Early Look

Wednesday, May 21, 2025

After a lackluster, low volume trading day that concluded with modest losses on Tuesday, US futures are moving lower this morning amid a confluence of potential factors. Tensions in the Middle East are ramping up after CNN reported new intelligence obtained by the United States suggests that Israel is preparing to strike Iranian nuclear facilities. Inflation fears are boosting global Treasury yields as UK inflation jumps in April to its highest level since January 2024 as British annual inflation rate hit 3.5%. The headlines spooked Treasury markets as the 10-yr yield in the US rises 5.6 bps to 4.537%. The dollar is falling -0.65% as the euro rises to a two-week high at $1.134. Earnings this from target (TGT) misses on the top/bottom line and cut its outlook for the year, while UnitedHealth (UNH), after rebounding the last few days, is down again on a negative report on nursing homes (see below). In Asian markets, The Nikkei Index fell -230 points to 37,298, the Shanghai Index rose 7 points to 3,387, and the Hang Seng Index gained 146 points to 23,827. In Europe, the German DAX is down -144 points to 23,891, while the FTSE 100 slips -12 points to 8,768. Oil prices are higher following the WSJ story on Iran/Israel.

• The Dow Jones Industrial Average fell -114.83 points, or 0.27%, to 42,677.24
• The Nasdaq Composite dropped -72.75 points, or 0.38%, to 19,142.71
• The Russell 2000 Index gained 1.15 points, or 0.05% to 2,105.58

• 10:30 AM ET                Weekly DOE Inventory Data
• 1:00 PM ET U.S. Treasury to sell $13B in 20-year notes

• Earnings After the Close: BBAR DOMO ENS LX RAMP SNOW URBN ZM

• JP Morgan European Technology, Media & Telecoms Conference, 5/21-5/22, in London
• Keybanc Life Sciences & Bioproduction Tour, 5/18-5/20, in Ireland
• Piper 2025 Financial Services Conference, 5/20-5/21, in New York
• RBC Capital Global Healthcare Conference, 5/20-5/21, in New York
• Sidoti Micro-Cap Virtual Conference, 5/21-5/22 (virtual)
• Truist 2025 Financial Services Conference, 5/20-5/21, in New York

• UK inflation jumps in April to its highest level since January 2024 as British annual inflation rate hit 3.5% in April, as the increase from 2.6% in March was the largest between two months since 2022 when price growth was rocketing above 10% (ests were for reading of 3.3%).
• Japan’s total exports rose 2% in April from a year earlier, matching a median market forecast but slowing from a 4% increase in March, data by the Ministry of Finance showed. Shipments to the United States, Japan’s biggest export destination, fell 1.8% in April from a year earlier to mark the first drop in four months.
• Bloomberg, the markets data and media service, suffered widespread disruption on Wednesday morning that prevented traders from accessing live pricing and delayed an auction of UK government debt.

• Lowe’s (LOW) Q1 EPS $2.92 topped consensus $2.88 while Q1 revenue of $20.93B just missed consensus $20.97B on weaker comparable sales for the quarter decreasing (-1.7%); backs FY25 EPS view $12.15-$12.40 (est. $12.21), backs FY25 revenue view $83.5B-$84.5B (est. $84.31B) and said comparable sales is expected to be flat to up 1% as compared to prior year.
• Target (TGT) Q1 adj EPS $1.30 missed consensus $1.65 on revs $23.85B vs. est. $24.35B; Q1 comparable sales decreased (-3.8%) vs. est. (-1.08%), reflecting a comparable store sales decline of (-5.7%) and comparable digital sales growth of 4.7%; lowers FY adj EPS view to $7-$9, vs. prior $8.80-$9.80 and est. $8.43; sees FY sales declining by low-single digit, saw growth.
• Toll Brothers (TOL) Q2 EPS $3.50 vs est. $2.83 on sales $2.71B vs est. $2.484B; guides Q3 deliveries 2,800-3,000 units and FY deliveries 11,200-11,600 units.
• VF Corp. (VFC) Q4 adj EPS loss (-$0.13) vs. est. loss (-$0.14); Q4 revs $2.1B vs. est. $2.17B; guides Q1 revenue (5%)-(3%) vs. last year and sees Q1 adjusted operating loss ($125M)-($110M); sees FY26 free cash flow up vs. FY25 free cash flow of $313M.

