Early Look

Monday, October 28, 2024

After the S&P snapped its 6-week winning streak last Friday, by ending the week lower by about -0.96%, U.S. futures are already looking sharply higher to start the new week filled with over 35% of S&P companies reporting earnings. The tech heavy Nasdaq finished up a modest 0.16% last week to extend its weekly winning streak to seven while the Dow finished lower by -2.68% last week. Crude oil futures fell over 6% overnight, after widely anticipated Israeli airstrikes against Iran did not hit crucial oil facilities. Oil futures rose last week on worries that the impending Israeli attack, in retaliation for an Iranian missile barrage against Israel on Oct. 1, would target Iran’s oil facilities and potentially spark a wider war in the Middle East. Saturday’s strikes by Israeli jets and missiles instead targeted Iranian air-defense sites and military infrastructure. In Asian markets, The Nikkei Index surged 691 points to 28,605, the Shanghai Index gained 22 points to 3,322, and the Hang Seng Index edged higher 9 points to 20,559. In Europe, the German DAX is up 14 points to 19,478, while the FTSE 100 edges higher a few points to 8,252. No major economic data this morning, but week will be filled with both key jobs data (private, nonfarm, JOLTs) and inflation data (PCE data).

• The Dow Jones Industrial Average fell -259.96 points, or 0.61%, to 42,114.40.
• The Nasdaq Composite gained 103.12 points, or 0.56%, to 18,518.61.
• The Russell 2000 Index declined -10.93 points, or 0.49% to 2,207.99.

• 1:00 PM ET US Treasury to sell $69B in 2-year notes
• 1:00 PM ET US Treasury to sell $70B in 5-year notes

• Earnings After the Close: AESI AGYS AMKR BOOT BRO BRX CALX CCCS CDNS CR CSR CSWV CVI CWH EHC EKSO ESI F FFIV FLS FSBC HLIT KFRC KRC LEG LEU LTC NARI NBTB NEW PCH PLOW QUAD REG RMBS SAFE SBAC SEVN SKY TMDX TREX TRNS TWO UAN UCTT WELL WM ZDGE

• Delta Air Lines Inc. (DAL) sued cybersecurity firm CrowdStrike Holdings (CRWD) over the chaos caused this summer by a “catastrophic” software update that disabled millions of computers worldwide and grounded much of the airline’s passenger fleet
• General Motors (GM), Wells Fargo (WFC) among stocks with high total yields, Barron’s said. Many investors like to buy companies that return gobs of cash to investors as said General Motors Co. (GM) tops the list. In late 2023, the automaker did a $10 billion repurchase as its stock traded in the $30s. It closed Friday at $52.07. At Wells Fargo & Co. (WFC), heavy stock repurchases have paid off. The stock recently rallied roughly 20%, thanks to rising investor optimism that next year, bank regulators will lift a longstanding asset cap that’s depressed earnings.
• Volkswagen’s (VWAGY) management discussed a list of measures for its brand that could achieve savings of 4 billion euros ($4.32 billion), German finance newspaper Handelsblatt reports, citing company sources. The measures include pay cuts of 10%, no wage increases for the next two years and potential closures of some sites in Germany.

• CenterPoint Energy (CNP) Q3 adjusted EPS $0.31 vs. est. $0.32; sees FY25 adjusted EPS $1.74-$1.76 vs consensus $1.73; at the midpoint represents 8% growth from the 2024 midpoint and further maintains non-GAAP EPS growth target through 2030 of the mid-to-high ends of 6%-8% annually.
• NextEra Energy Partners (NEP) downgraded to Neutral from Buy at Guggenheim.
• Sunrun (RUN) is in discussions with data center developers to supply distributed solar power generation for their facilities, Chief Executive Officer Mary Powell said.

• The U.S. commercial real estate industry is pushing for tax relief and incentives championed by former Republican President Donald Trump to continue in the next administration, as the sector struggles with surging delinquencies, record vacancy rates, and elevated costs of financing – Reuters.

• Philips (PHG) falls after the medical device maker cut its 2024 sales guidance to grow by 0.5%-1.5%, down from prior view 3%-5% due to weak demand in China. PHG also reported weaker than expected Q3 sales, down 0.5% yoy vs consensus estimate for 2.1% growth; order intake falls 2% vs 9% growth in Q2.
• UnitedHealth (UNH) to make last push for DOJ Blessing on Amedisys (AMED) deal, Bloomberg reported late Friday. Antitrust division to decide soon whether to challenge deal; enforcers scrutinize concentration in home-health services

• CDW (CDW) downgraded to Neutral from Overweight at JPMorgan
• Ciena (CIEN) downgraded to equal weight from overweight at Morgan Stanley, saying there’s limited potential for meaningful upside to near-term expectations.
• Google (GOOGL) is developing artificial intelligence that takes over a person’s web browser to complete tasks such as gathering research, purchasing a product or booking a flight, The Information reported.