Early Look

Wednesday, August 21, 2024

U.S. futures are edging higher to start the day after declining modestly on Tuesday, as the S&P 500 and Nasdaq snapped their longest win streaks of 2024, 8-days, as markets await key Fed Chairman Powell comments later this week on rates and the economy. Today brings fresh events to the table as the Bureau of Labor Statistics (BLS) will release its preliminary payrolls revisions expected to show slower jobs growth, while the FOMC releases the minutes of its July meeting at 2:00 PM, with traders looking for a signal for a September rate cut. The U.S. Treasury will hold a $13B 20-year auction at 1:00 PM ET. Crude-oil prices fell for a third day on Tuesday, sparking the energy sector selloff, while defensive Healthcare, Staples advanced. Stock indexes have rapidly rebounded toward records over the last two weeks after a combination of economic fears and risk-cutting by hedge funds sent stocks sharply lower to start August. This morning, retailing giant Target (TGT) reported better Q2 results and raised its outlook for the year, echoing the results from Wal-Mart (WMT) last week that boosted consumer discretionary stocks and has helped give futures a little bump. In Asian markets, The Nikkei Index fell -111 points to 37,951, the Shanghai Index dipped -10 points to 2,856, and the Hang Seng Index dropped -120 points to 17,391. In Europe, the German DAX is up 60 points to 18,418, while the FTSE 100 gains 14 points to 8,287. The dollar index (DXY) is flattish around 101.50, looking to snap its 3-day decline as it hovers at its lowest levels since the end of December, while gold pulls back from all-time highs.

• The Dow Jones Industrial Average fell -61.56 points, or 0.15%, to 40,834.97.
• The Nasdaq Composite dropped -59.83 points, or 0.33%, to 17,816.94.
• The Russell 2000 Index declined -25.31 points, or 1.17% to 2,142.19.

• 10:30 AM ET                Weekly DOE Inventory Data
• 1:00 PM ET U.S. Treasury to sell $13B in 20-year notes.
• 2:00 PMET FOMC Meeting Minutes from July 31^st

• Earnings After the Close: A NDSN SNOW SNPS UFI URBN WOLF ZM

• Wells Fargo FinTech, Information & Business Services Forum, 8/21-8/22 in Newport

• Chewy (CHWY) downgraded to Market Perform from Outperform at Raymond James.
• Coca-Cola (COKE) consolidated announces $1B share buyback.
• Coty Inc. (COTY) Q4 adj EPS ($0.03) vs est. $0.04, adj EBITDA $164.5Mm vs est. $165.52Mm, adj op Inc $108Mm vs est. $104Mm on revs $1.36B vs est. $1.376B; guides Q1 LFL +6% and FY25 +6-8%, FY adj EBITDA $1.186-1.208B vs est. $1.198B, gr mgn expansion and adj EPS ex equity swap of $0.54-0.57 vs est. $0.57.
• John B Sanfilippo (JBSS) Q4 EPS $0.86 on sales $269.572Mm, gr mgn 18.5%; re: 2025 says will continue to execute on strategic plan, focus on creating volume growth opportunities, embracing innovation, capitalize on opportunities to increase distribution; cautiously optimistic the core nut and trail mix categories will continue to recover.
• La-Z-Boy (LZB) Q1 adj EPS $0.62 vs. est. $0.60; Q1 sales rose 2.9% y/y to $495.5M vs. est. $481.5M; Wholesale segment sales increased 5% on growth to external customers; delivered sales & Non-GAAP operating margin in line with guidance; Q1 total written sales for the Retail segment up 4% y/y and written same-store sales down 3% y/y; guided Q2 revenue $495M-$515M, below consensus of $518.4M.
• Toll Brothers (TOL) Q3 revs $2.72B vs. est. $2.71B and operating income $597.2M vs. est. $484.4M; Q3 Backlog value was $7.07B, down -10% y/y; Home sales gross margin was 27.4% vs. 27.8% y/y; Net signed contract value was $2.41 billion, up 11% y/y; sees FY24 adj. home sales gross margin 28.3% above prior 28%, deliveries 10,650-10,750 vs. prior 10,400-10,800 and guides SG&A expenses as percentage of home sales revs 9.4%, down from prior 9.6%; forecasts FY diluted EPS $14.50 to $14.75, above prior forecast about $14.
• JT Group agreed to buy cigarette maker Vector Group Ltd. (VGR) for about $2.4 billion to expand the Japanese tobacco company’s position in the US. JT Group will acquire all Vector for $15 a share, according to a statement Wednesday.
• Walmart (WMT) has sold its stake in JD.com (JD), ending an eight-year investment in the Chinese e-commerce company. WMT sold 144.5 million American depositary receipts in JD.com at $24.95 apiece.

• ZTO Express (ZTO) Q2 adjusted EPS $0.47 vs. est. $0.45; Q2 revs $1.48B vs. consensus $1.5B; maintains its previously stated annual guidance. Parcel volume for 2024 is expected to be in the range of 34.73B-35.64B, representing a 15% to 18% increase year over year.

• JK Henry & Associates (JKHY) Q4 EPS $1.38 vs est. $1.32, adj op Inc $120.032Mm vs es.t $123.86Mm on revs $559.9Mm (adj revs $553.219Mm) vs est. $563.46Mm; guides FY25 revs $2.369-2.391B (adj revs $2.353-2.375B) vs est. $2.371B, adj op mgn 22.7-22.8% and EPS $5.78-5.87 vs est. $5.76.
• Tether, said on Wednesday it plans to provide a new stablecoin pegged to the United Arab Emirates (UAE) dirham as it taps demand for the Gulf currency and seeks to offer alternatives to the U.S. dollar.

• Reviva Pharmaceuticals (RVPH) 4.76M share Secondary priced at $1.05.

• 3D Systems (DDD) Q1 adj EPS ($0.17) vs est. ($0.15), adj EBITDA ($20.1Mm) vs est. ($7.62Mm) on revs $102.9Mm vs est. $106.59Mm, adj gr mgn 40.1%; guides Q2 revs $113.0-113.5Mm vs est. $116.46Mm; sees sequential revs improvement throughout balance of 2024.
• Keysight Technologies (KEYS) Q3 adj EPS $1.57 vs est. $1.35 on revs $1.22B vs est. $1.194B; guides Q4 revs $1.25-1.26B vs est. $1.25B and adj EPS $1.53-1.59 vs est. $1.34.
• Liberty Media Corp (FWONA) files for offering of up to 10.65M shares of series C Liberty formula one common stock.
• Microchip Technology (MCHP) said on August 17 it detected potentially suspicious activity involving its information technology systems. Upon detecting the issue, the company began taking steps to assess, contain and remediate the potentially unauthorized activity.