The S&P 500 futures are up 57 points (1.1% above fair value), Nasdaq 100 futures are up 228 points (1.3% above fair value), and Dow Jones Industrial Average futures are up 310 points (0.7% above fair value).
Stocks are set for a higher open, continuing yesterday's recovery after Monday's sharp drop.
The yen weakened against the dollar overnight (USD/JPY +2.1% to 147.29), boosting US equities. This followed Bank of Japan Deputy Governor Uchida's remarks that the BoJ will not raise rates during market instability.
Despite some negative earnings reports, overall sentiment remains positive. Walt Disney (DIS, Financial) and CVS Health (CVS, Financial) reported results that were slightly disappointing.
Treasury yields are higher this morning. The 10-year yield is up four basis points to 3.93%, and the 2-year yield is up two basis points to 4.00%.
Today's economic data includes the weekly MBA Mortgage Applications Index, which jumped 6.9% after last week's 3.9% decline.
In corporate news:
- Walt Disney (DIS, Financial): Beats earnings by $0.19, revenue in-line, Disney+ Core subscribers up 1% to 118.3 million; raises FY24 EPS growth guidance to 30% from 25%
- CVS Health (CVS, Financial): Beats earnings by $0.10, revenue in-line; lowers FY24 EPS below consensus
- Lyft (LYFT): Beats earnings by $0.08, beats on revenue
- Super Micro Computer (SMCI, Financial): Misses earnings by $1.87, revenue in-line; guides Q1 EPS in-line, revenue above consensus; guides FY25 revenue above consensus; announces 10-for-1 stock split
- Rivian Automotive (RIVN): Misses earnings by $0.22, revenue in-line
- Airbnb (ABNB): Misses earnings by $0.05, revenue in-line; guides Q3 revenue in-line; expects slower bookings growth in Q3; slowing demand from U.S. guests; softness in longer lead times affecting near-term guidance
- Amgen (AMGN): Misses earnings by $0.01, revenue in-line; guides FY24 EPS in-line, revenue in-line
- Fortinet (FTNT): Beats earnings by $0.16, beats on revenue; guides Q3 EPS above consensus, revenue in-line; guides FY24 EPS above consensus, revenue above consensus
Reviewing today's economic data:
Today's News
Lumen Technologies (LUMN, Financial) experienced a significant rise in premarket trading, jumping over 45% following mixed Q2 results. Despite lowering its adjusted EBITDA forecast for 2024, Lumen boosted its free cash flow projection to between $1.00B and $1.20B. This follows the company's announcement of $5B in new contracts and potential $7B in additional sales, driven by advancements in artificial intelligence.
Upstart Holdings (UPST, Financial) saw a surge of more than 22% after reporting better-than-expected Q2 results and issuing strong guidance for Q3. CEO Dave Girouard credited the company's improvements to AI advancements, a revived funding supply, and operational efficiency.
Shopify (SHOP, Financial) shares soared after the company topped revenue and profit estimates in its Q2 earnings report. Revenue rose 21.3% year-over-year to $2.05B, while Gross Merchandise Volume increased by 22% to $67.2B. The company also saw a significant rise in Monthly Recurring Revenue, driven by growth in merchants and pricing increases on subscription plans.
Intel (INTC, Financial) reportedly passed on investing in generative AI startup OpenAI back in 2017. The decision was partly due to then-CEO Bob Swan's belief that generative AI models would not come to market in the near term. This move allowed Nvidia (NVDA, Financial) to maintain its stronghold in the AI accelerators market.
The Walt Disney Company (DIS, Financial) traded lower following its FQ3 earnings report. Revenue growth was 3.7% year-over-year, with gains across its Experiences, Sports, and Entertainment segments. Notably, the Entertainment segment's operating income nearly tripled year-over-year due to improved results in direct-to-consumer and content sales/licensing.
Advanced Micro Devices (AMD, Financial) announced the launch prices for its new Ryzen 9000 Series processors. The Ryzen 7 9700X is priced at $359, while the Ryzen 5 9600X will be available for $279. The Ryzen 9 9950X and Ryzen 9 9900X will be priced at $649 and $499, respectively. These processors are reportedly up to $50 cheaper than the launch price of the 7000 series.
CVS Health (CVS, Financial) lost approximately 2% premarket after trimming its full-year earnings outlook, citing pressure on its Health Care Benefits segment. The company reported $91.2B in revenue for Q2, missing consensus by $230M, with the Health Care Benefits segment contributing $32.5B. However, the segment's adjusted operating income decreased by around 39% year-over-year.
Novo Nordisk (NVO, Financial) raised its full-year sales outlook, driven by increased demand for its GLP-1-based diabetes and weight-loss treatments. Sales of its weight loss therapy Wegovy surged 74% year-over-year, while GLP-1-based products for type 2 diabetes grew 32%. Overall, Novo Nordisk's H1 revenue grew 24% year-over-year, with net profit up 16%.
Samsung Electronics' (OTCPK:SSNLF) fifth-generation high bandwidth memory chips have cleared Nvidia's (NVDA, Financial) evaluation for use in its AI processors. Although a supply agreement has not yet been inked, it is expected to start by Q4 2024.
Super Micro Computer's (SMCI, Financial) stock tumbled about 14% premarket after BofA downgraded it to Neutral from Buy. Despite strong revenues, the company is expected to face margin pressures. For Q4, net sales grew to $5.31B, beating estimates, but non-GAAP EPS missed expectations.
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