New York stock market futures traded lower on Thursday, with US investors focused on overnight political and macro events in Europe, after the European Commission slashed its $19 trillion European economy’s growth forecast, as the region braces for the departure of its biggest trading partner, Britain, at the end of March.
Today’s movements in US pre-market trading come after the longest winning streak in a month, for US stocks, came to an end on Wednesday – a day after President Donald Trump’s State of the Union address and following a mixed batch of earnings and economic data.
The S&P 500 declined -0.13%, with the Dow Jones Industrial Average and Nasdaq Composite similarly ending the session down -0.04% and -0.3%, respectively.
Video game makers Take-Two Interactive (TTWO: -13.76%) and Electronic Arts (EA: -13.31%) were amongst the market’s biggest laggards; both companies reporting disappointing sales forecasts amid stiff competition from online and mobile games.
Despite this, general fourth-quarter earnings, have largely been surprising to the upside, with profits expected to rise by +15.8%, with 75% of the companies in the S&P 500 reporting so far this season. However, with 2019 forecasts coming in weaker than expected, first-quarter earnings growth is currently estimated at just +0.3%, suggesting the prospect of so-called earnings recession, where profits could shrink for two consecutive quarters.
In today’s data front, investors are likely to monitor Initial Job Claims at 8.30am EST, followed by Consumer Credit numbers at 3pm EST.
Meanwhile, earnings are set to continue being the focus in the stock market, with; Twitter (TWTR), Kellogg (K), Fiat (FCAU) and T-Mobile (TMUS) are set to report before the bell.
While; Expedia (EXPE) and Western Union (WU) will update investors after the bell.
TODAY’S TOP HEADLINES
Brexit & Europe: EU Slashes Growth Forecasts and Warns Over Brexit. (Bloomberg)
The European Commission slashed its growth forecasts for all the euro region’s major economies from Germany to Italy and warned that Brexit and the slowdown in China threaten to make the outlook even worse.
Brexit: British Prime Minister Theresa May heads to Brussels as Brexit breakthrough remains elusive. (CNBC)
US Prime Minister Theresa May is heading to Brussels on Thursday seeking changes to the Brexit deal with the European Union with just 50 days to go until the Brexit departure date.
ECONOMIC CALENDAR:
Today’s Economical Announcements
08:30AM – ★☆☆ – Weekly Jobless Claims (Previous: 253,000)
09:30AM – ★★☆ – FOMC Member Clarida Speaks
03:00PM – ★☆☆ – Consumer Credit (Dec) (Previous: 22.15B)
STOCKS IN THE SPOTLIGHT:
Pre-Market Movers & News Related Stocks
Tapestry (TPR): [EARNINGS] Reported adjusted quarterly profit of $1.07 per share, 4 cents a share short of estimates. Revenue also missed forecasts and Tapestry cut its full-year forecast due to a slowing global economy.
FireEye (FEYE): [EARNINGS] Topped Street forecasts by a penny a share, with adjusted quarterly profit of 6 cents per share. Revenue beat estimates. FireEye also warned that it expected a loss for the current quarter, surprising analysts who had been forecasting a profit.
iRobot (IRBT): [EARNINGS] Reported quarterly earnings of 88 cents per share, well above the consensus estimate of 50 cents a share. Revenue beat forecasts. Issued better-than-expected guidance.
Chipotle Mexican Grill (CMG): [EARNINGS] Reported adjusted quarterly profit of $1.72 per share, beating the consensus estimate of $1.37 a share. Revenue beat forecasts.
SunTrust (STI), BB&T (BBT): [MERGER] BB&T and SunTrust are combining with in a $66 billion merger of equals.
Twitter (TWTR): [EARNINGS] Reported adjusted quarterly profit of 31 cents per share, 6 cents a share above estimates. Revenue above forecasts.
GoPro (GPRO): [EARNINGS] Beat estimates by 4 cents a share, with adjusted quarterly profit of 30 cents per share. Revenue beat estimates, helped by cost-cutting as well as strong demand for its least expensive cameras.
Sonos (SONO): [EARNINGS] Reported quarterly earnings of 55 cents per share, 14 cents a share above consensus estimates. Revenue beat forecasts. Separately, Sonos said CFO Michael Gianetto will retire later this year.
Cardinal Health (CAH): [EARNINGS] Earned an adjusted $1.29 per share for its latest quarter, beating estimates by 20 cents a share. Revenue beat estimates.
Dunkin’ Brands (DNKN): [EARNINGS] Beat estimates by 3 cents a share, with quarterly earnings of 64 cents per share. Revenue missed estimates.
MetLife (MET): [EARNINGS] Earned an adjusted $1.35 per share for the fourth quarter, 7 cents a share above estimates. Revenue missed forecasts.
Guess (GES): [UPGRADE] Jefferies upgraded the apparel maker’s stock to “buy” from “hold,” noting a valuation discount to its peers and to its own history.
Yum Brands (YUM): [EARNINGS] Missed estimates on both the top and bottom lines for its latest quarter, but did register better-than-expected increases in comparable-store sales.
General Motors (GM): [NEWS] GM released details of an incentive plan for the head of its Cruise autonomous driving unit, Dan Ammann, that provides incentives to develop technology and commercialization strategies and could lead the way to an eventual initial public offering for the unit.
CSX (CSX): [DIVIDEND] CSX raised its quarterly dividend to 24 cents per share from 22 cents.
Prudential Financial (PRU): [EARNINGS] Reported lower-than-expected quarterly earnings, driven by losses in its life insurance unit and a drop in asset management income. Prudential earned $2.44 per share for the fourth quarter, compared to a consensus estimate of $2.78 a share.
MOMENTUM STOCKS:
GAINERS: PLT, SWKS, NYT, OSTK, BOOT, SEND, ARRY
LOSERS: VNDA, EA, TTWO, BTU, ATVI, FOSL, APC, PINC
TODAY’S IPOs:
Alector (ALEC) (Low: 18, High: 20) (Shares: 9.3M)
Monocle Acquisition (MNCLU) (Price: 10) (Shares: 15)