Log in
E-mail
Password
Show password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 

North American Morning Briefing: Stock Futures Waver Ahead of Earnings, Data

08/04/2021 | 05:58am EDT

MARKET WRAPS

Watch for:

U.S. ADP National Employment Report for July; U.S. ISM Report on Business Services for July; EIA Weekly Petroleum Status Report; CVS Health 2Q earnings; General Motors 2Q earnings; Kraft Heinz 2Q earnings; Uber Technologies 2Q earnings.

Opening Call:

Stock futures wobbled Wednesday ahead of more earnings reports and data on the services sector that would provide fresh insights into the pace of the economic recovery.

Stocks have ground higher this week amid strong earnings reports and signs that the economic rebound remains under way, albeit at a slower pace than in recent months. But the spread of the Delta variant of Covid-19 and a slowdown in the rate of vaccinations is prompting some concern that authorities may reimpose or tighten restrictions on social activity and travel.

"We're entering a stage where growth is still strong, but not as strong as the initial stage of the recovery," said Sebastian Mackay, multiasset fund manager at Invesco. "The implications for markets would be if earnings fail to sustain the very strong performance they have been reporting. Are we entering a stage of the cycle where earnings are still reasonably robust, but the recovery is difficult to sustain?"

A purchasing managers' survey for the U.S. services sector in July is set to be released at 10 a.m. ET. Economists are expecting the data will show an increase as Americans shifted from spending on goods to in-person activities amid vaccinations and relaxed Covid-19 restrictions.

A report from ADP on employment levels in the private sector is also scheduled for 8:15 a.m., acting as a precursor to Friday's highly-anticipated jobs report from the government. Federal Reserve policy makers have said the recovery of the labor market is a key factor in monetary policy decisions.

Drugstore chain CVS Health, food and beverage giant Kraft Heinz, private-equity firm Apollo Global Management and auto maker General Motors are slated to report earnings ahead of the opening bell. Ride hailing giant Uber Technologies and Costco Wholesale are scheduled to report after markets close.

Overseas, the pan-continental Stoxx Europe 600 advanced 0.5%, extending gains after notching record closing levels for two days in a row. Purchasing managers' surveys showed an expansion in activity in the eurozone's manufacturing and services industries in July, albeit at a slower pace than the previous month.

Among European equities, Commerzbank declined 5% after it swung to a loss in the second quarter. Dutch coffee company JDE Peet's jumped over 5% after its profit more than tripled.

In Asia, most major benchmarks rose by the close of trading. The Shanghai Composite Index and Hong Kong's Hang Seng Index both rose 0.9%. China's Caixin purchasing managers' survey gauge of the services industry for July rose from the previous month.

New Zealand's dollar appreciated 0.7% against the greenback after a strong jobs report lifted expectations that the country's central bank may raise interest rates sooner than previously thought.

Forex:

Strong ADP private payrolls data due at 1215 GMT could raise prospects of strong nonfarm payrolls data Friday. If combined with some indication on "the start and end" of tapering of asset purchases in a speech by Federal Reserve Vice Chairman Richard Clarida, this could lift U.S. short rates and the dollar, ING said.

Dollar strength would be mainly against the low-yielding euro and Japanese yen, however, ING said.

ADP private payrolls are forecast to rise by 653,000 in July, according to a WSJ poll of economists.

The European Central Bank's looser-for-longer policy stance has driven the Swiss franc's recent gains against the euro, Commerzbank said.

"After the last ECB meeting, the market is additionally tending towards the assumption that monetary policy in the euro-area will remain expansionary for a long time even after the pandemic, which in turn is weighing on the EUR/CHF rate," Commerzbank's Thu Lan Nguyen said.

That may not be reflected in EUR/USD as the Federal Reserve's strategy also allows for prolonged expansionary policy, she said.

Once the pandemic eases, the safe haven franc's declines versus the euro might be limited, she says. EUR/CHF rose 0.1% to 1.0736, having reached its lowest level since November at 1.0719 overnight, according to FactSet.

Bonds:

In bond markets, the yield on the benchmark 10-year Treasury note edged up to 1.177% from 1.174% on Tuesday.

Ten-year U.S. Treasury yields might have more room to fall than their German peers, said ING's rates strategists. The bottom could be 1% for 10-year U.S. Treasury yields, while German Bund yields are probably closer to the bottom, they think.

Rates are on autopilot, trying to find the bottom of this year's trading range, while the main catalyst for a change in the current market dynamics would be bumper U.S. nonfarm payroll data on Friday, said ING's rates strategists.

Danske Bank lowers its forecasts for five-year eurozone government bond yields for the next 12 months because it no longer expects markets to price early interest rate rises by the ECB, said Danske's chief analyst Arne Lohmann Rasmussen.

The lower forecasts for five-year bond yields also feed into Danske's 10-year yield outlook for the eurozone, he said.

Accordingly, Danske expects the 10-year German Bund yields to rise to -0.25% by the end of the year and to 0.1% on a 12-month horizon, compared with the bank's previous forecasts of 0% and 0.3%, respectively.

