Early Look

Wednesday, July 10, 2024

U.S. S&P futures are flat to slightly higher, while Nasdaq futures rise behind strength in semiconductors after better revenue figures from Taiwan Semi (TSM) overnight lifts shares, as the S&P 500 looks to extend its five-day consecutive record closing high and Nasdaq composite looks to make it a 7^th straight record close. The S&P 500 and Nasdaq notched record-high closes on Tuesday, fueled by gains in Nvidia after U.S. Federal Reserve Chair Jerome Powell told lawmakers that more “good” economic data would strengthen the case for rate cuts. Powell is set for day 2 of testimony on Capitol Hill, this time speaking to the House Panel on economy and monetary policy. In testimony before Congress, Powell said that while inflation “remains above” the 2% soft-landing target, it has been improving in recent months and “more good data would strengthen” the case for interest-rate cuts. The rate cut hopes grow by the day amid signs of a tighter jobs market, mixed manufacturing market and recent signs of slowing inflation. Inflation data is due this week, including Thursday’s consumer price index (CPI) and the producer price index (PPI) reading on Friday where a “tamer” report could fuel this record market even higher. In Asian markets, The Nikkei Index rose 251 points to 41,831, the Shanghai Index fell -20 points to 2,939, and the Hang Seng Index fell -51 points to 17,471. In Europe, the German DAX is up 140 points to 18,377, while the FTSE 100 rises 47 points to 8,187. China overnight reported mixed June CPI and PPI data.

• The Dow Jones Industrial Average fell -52.82 points, or 0.13%, to 39,291.97.
• The Nasdaq Composite gained 25.55 points, or 0.14%, to 18,429.29.
• The Russell 2000 Index declined -9.20 points, or 0.45% to 2,029.47.

• 10:00 AM ET                Fed’s Powell to testify at House Panel on economy and monetary policy
• 10:00 AM ET                Wholesale Inventory M/M for May
• 10:30 AM ET                Weekly DOE Inventory Data
• 1:00 PM ET US Treasury to sell $39B in 10-year notes
• 2:30 PM ET                   Fed’s Goolsbee, Bowman Give Opening Remarks at Childcare Event

• Earnings After the Close: AZZ BSET ETWO PSMT WDFC

• 16th Annual CEO Investor Summit 2024 – San Francisco
• China Imports/Exports/Trade Balance data for June

• China producer price index (PPI) fell 0.8% in June from a year earlier, less than a 1.4% decline the previous month, and matched a forecast 0.8% fall. The fall in the PPI was the smallest in 17 months.

• Island Capital Group proposed to buy up to 100% interest in MarineMax (HZO) YMRS Business in a letter to MarineMax’s shareholders.
• Kura Sushi (KRUS) Q3 adj EPS $0.00 vs. consensus $0.01; Q3 revs $63.08M vs. est. $63.1M; Q3 comparable restaurant sales increased 0.6% in Q3; lowers FY24 revenue view to $235M-$237M from $243M-$246M prior.

• API reports that crude inventories fell 1.92M barrels last week. Gasoline inventories fell 2.95M barrels.
• Cummins (CMI) raises the quarterly dividend to $1.82 per share from $1.68.
• Honeywell (HON) has struck a deal to acquire the liquefied natural-gas process technology and equipment business from Air Products (APD) for $1.81 billion, according to people familiar with the matter – the WSJ reports.
• Saudi Aramco started the sale of triple-tranche dollar bonds, extending the oil-rich kingdom’s debt spree as it brings in cash to help fund projects. Saudi Arabia raised $1 billion more than previously expected from the sale of a stake in Aramco – Bloomberg.
• Virgin Galactic Holdings, Inc. (SPCE) announced the completion of its new manufacturing facility in Phoenix, Arizona, where final assembly of its next-generation Delta spaceships is scheduled to take place starting in Q1 2025.

• Saratoga Investment Corp (SAR) Q1 adj EPS $1.05 vs. est. $0.93; Q1 net asset value per share $26.85; Q1 AUM was $1.09B; said Q1 ROE was 4.4%.

• Ideaya Biosciences Inc (IDYA) announces proposed public offering of $200M common stock.
• Illumina (ILMN) acquired Fluent BioSciences with cash on hand for an undisclosed amount.
• Novo Nordisk (NVO) has signed a deal with Indonesia’s state-owned pharmaceutical company Bio Farma to produce insulin to combat diabetes in the Southeast Asian country, a senior Bio Farma official said.

• Aehr Test Systems (AEHR) guides Q4 revenue $16.6M vs. consensus $15.45M.
• Alibaba Group (BABA) is reigniting a yearslong effort to expand overseas as it seeks to offset a weakened grip on online retail at home. This time, it’s adding artificial intelligence to the mix – Reuters.
• Smart Global Holdings (SGH) Q3 adj EPS $0.37 vs. est. $0.30; Q3 sales fell -22% y/y to $300.6M in-line with consensus estimates; said Memory solutions net sales -38% y/y, Intelligent Platform Solutions net sales -15% y/y and LED Solutions net sales about flat y/y; guides Q4 EPS $0.40 plus/minus $0.15 vs. est. $0.39 and sees Q4 revenue $325M, plus/minus $25M vs. consensus $322.22M.
• Microsoft (MSFT) has ditched the board observer seat at OpenAI that has drawn regulatory scrutiny, saying it was not necessary after the AI start-up’s governance had improved significantly in the past eight months.