Mid-Morning Look: July 26, 2023

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Mid-Morning Look

Wednesday, July 26, 2023






DJ Industrials




S&P 500








Russell 2000






U.S. stocks showing early weakness ahead of the FOMC interest rate decision later this afternoon (2:00 PM ET), as worries grow additional rate hikes could be in the cards. The WSJ’s Nick Timiraos reported last night “economic growth has likely been too firm in recent months for Fed Chair Jerome Powell to signal that Wednesday’s increase in the Fed’s benchmark short-term rate—to a 22-year high—will be the last of the current tightening cycle.” In addition to the policy meeting, shares of MSFT pulled back on higher spending concerns, weighing on the Dow Jones Industrial Average which comes into the day with a 12-day winning streak for the index. However, stocks are already well off their lows, with big cap names rebounding from initial weakness. Recap if top earnings movers below. Meanwhile in the lone piece of US economic data, June New Home Sales data showed a decline from prior month. All eyes on FOMC later today, with the European Central Bank tomorrow (25-bps hike expected) and then the Bank of Japan meeting Friday along with several US inflation reports.


Economic Data

·     Single-family new home sales for June fell -2.5% to 697K unit annual rate, below consensus 725K and down from May 715K rate; new home supply 7.4 months’ worth at current pace vs May 7.2 months; median sale price $415,400, -4.0% from June 2022 ($432,700).







WTI Crude















10-Year Note






·     BA +6%; posted smaller than expected EPS loss as revs rose 18% y/y to $19.75B vs. est. $18.45B and said plans to ramp up production of 737 MAX narrow-body jets to 38 from 31 per month, indicating recovery in supply chain.

·     GOOGL +6%; Q2 EPS of $1.44 topped estimates by $0.10 on better revs $74.6B vs. est. $72.82B as Cloud segment revenue in Q2 grew 28% to $8.03B from $6.28B a year earlier.

·     GPS +8%; Richard Dickson, the President, and COO at toymaker MAT left to take over as GPS’s next chief executive, ending a yearlong search for a new leader.

·     PACW +31%; as announced a merger with BANC & $400M equity raise from Warburg Pincus & Centerbridge; PacWest holders will receive 0.6569 of a share of BANC stock for each share of PACW common stock, which values PACW at $9.60 per share. https://tinyurl.com/5x4up696

·     TENB +12%; reported Q2 results of $195mn and $0.22 compared to Street expectations for $190mn and $0.13 as a key positive metric was calculated current billings (CCB) of 200.2M, up 15% YoY and raised its outlook for FY23.

·     UNP +9%; as 2q adj. operating ratio 63% vs. est. 60.4%, while EPS and revs were down y/y for the quarter and mixed, but announced CEO to step down, lifting shares.

·     WFC +2%; as announced plans to repurchase as much as $30 billion of its shares and boosted its dividend.

·     XPEV +26%; shares jump in EV sector after Volkswagen Brand to jointly develop two electric models for mid-size segment with Xpeng Inc.



·     MSFT -3%; as aggressive spending fears in AI weighed on sentiment after a top and bottom line beat for the quarter.

·     RHI -7%; after top and bottom-line miss for Q2 (EPS $1.00 vs. est. $1.14; Q2 revs $1.639B vs. est. $1.69B).

·     RIO -2%; said profits sank 34% to $3.53 per share in 1H’23 while revs dropped more than 10% to $26.67B; sales from iron ore decreased 11% to $15.6B and aluminum revs sank 18% to $6.26B; and cut its dividend.

·     SLAB -9%; Q2 revs mostly in-line with consensus but guides Q3 PES $0.45-$0.73 on revs $190M-$210M, well below consensus $1.08/$253.3M, citing weak demand and excess inventory among its home-and-life unit’s customers.

·     SNAP -18%; as forecast Q3 revenue between $1.07B-$1.13B vs. est. $1.13B and said expects Q3 daily active users (DAUs) 405M-406M vs. est. 406.2M; Q3 revenue guidance calls for a 2.5% Y/Y decline in revenue.

·     SPWR -14%; lowers FY adj. EBITDA view to $55M-$75M from prior $125M-$155M; Q2 revs $464M missed the $485M estimate; sees Q2 GAAP net loss $30M; Adjusted EBITDA ($3M); Q2 customer growth of 20,400 new customers.

·     TMO -1%; after top and bottom-line miss and cuts FY23 adjusted EPS view to $22.28-$22.72 from $23.70 and lowers FY23 revenue view to $43.4B-$44B from $45.3B, consensus $45.21B.

·     TXN -5%; posted strong 2Q results and guided 3Q lower. 2Q results reflect weakness across all end-market segments except for auto, and likely limited signs of a recovery in China. 3Q revenue is expected to be flat q/q, below consensus.

·     WM -3%; reported 2Q23 adj EBITDA of $1.467B, missing ests around $1.5B amid softer revenue and a 10-bps margin miss (+60 bps y/y); also lowered 2023 adjusted EBITDA guidance by $75M (or ~1%) at the midpoint.


Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.

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