U.S. stock index futures rose on Wednesday as better-than-feared quarterly reports from technology giants Microsoft and Alphabet calmed investors ahead of a key U.S. interest rate decision later in the day.
Market Snapshot
At 08:00 a.m. ET, Dow e-minis were up 131 points, or 0.41%, S&P 500 e-minis were up 31.5 points, or 0.8%, and Nasdaq 100 e-minis were up 161.25 points, or 1.33%.
Pre-Market Movers
Boeing(BA) – Boeing posted a wider-than-expected quarterly loss with revenue that fell below consensus estimates. However, Boeing reported positive operating cash flow and, unlike in prior quarters, did not see any charges related to the production of its 737 MAX jet. Boeing jumped 4.4% in premarket action.
Hilton Worldwide(HLT) – Hilton rallied 4.8% in the premarket after the hotel operator’s second-quarter results beat top and bottom line estimates. Hilton also raised its full-year forecast, as travel demand continues to rebound.
Spotify(SPOT) – Spotify reported a wider-than-expected quarterly loss, but its revenue exceeded analyst forecasts as it saw a 14% increase in paying subscribers for its premium streaming service. Spotify jumped 6% in premarket trading.
Garmin(GRMN) – The GPS device maker’s stock slumped 9.3% in the premarket after its quarterly earnings beat estimates, although revenue fell short of analyst predictions. Garmin said its results were negatively affected by underperformance in its fitness segment.
Tempur Sealy(TPX) – The mattress retailer’s stock slid 6.9% in the premarket after its quarterly earnings and revenue missed analyst forecasts. The company said macroeconomic factors contributed to a deteriorating operating environment in North America. Tempur Sealy also cut its full-year forecast.
Shopify(SHOP) – The e-commerce platform provider slumped 6.8% in premarket action after posting a wider-than-expected loss and saying losses will increase in the current quarter. Shopify said inflation and rising interest rates will hurt consumer spending.
Microsoft(MSFT) – Microsoft gained 3.5% in the premarket despite missing on both the top and bottom lines for its latest quarter. The company saw its slowest earnings growth in two years amid a slowdown in its cloud business. Microsoft, however, issued an upbeat outlook, saying currency-adjusted sales and operating income will increase by a double-digit percentage this quarter.
Alphabet(GOOGL) – Alphabet also rallied, rising 3.7% in premarket action, even though its quarterly sales and profit missed Wall Street forecasts. The Google parent’s results were impacted in part by a pullback in spending by advertisers, but some investors had apparently braced for even worse results.
Chipotle Mexican Grill(CMG) – Chipotle surged 9% in premarket trading, with the restaurant chain operating reporting better-than-expected earnings for its latest quarter. Chipotle was able to offset an increase in costs with several rounds of price hikes.
PayPal(PYPL) – PayPal added 6.8% in the premarket after the Wall Street Journal reported that activist investor Elliott Management took a stake in the company. The size of the stake and Elliott’s intentions could not be learned.
Teva Pharmaceutical(TEVA) – Teva shares surged 22.9% in premarket trading after it reached a national settlement worth up to $4.25 billion over its alleged role in the opioid crisis.
Enphase Energy(ENPH) – Enphase reported better-than-expected sales and profit for its latest quarter, sparking a 9% premarket rally in its shares. The solar equipment company’s results benefited from a jump in its European business.
Market News
Boeing Results Fall Short of Estimates but Manufacturer Still Expects to Be Cash Flow Positive This Year
Boeingon Wednesday reported revenue and an adjusted loss that fell short of analysts’ estimates but the aircraft manufacturer stuck with its forecast to return to free cash flow in 2022.
The company is fresh from winning high-profile ordersat the Farnborough Air Show like those for 100 737 Max 10s from Delta Air Lines.
Shopify swings to loss on cloud, delivery network investments
Canada's Shopify Inc (SHOP.TO) on Wednesday reported a quarterly loss as the company invests heavily to build its cloud infrastructure and delivery network to counter a slowdown in its ecommerce business.
Shopify was among the big winners during the pandemic when many brick-and-mortar retailers shackled by pandemic-related lockdowns flocked to its infrastructure to set up stores online to sell their products.
Spotify's Quarterly Revenue, User Growth Beats Expectations
Spotify reported second-quarter revenue above analysts' estimates on Wednesday, helped by a 14% jump in paying subscribers as more users listened to its podcasts, and the company forecast an upbeat current quarter.
The Swedish music streaming company posted a 23% increase in revenue to 2.9 billion euros ($2.94 billion), beating analysts' expectations of 2.8 billion euros, according to IBES data from Refinitiv.
Cathie Wood Dumps Coinbase Shares for First Time This Year
Funds controlled by Cathie Wood dumped Coinbase Global Inc.’s stock for the first time this year amid reports the largest US crypto exchange is facing a probe.
Three Ark Investment Management LLC funds sold slightly over 1.41 million shares, which were worth about $75 million as of Tuesday’s close, according to Ark’s daily trading data compiled by Bloomberg. The firm’s flagship Ark Innovation ETF sold 1.13 million shares.
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