The S&P 500 futures are up 4 points, trading slightly above fair value. The Nasdaq 100 futures are down 6 points, trading slightly below fair value. Dow Jones Industrial Average futures are up 10 points, trading 0.1% above fair value.
Futures for the S&P 500, Dow Jones, and Nasdaq 100 are mostly unchanged, indicating a flat open for the major indices. Retailers' earnings have mostly been positive. Lowe's (LOW) and Macy's (M) are up after reporting their quarterly results, while AutoZone (AZO) shows a premarket loss.
The 10-year note yield is down one basis point to 4.43%, and the 2-year note yield is down one basis point to 4.83%.
There is no significant U.S. economic data today. However, Wednesday will feature the release of the Minutes from the April 30-May 1 FOMC meeting and the Existing Home Sales report for April.
In corporate news:
- Lowe's (LOW) is up 2.1% after beating earnings by $0.11 and meeting revenue expectations. The company reaffirmed its FY25 EPS and revenue guidance.
- Macy's (M) is up 3.5% after beating earnings by $0.11 and reporting in-line revenues. The company raised its FY25 EPS guidance.
- AutoZone (AZO) is down 1.0% after beating earnings by $0.67 but missing on revenue. Q3 comparable sales were up 1.9%.
- Palo Alto Networks (PANW, Financial) is down 6.5% after beating earnings by $0.07 and reporting in-line revenues. The company provided in-line guidance for Q4 EPS and revenues.
- Keysight (KEYS) is down 2.4% after beating earnings by $0.02 and exceeding revenue expectations. The company guided Q3 EPS and revenues below consensus.
- Zoom Video (ZM) is down 2.6% after beating earnings by $0.16 and exceeding revenue expectations. The company provided Q2 EPS and revenue guidance below consensus but raised FY25 EPS and revenue guidance above consensus.
- Nordson (NSDN) is down 8.7% after beating earnings by $0.03 but missing on revenue. The company provided Q3 and FY24 EPS and revenue guidance below consensus.
- Coinbase Global (COIN) is up 3.6% amid rising cryptocurrency prices. Bitcoin is at $71,290.
- Peloton (PTON) is down 4.9% as it plans to launch global refinancing and offer $275 million in convertible senior notes due 2029.
Reviewing overnight developments:
Today's News
Macy’s (M) shares are seeing a 4% increase in Tuesday’s premarket trading after the department store’s Q1 results exceeded analysts’ conservative expectations. The company raised its bottom-line revenue guidance by $100M. Despite the positive results, Macy's is still grappling with pressure on comparable store sales and the impact of discounting on its merchandise margin. The retailer earned a profit of $0.27 per share, down from $0.56 per share in the same quarter last year, but 10 cents better than expectations. Total sales fell 3.3% to $5B, coming in $190M above estimates. Other revenues, including credit card and Media Network revenue, were down by $37M due to higher delinquencies.
Lam Research (LRCX, Financial) announced a $10 billion share repurchase authorization, aligning with its plan to return 75% to 100% of free cash flow to stockholders via dividends and buybacks. This new authorization has no termination date and can be suspended or discontinued at any time. Additionally, the company is executing a 10:1 forward split of its common stock, effective after market close on October 2, 2024. LRCX common stock will begin trading on a post-split basis on October 3, 2024.
Investors are keeping a close watch on Nvidia (NVDA, Financial) as the company is set to release its quarterly results tomorrow. Palo Alto Networks (PANW, Financial) saw a 7.8% drop in premarket trading after announcing its Q3 earnings, which showed a lowered billing outlook for FY2024. Despite exceeding expectations in FQ3, the company expects EPS for Q4 in the range of $1.40 to $1.42, aligning with the estimate of $1.42, and revenue between $2.15B and $2.20B.
Singapore Airlines (SINGY, Financial) reported a tragic incident where a person was killed and several others were injured due to heavy turbulence on a flight from the UK to Singapore. The Boeing 777-300ER had to make an emergency landing in Thailand. The airline is working with local authorities to provide necessary medical assistance and has sent a team to Bangkok for additional support.
ZIM Integrated Shipping Services (ZIM, Financial) declared a $0.23 per share dividend, payable on June 11 to shareholders of record on June 4. The company’s Q1 results showed a net income of $92 million, reflecting a significant improvement in global freight rates. Despite missing revenue estimates, ZIM’s strategic transformation and cost structure enhancements have led to profitable growth in Q1 2024.
GSK (GSK, Financial) announced that its experimental therapy for severe asthma, depemokimab, met the primary endpoints in two late-stage studies, showing significant reductions in asthma attacks. The trials involved 375 and 380 patients respectively, with the therapy given as adjunctive treatment on a six-month dosing schedule. The results support the efficacy and safety of depemokimab, which is part of GSK’s broader Phase 3 program for severe asthma treatments.
Visa (V, Financial) and Mastercard (MA, Financial) are facing scrutiny from the U.K.'s Payment Systems Regulator (PSR), which found that the two card payment networks have effectively no competition. The PSR reported that both companies have increased their scheme and processing fees by over 30% in the past five years, with little evidence of improved service quality. U.K. businesses have limited options but to pay these fees, as Visa and Mastercard account for 95% of transactions using UK-issued cards.
Alibaba (BABA, Financial) has significantly cut prices for some of its AI services by up to 97%, prompting a response from rival Baidu (BIDU, Financial), which announced free services based on its Ernie AI models. This price war marks the beginning of intense competition in China’s growing AI industry, attracting billions of dollars in investment from various startups and established companies, including Tencent.
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