US stock futures declined on Friday, with shares across most of Asia, amid renewed concerns relating to the impact of the coronavirus after cases increased outside of mainland China.
Investors may be underestimating the impact of the outbreak on US companies’ earnings as economic activity slows in China and tourism takes a hit, Goldman Sachs Group warned.
Recent updates saw South Korea report 100 new cases of the virus, despite efforts by the Chinese government to control the outbreak. Stocks in South Korea fell -1.50% on Friday.
These developments come after Thursday’s session, where volatile trading saw the S&P 500 end -0.41% lower, as investors weighed concerns over the impact from the coronavirus on corporate profits.
Ahead, today’s economic calendar includes; the PMI Composite Flash for February at 9:45am, followed by Existing Home Sales at 10am EST.
Earnings reports are expected today from; Deere (DE) and Cinemark Holdings (CNK).
TODAY'S TOP HEADLINES
Coronavirus: Virus Epidemic Enters New Phase as Cases Outside China Multiply. (Bloomberg)
South Korea’s cases have soared past 200. Those for Singapore and Japan have topped 85. And then there are the 600-plus from a quarantined cruise ship in Japan.
Today's Economical Announcements.
09:15AM - ★★☆ - Manufacturing PMI (Feb) (Previous: 51.9)
09:15AM - ★★☆ - Services PMI (Feb) (Previous: 53.4)
10:00AM - ★★★ - Existing Home Sales (Jan) (Previous: 5.54M)
STOCKS IN THE SPOTLIGHT
Pre-Market Movers & News Related Stocks.
First Solar (FSLR): [EARNINGS] Earned an adjusted $2.02 per share for the fourth quarter, short of the $2.72 per share profit that Wall Street analysts had anticipated. The solar power company’s revenue also came in below estimates and First Solar gave weaker-than-expected revenue guidance.
Dropbox (DBX): [EARNINGS] Reported quarterly earnings of 16 cents per share, beating consensus by 2 cents a share. The online file storage company beat revenue estimates as well. Dropbox also raised its profit margin outlook and announced a $600 million share buyback program.
Sprouts Farmers Market (SFM): [EARNINGS] Earned 27 cents per share for the fourth quarter, nearly doubling the 14 cents a share consensus estimates. The organic grocery chain’s revenue was slightly above forecasts, and the company gave a better-than-expected full-year earnings outlook.
Texas Roadhouse (TXRH): [EARNINGS] Beat estimates by 9 cents a share, with quarterly earnings of 61 cents per share. The restaurant chain’s revenue beat forecasts as well with same-restaurant sales up 4.4%. Texas Roadhouse also announced a 20% dividend increase.
Deere (DE): [EARNINGS] Reported quarterly earnings of $1.63 per share, beating the consensus estimate of $1.25 a share. Revenue also exceeded forecasts. Deere said it sees signs of stabilization in the U.S. farm sector, and that the relaxation of trade tensions is improving farmer confidence.
Chewy (CHWY): [UPGRADE] Upgraded to “outperform” from “sector perform” at RBC Capital, on what the firm calls a “highly favorable” risk-reward outlook. RBC said Chewy has strong sustainable fundamentals, including upbeat revenue growth and expanding profit margins.
Pilgrim’s Pride (PPC): [EARNINGS] Fell 10 cents a share short of estimates, with quarterly profit of 14 cents a share. The poultry producer’s revenue came in above Wall Street forecasts. Pilgrim’s Pride said it saw difficult market conditions in some key markets, most notably Mexico.
HP Inc. (HPQ): [NEWS] Adopted a so-called “poison pill” to help fend off Xerox’s (XRX) attempt to buy the computer and printer maker. The poison pill gives shareholders the right to buy more shares at a discount if any one entity acquires 20% of outstanding shares, diluting the group’s stake.
Fitbit (FIT): [EARNINGS] Posted an unexpected loss of an adjusted 12 cents per share, compared to predictions of a 3 cents per share profit. The maker of wearable fitness devices also saw its revenue come in below forecasts, as it sold more devices but at lower prices.
Coca-Cola (KO): [GUIDANCE] Said the coronavirus outbreak would cut its current-quarter earnings by a penny to 2 cents per share, but adds that it still expects to achieve its prior full-year earnings targets.
T-Mobile US (TMUS), Sprint (S): [NEWS] Announced amended terms of their merger which will reduce the stake of Sprint shareholder SoftBank, while T-Mobile parent Deutsche Telekom will have a slightly higher stake.
Wells Fargo (WFC): [NEWS] Is close to settlements with the Securities and Exchange Commission and the Department of Justice over probes into its sales practices, according to The New York Times.
GAINERS: NET, GRUB, ENPH
DECLINERS: TVTY, MD, AAN, VIAC, HCC, JELD
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