U.S. stock index futures fell on Thursday as rising oil prices exacerbated inflation worries, while high-growth stock Tesla fell 1.3% on worries over funding for Elon Musk's proposed buyout of Twitter.
Fears of aggressive interest rate hikes by the Federal Reserve have returned to the forefront after a report on Wednesday showed strong U.S. labor demand.
Rate-sensitive growth stocks fell as the yields on the 10-year Treasury note rose for the second day. Twitter Inc, Nvidia Corp and Microsoft Corp were down between 0.5% to 2% in premarket trading.
Market Snapshot
At 7:50 a.m. ET, Dow e-minis were down 139 points, or 0.46%, S&P 500 e-minis were down 18.50 points, or 0.49%, and Nasdaq 100 e-minis were down 45.75 points, or 0.39%.
Pre-Market Movers
Conagra (CAG) – The food producer’s stock added 2% in the premarket after it reported better-than-expected quarterly profit and sales. Conagra also reaffirmed its full-year guidance.
Peloton (PTON) – Peloton rose 3.4% in premarket trading after announcing it would cut another 500 jobs, or about 12% of its remaining workforce following several previous rounds of job cuts. CEO Barry McCarthy told the Wall Street Journal he’s giving the fitness equipment maker another six months or so to turn itself around and if it can’t, Peloton is likely not viable as a standalone company.
McCormick (MKC) – The spice maker reported adjusted quarterly earnings of 69 cents per share, 7 cents below estimates, with revenue essentially in line with forecasts. McCormick said it is now recovering costs through pricing actions after a period which saw its expenses outpace product price increases. McCormick fell 1.1% in the premarket.
Compass (COMP) – Compass shares surged 11.8% in premarket trading, following an Insider report saying Vista Equity Partners is exploring a deal to take the real estate firm private.
Eli Lilly (LLY) – Lilly shares fell 1.5% in the premarket after its diabetes drug tirzepatide received a “Fast Track” designation from the FDA for possible use to treat adults with obesity or overweight with weight-related comorbidities.
Twitter (TWTR) – Twitter remains on watch today amid multiple reports on the effort by Elon Musk and the social media company to finalize an agreement on his $44 billion takeover deal. The Wall Street Journal reported the two sides held unsuccessful talks about a possible price cut for the deal, and Reuters reports that private equity firms Apollo Global and Sixth Street Partners are no longer in talks with Musk to provide financing. Twitter fell 2.1% in premarket action.
Take-Two Interactive (TTWO) – Take-Two Interactive was upgraded to “buy” from “neutral” at Goldman Sachs, which cited improving videogame industry fundamentals. Goldman increased its price target for the videogame producer’s stock to $165 per share from the prior $131. Take-Two gained 2.7% in premarket trading.
Splunk (SPLK) – Splunk was downgraded to “neutral” from “buy” at UBS, which said the data platform provider faces a number of additional headwinds aside from the overall macroeconomic outlook. Splunk slid 3.1% in the premarket.
Shell (SHEL) – Shell slumped 5.4% in premarket trading after saying third quarter earnings will take a hit from significantly lower profits from trading gas. The energy producer also cites higher costs for delivering fuel.
Pinterest (PINS) – Pinterest rallied 4.8% in the premarket after the image-sharing site’s stock was upgraded to “buy” from “neutral” at Goldman Sachs. Goldman expressed confidence in Pinterest’s ability to further monetize its operations and capture more ad dollars.
Market News
Musk Is Said to Have Discussed Lowering Offer Price With Twitter
Elon Musk’s proposal to revive his $44 billion offer for Twitter Inc. followed earlier discussions about cutting the price that failed to yield an agreement, according to people familiar with the matter.
Musk’s representatives and Twitter held talks in the past few weeks about a buyout for less than the $54.20 a share, which didn’t go anywhere, said the people, who asked not to be identified because the talks were private.
The Wall Street Journal and the New York Times earlier reported the discussions, with the Times saying Musk had sought a 30% reduction in the price.
Apollo, Sixth Street No Longer in Talks to Finance Twitter Deal
Apollo Global Management Inc and Sixth Street Partners, which had been looking to provide financing for Elon Musk's proposed $44 billion buyout of Twitter Inc, are no longer in talks with the billionaire entrepreneur, said two sources familiar with the matter.
Apollo had been in talks to provide preferred equity financing for the deal, alongside Sixth Street, sources previously told Reuters. Apollo, Sixth Street and other investors were looking to commit more than $1 billion in financing for the deal at the time.