US stocks had been heading mostly southbound this week, ahead of recent comments from New York Fed Governor, John Williams, which had helped steer US equity futures slightly higher this morning, as investors reacted to the prospect of a deeper rate cut.
Williams told a conference in his home city, on Thursday, that rate setters were better off taking "preventative measures than to wait for disaster to unfold" when considering the level of policy support needed for a slowing economy. The central bank needs to “act quickly”, he added.
Investors had also priced in stronger-than-expected fourth quarter earnings from Wall Street tech-marvel, Microsoft (MSFT), which had seemingly revived tech-stock optimism into the second half of the year.
Today’s early-morning rise looks to extend upon yesterday’s session, where Wall Street ended a two-day losing streak as it initially reacted to John Williams’ comments - his speech had followed a mixed bag of earnings, which put the stock market under pressure for much of the morning session.
The S&P 500 rose +0.37% higher, erasing an earlier decline of as much as -0.4%; as gains in Utilities (+0.87%), Financials (+0.75%), and Consumer Staples (+0.67%) had overshadowed the weight of a heavy loss for shares in Netflix (NFLX: -10.27%).
Ahead, in today’s economic calendar, Friday includes; Michigan Consumer Expectations and Sentiment data for July at 10am EST.
In corporate news; American Express (AXP), Schlumberger (SLB), USA Technologies (USAT) and BlackRock (BLK) are amongst the major companies scheduled to report their earnings today.
TODAY'S TOP HEADLINES
Energy & Oil: Iran rejects Trump’s claim that the US Navy destroyed one of its drones. (CNBC)
Iran rejected claims that one of its drones has been shot down by a US warship in the Strait of Hormuz. On Thursday, President Donald Trump said that USS Boxer, an amphibious assault ship, took down the drone after it came within 1,000 yards of the ship.
ECONOMIC CALENDAR
Today's Economical Announcements.
10:00AM - ★★☆ - Michigan Consumer Expect. (Jul) (Previous: 89.3)
10:00AM - ★★☆ - Michigan Consumer Senti. (Jul) (Previous: 98.2)
STOCKS IN THE SPOTLIGHT
Pre-Market Movers & News Related Stocks.
CrowdStrike (CRWD): [EARNINGS] Posted better-than-expected revenue since going public last month. CrowdStrike reported sales of $96.1 million, topping a Refinitiv estimate of $95.6 million. CEO George Kurtz said the company’s revenue grew by 103% on a year-over-year basis.
Microsoft (MSFT): [EARNINGS] Posted quarterly numbers that topped analysts’ expectations. The company reported earnings per share of $1.37 on revenue of $33.72 billion. Wall Street analysts expected a profit of $1.21 per share on sales of $32.77 billion. CFO Amy Hood said Microsoft’s commercial cloud revenue surged 39% in the quarter.
Zillow (ZG): [RATING] KeyBanc initiated Zillow with an “overweight” rating and a price target of $66 per share, “Zillow’s traffic should allow it to remain the leading marketplace for connecting home buyers/sellers with agents”.
AMC Entertainment (AMC): [RATING] Credit Suisse initiated coverage of the movie theater chain with an “outperform” rating, noting the stock’s 21.7% sell-off this year is “overdone”.
American Express (AXP): [EARNINGS] Posted better-than-expected results for the previous quarter, driven by higher card member spending, and increasing loans and fees. The company also reaffirmed its 2019 outlook.
Boeing (BA): [NEWS] Said it will take a $4.9 billion charged in the second quarter, citing global groundings of its 737 Max planes.
Chewy (CHWY): [EARNINGS] Reported quarterly sales which surged 45% on a year-over-year basis.
Gannett (GCI): [NEWS] The Wall Street Journal reported that Gannett and GateHouse Media (NEWM), another newspaper publishing company, were in “advanced” merger talks.
General Motors (GM): [NEWS] Unveiled the 2020 Corvette Stingray, a car that produces nearly 500 horsepower and has its engine mounted in the middle of the car, like Ferrari (RACE) and other supercar makers.
Amazon (AMZN): [NEWS] President Donald Trump said Thursday the administration would look closely at Amazon’s contract with the Pentagon. “We’re getting tremendous complaints from other companies,” Trump said.
BlackRock (BLK): [EARNINGS] Posted second-quarter results that missed analysts’ expectations. BlackRock posted earnings per share of $6.41 on revenue of $3.524 billion. Analysts polled by Refinitiv expected a profit of $6.50 per share on sales of $3.566 billion. The company’s misses were driven by higher costs and lower revenue from investment advisory and securities lending.
Occidental Petroleum (OXY): [NEWS] A regulatory filing showed activist Carl Icahn has launched a proxy fight against Occidental to win four seats on the company’s board.
MOMENTUM STOCKS
GAINERS: PM, ALLY, KLAC, ADS, IBM, MTCH, FDC, SGEN, HSY
DECLINERS: LL, CRC, URI, GPC, SCPL
TODAY'S IPOs
Afya Limited (AFYA) (Price: 19) (Est. Vol: $261.1M)
ntercorp Financial (IFS) (Low: 44, High: 55) (Est. Vol: $423.0M)
Medallia (MDLA) (Price: 21) (Est. Vol: $325.5M)