• Modine Manufacturing (MOD) Q4 EPS $0.92 vs est. $0.96, adj EBITDA $104.1Mm vs est. $97.6Mm on revs $647.2Mm vs est. $631.21Mm; guides FY net sales +2-10% vs est. +6.25% and adj EBITDA $420-450Mm vs est. $443.73Mm; says providing broader range for outlook to reflect best estimates for net tariff impacts.

• UnitedHealthcare (UNH) shares falling this morning after a report in The Guardian investigation finds insurer quietly paid facilities that helped it gain Medicare enrollees and reduce hospitalizations. Whistleblowers allege harm to residents. In several cases identified by the Guardian, nursing home residents who needed immediate hospital care under the program failed to receive it, after interventions from UnitedHealth staffers https://tinyurl.com/3zu9enmm

• Baidu Inc. (BIDU) reported its quarterly revenue rose by 3%, indicating some recovery in the Chinese advertising market; Q1 revs stood at 32.45 billion yuan ($4.50 billion), beating analysts’ average estimate of 30.9 billion yuan, according to data compiled by LSEG; reported profit of 21.59 yuan per American Depositary Share, compared with profit of 14.91 yuan per share a year earlier. Baidu’s online marketing business fell 6% to 17.31 billion yuan. Analysts had estimated 17.39 billion yuan.
• Evolv Technologies (EVLV) Q1 EPS loss (-$0.02) on revs $32M vs. est. $28M; said expects positive adj EBITDA in 2025 with adj ebitda margins in low to mid-single digits; sees Fy25 revs $125M-$130M, reflecting growth of 20% to 25% compared to 2024, vs. est. $124.3M.
• Keysight Technologies (KEYS) Q2 adj EPS $1.70 vs est. $1.65 on revs $1.306B vs est. $1.282B; guides Q3 revs $1.305-1.325B vs est. $1.297B and adj EPS $1.63-1.69, vs est. $1.69.
• Palo Alto (PANW) Q3 adj EPS $0.80 vs. est. $0.77; Q3 revs rose 15% y/y to $2.29B vs. est. $2.28B; Q3 Next-Generation Security ARR grew 34% y/y to $5.1B and said remaining performance obligation grew 19% y/y to $13.5B; guides Q4 revs $2.49B-$2.52B or 14%-15% growth vs. est. $2.5B and EPS $0.87-$0.89 vs. est. $0.87; raises FY25 adj EPS view to $3.26-$3.28 from $3.18-$3.24 (est. $3.22) and narrows FY25 revenue view to $9.17B-$9.19B from $9.14B-$9.19B (est. $9.18B).
• Take-Two Interactive Software Inc. (TTWO) announced a proposed underwritten public offering of $1B of shares of its common stock.
• ViaSat Inc. (VSAT) Q4 adj EPS ($0.02) vs est. ($0.44), adj EBITDA $375Mm vs est. $386.91Mm on revs $1.147B vs est. $1.131B; says sees FY revs +low-single-digit vs est. +2.12% and adj EBITDA flattish yr/yr vs est. +1.36%; sees FY CAPEX about $1.3B.
• Wolfspeed (WOLF) shares tumbled after the WSJ reported the company is reportedly preparing to file for Chapter 11 bankruptcy within weeks, as it struggles to manage a $6.5B debt load. The company has been negotiating with creditors but has rejected several out-of-court debt restructuring proposals, opting instead for a prepackaged Chapter 11 plan supported by a majority of its creditors. https://tinyurl.com/248nz7md
• A data center in Texas that startup Crusoe is building for OpenAI has secured $11.6 billion in funding to expand from two to eight buildings, the Wall Street Journal reported on Wednesday. The data center — expected to be the ChatGPT parent’s largest — will use up to 50,000 Nvidia (NVDA) Blackwell chips per building, according to the report. The funding, a mix of debt and equity, will increase the total amount secured for the project to $15 billion, the WSJ report said – WSJ