U.S. stock index futures indicated a tepid start to the week as comments from Federal Reserve Chair Jerome Powell suggested that rate cuts are unlikely in the near term. This sentiment overshadowed the anticipation of upcoming corporate earnings reports, setting a cautious tone for Monday's trading session.
Shares of McDonald's (MCD, Financial) dipped in pre-market trading as the company reported a quarterly revenue miss and weaker-than-expected comparable sales figures. Despite a global sales increase of 3.4%, this fell short of the 4.8% consensus. U.S. sales growth also underperformed, coming in at 4.3% against a 4.5% estimate. The international segment showed particular softness, with the operated markets and developmental licensed markets segments growing by 4.4% and 0.7%, respectively, both missing their growth targets.
Nvidia (NVDA, Financial) shares saw an uptick as Goldman Sachs reaffirmed its Conviction Buy rating and raised its price target for the stock. Analyst Toshiya Hari cited strong artificial intelligence-linked server demand and an improving GPU supply as reasons for the upgrade. Nvidia's shares have been performing well, with a 37% increase year-to-date, and the revised price target of $800 suggests confidence in the company's growth trajectory, especially with new product cycles on the horizon.
Renault (RNSDF, RNLSY) shares experienced volatility but remained positive after Stellantis (STLA, Financial) denied rumors of a potential merger. Stellantis' chairman emphasized the company's focus on its long-term business plan, quelling speculation about a merger with Renault, which had been fueled by reports of France seeking to strengthen its automotive industry against German and Chinese competition.
Bank of New York Mellon (BK, Financial) announced a collaboration with Microsoft (MSFT, Financial) to utilize Azure cloud services for advanced data management for its clients. This alliance aims to enhance risk management and operational efficiency through the use of artificial intelligence and other technologies. Both BK and MSFT stocks saw slight declines in pre-market trading following the news.
Several stocks showed significant movement, with Chenghe Acquisition (CHEA, Financial) and 4D Molecular Therapeutics (FDMT, Financial) among the top gainers. On the other hand, Bit Brother Limited (BETS, Financial) and Intelligent Bio Solutions (INBS, Financial) were among the biggest losers in early trading.
Apple (AAPL, Financial) launched its Vision Pro, which has seen surprising early appeal despite its high price point. Wedbush Securities noted the strong interest and the potential for significant sales, which could bode well for Apple's performance in the market.
Spirit AeroSystems (SPR, Financial) identified a manufacturing issue with some 737 Max fuselages, which may cause delays in Boeing's (BA, Financial) near-term deliveries. Both companies' stocks were negatively impacted by the news, with Boeing's shares falling before the market opened.
Polestar Automotive Holding UK PLC (PSNY, Financial) shares declined following a report that Hertz Global Holdings (HTZ, Financial) is pausing its plans to purchase a large number of electric vehicles from the automaker. The decision was influenced by a drop in resale values of EVs and high repair costs, which has led Hertz to reconsider its EV strategy with both Polestar and Tesla (TSLA, Financial).
ON Semiconductor (ON, Financial) reported earnings that beat expectations, with a positive outlook for the upcoming quarter. The company's performance suggests resilience in the semiconductor industry despite broader market challenges.
Caterpillar (CAT, Financial) saw its stock jump after reporting a profit that surpassed Wall Street estimates, with sales matching expectations. The company's energy and transportation segment showed sales growth, and North America was the only region with increased sales, contributing to the positive market reaction.
Catalent (CTLT, Financial) agreed to a buyout by Novo Holdings, with the deal valuing Catalent at $16.5 billion. The acquisition price represents a premium over Catalent's recent stock price, and the company's shares rose in pre-market trading following the announcement.
Air Products and Chemicals (APD, Financial) released its quarterly earnings, missing estimates on both earnings per share and revenue. The company also provided updated guidance for the fiscal year 2024, which was below consensus expectations.
Estee Lauder (EL, Financial) announced a restructuring plan that includes a reduction in its workforce, aiming to boost profits. Despite providing lower guidance for the upcoming quarter, the company's shares surged as investors reacted positively to the cost-cutting measures.
The Schwab Trading Activity Index showed that investors were net buyers of equities, with particular interest in the 'Magnificent Seven' companies. The index remained in the "moderately low" range, reflecting cautious market participation.
Among the biggest stock movers, 4D Molecular Therapeutics (FDMT, Financial) gained on positive clinical trial data, while Cytokinetics (CYTK) shares dropped following the resignation of a key executive.
