to the company's efforts to bring its therapy to the market. ImmunityBio shares surged 19.6% in premarket trading Tuesday.
Abeona Therapeutics (ABEO) - Abeona Therapeutics said on Monday the U.S. Food and Drug Administration (FDA) had declined to approve its treatment for a rare skin blistering condition, sending its shares down 49.3% in premarket trading Tuesday.
AGBA Group (AGBA) - AGBA Group shares jumped another 20% in premarket trading. AGBA Group Holding Limited shares soared 100% Monday on continued upward momentum after the company announced it entered into a definitive mergeragreement withTrillerCorp. last week.
Hibbett (HIBB) - British sportswear and sneakers retailer JD Sports Fashion Plc has agreed to buy Hibbett Inc. for about $1.1 billion to speed up its US expansion. Hibbett shares jumped 18.6% in premarket trading Tuesday.
Market News
UBS Cuts View on "Big 6" Tech Stocks as Earnings Growth Slows
Big tech companies are running out of steam as the earnings momentum once enjoyed by the sector faces a cool down, according to UBS Group AG’s chief US equity strategist.
Ahead of this week’s earnings, UBS cut their sector recommendation on the ‘Big 6’ technology stocks — Alphabet Inc., Apple Inc., Amazon.com Inc., Facebook-parent Meta Platforms Inc., Microsoft Corp. and Nvidia Corp. — to neutral from overweight.
“Earnings momentum is turning decidedly negative following a surge in profit growth,” Jonathan Golub at UBS said.
The sector downgrade is “an acknowledgment of the difficult comps and cyclical forces weighing on these stocks,” and not “predicated on extended valuations, or doubts about artificial intelligence,” the strategist wrote in a note dated Monday.
UBS Lifts Chinese Stocks to Overweight in Rare Upgrade Call
UBS Group AG raised its recommendation on a key Chinese stock index to overweight in a rare upgrade call this year, underscoring the tentative optimism that the market is finally on the mend.
“The largest stocks in the China index have been generally fine on earnings and fundamentals,” strategists including Sunil Tirumalai wrote in a Tuesday note. UBS is now even more positive on earnings given early signs of a pickup in consumption, with the possibility of household savings flowing into spending and eventually markets, the note said.
The bullish call for the MSCI China Index arrives at a pivotal time. Shares had been emerging from a multi-year slump, thanks to green shoots in the economy as well as signs of improving corporate performance. However, lingering risks from geopolitical tensions and potential regulatory whiplash have made investors wary of going all-in on the asset class.
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