S&P 500 futures are down 5 points, Nasdaq 100 futures are down 55 points, and Dow Jones Industrial Average futures are down 12 points. These drops come after a week of ups and downs, with the S&P 500 and Dow ending just shy of record highs. This early dip is partly due to investors taking profits.
Major stocks, especially large cap ones, are seeing some softness before the market opens. Tesla (TSLA, Financial) is particularly lower after revealing plans for a new affordable Robotaxi, the "CyberCab," priced under $30,000, with production starting before 2027.
In the banking sector, JPMorgan Chase (JPM, Financial) and Wells Fargo (WFC, Financial) are both up after surpassing earnings expectations.
Yields on U.S. Treasury bonds are mostly unchanged ahead of the September Producer Price Index report. The 10-year yield remains at 4.10%, and the 2-year yield has dipped slightly to 3.98%.
Later today, the preliminary October University of Michigan Consumer Sentiment survey will be released.
Today's News
Tesla (TSLA, Financial) shares fell by 6% in premarket trading after the "We, Robot" event failed to meet investor expectations. The unveiling of the Cybercab, Robovan, and Optimus humanoid robot did not provide detailed plans or immediate market opportunities, leaving analysts and investors underwhelmed. CEO Elon Musk's vision for autonomous driving in 2025 was not enough to boost the stock, as the event was criticized for lacking substantive updates.
In the banking sector, BlackRock (BLK, Financial) saw a 2.1% rise in pre-market trading due to an impressive $221 billion in quarterly inflows. Meanwhile, JPMorgan (JPM, Financial) and Wells Fargo (WFC, Financial) also reported quarterly earnings. Despite a year-over-year decrease in net income, JPMorgan's stock gained 1.5% and Wells Fargo's climbed 3.3% in premarket trading, buoyed by stronger-than-expected earnings results. These reports come as the market anticipates further insights from the earnings season.
Retail sales in September experienced a 0.3% month-over-month decline, marking the first drop since January. However, year-over-year sales were up by 0.6%, indicating continued consumer spending despite economic uncertainties. NRF President Matthew Shay noted that while consumers pulled back slightly, spending on household priorities remained strong, particularly in clothing and accessories, which saw a 1.06% increase.
JPMorgan (JPM, Financial) raised its net interest income guidance for 2024, boosting investor confidence and resulting in a 1.6% stock gain in premarket trading. The bank's Q3 earnings exceeded analyst expectations, with net interest income surpassing estimates, despite higher-than-expected provisions for credit losses. This positive outlook contributed to the stock's upward momentum.
Wells Fargo (WFC, Financial) reported Q3 earnings that topped Wall Street expectations, leading to a 3.0% increase in premarket trading. The bank's fee-based revenue showed strength, offsetting challenges in net interest income. Although total revenue slightly missed estimates, the company's EPS exceeded the consensus, driven by gains in wealth management revenue.
Aehr Test Systems (AEHR, Financial) saw a 15% surge in its stock after reporting strong first-quarter results. Despite a year-over-year revenue decline, the company's performance exceeded expectations, with significant contributions from its silicon carbide wafer level burn-in test systems. CEO Gayn Erickson highlighted the growing demand in the electric vehicle market as a key driver for future revenue growth.
HP Enterprise (HPE, Financial) introduced its new fanless direct liquid cooling system and AMD-powered server at its first AI day. While the announcements aimed to position HPE as a leader in AI infrastructure, the market reaction was muted, with shares falling slightly in premarket trading. Analysts expressed cautious optimism about the potential cost savings and efficiency improvements offered by the technology.
Affirm Holdings (AFRM, Financial) received an upgrade from Wells Fargo, citing its potential for increased e-commerce market share through partnerships like Apple Pay. The stock has seen significant growth over the past year, and analysts predict further expansion due to easing interest rates and improved engagement with merchants. Despite recent declines, Affirm's long-term prospects remain promising.
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