Commodities:

Oil prices rose after both benchmarks ended Tuesday less than 1% down after at one point losing 3% each. This week's volatility has come as "worries continue to grow over the spread of the delta variant in China, " said ING's Warren Patterson.

With a number of cities now in lockdown and travel restrictions newly imposed, demand worries have weighed on oil prices.

Prices rebounded after suspected Iranian gunmen hijacked a tanker off the coast of the UAE. That follows an attack on an Israeli-operated tanker that the U.S. and U.K. blamed on Iran.

TODAY'S TOP HEADLINES

Facebook Cuts Off Access for NYU Research Into Political-Ad Targeting

Facebook Inc. cut off a New York University research project's accounts and access to the platform, effectively shutting down a study of the social-media giant's targeting of political ads.

The NYU Ad Observatory, launched last September by the university's engineering school, recruited more than 6,500 volunteers to use a special browser extension to collect data about the political ads Facebook shows them. Soon after, Facebook, which hadn't given permission for the project, demanded the researchers cease collecting the data.

Read More ->

Lockheed Launches CFO Search After Ken Possenriede Departs Suddenly

Aerospace and defense giant Lockheed Martin Corp. named a longtime company veteran to take over as acting chief financial officer following the sudden exit of its current CFO.

The Bethesda, Md.-based company said Tuesday that John Mollard, its vice president and treasurer, would step in temporarily for Ken Possenriede, who became CFO in February 2019. Mr. Possenriede will retire immediately for personal reasons, Lockheed Martin said. The company declined to comment further. The move comes ahead of the company's previously scheduled investor day on Thursday.

Read More ->

Amgen Disputes IRS Claim It Owes $3.6 Billion in Back Taxes

Amgen Inc. said it is gearing up for a fight with the Internal Revenue Service over a bill for billions of dollars in back taxes.

Amgen said Tuesday that it received notices from the IRS that seek to increase its federal tax bill by $3.6 billion, plus interest, for the years 2010, 2011 and 2012. Amgen filed a petition in U.S. Tax Court to dispute the notices, the company said in its second-quarter earnings release.

Read More ->

Hugo Boss Aims to Double Sales by 2025; to Focus on Online, China

Hugo Boss AG aims to sharply increase its revenue within the next five years, with a focus on digital sales and Chinese consumers, the German premium-fashion company said Wednesday.

Setting out its strategy to 2025, Hugo Boss said it is targeting revenue of 4 billion euros ($4.75 billion) by 2025. In 2020, the company made sales of EUR1.95 billion, though this was sharply down from the previous year's figure of EUR2.9 billion. As for profit, the company is aiming for a margin of earnings before interest and taxes of around 12% within the same timeframe.

Read More ->

Sony's Profit Buoyed by Electronics, Music Businesses

Sony Group Corp. said Wednesday that its first-quarter net profit rose 9.4% from a year earlier as stronger earnings from its electronics and music businesses offset weaker results from gaming.

The Japanese electronics and entertainment company said that net profit for the quarter ended June rose to 211.83 billion yen ($1.94 billion) from Yen193.58 billion a year earlier.

Read More ->

Possible Second Union Vote at Alabama Amazon Site Faces Uncertain Path

A recommendation by a National Labor Relations Board official has opened the door for a redo of a unionization vote at an Amazon.com Inc. facility in Alabama, renewing the possibility for a breakthrough victory for organized labor.

But the union leading the organizing effort is likely to face an arduous process and stiff opposition as it seeks to hold a new election, former labor officials and labor attorneys said. The outcome of any new vote also may not change from when workers voted against organizing in April, they added.

Read More ->

SK Innovation Shares Plunge on Spinoff Plan

SK Innovation Co.'s shares plunged Wednesday after its board decided to spin off its battery and gas exploration & production businesses as early as October.

The decision, yet to be approved by a shareholders' meeting on Sept. 16, stoked concerns about a potential valuation discount for the company if the two core-business units break away.

Read More ->

Woodside Raises Scarborough Capex Estimate by 5% to $12 Billion

(MORE TO FOLLOW) Dow Jones Newswires

08-04-21 0558ET

Stocks mentioned in the article
ChangeLast1st jan.
AMGEN INC. -0.67% 213.61 Delayed Quote.-7.09%
AUSTRALIAN DOLLAR / EURO (AUD/EUR) -0.21% 0.61801 Delayed Quote.-1.34%
BRITISH POUND / EURO (GBP/EUR) -0.22% 1.1648 Delayed Quote.4.45%
BRITISH POUND / US DOLLAR (GBP/USD) -0.37% 1.36605 Delayed Quote.0.34%
CANADIAN DOLLAR / EURO (CAD/EUR) 0.01% 0.674436 Delayed Quote.4.53%
CANADIAN DOLLAR / US DOLLAR (CAD/USD) 0.04% 0.79 Delayed Quote.0.57%
COSTCO WHOLESALE CORPORATION 3.31% 467.75 Delayed Quote.24.14%
CVS HEALTH CORPORATION -0.18% 84.71 Delayed Quote.24.03%
DJ INDUSTRIAL 0.10% 34798 Delayed Quote.13.59%
EURO / DIRHAM (EUR/AED) 0.04% 4.3059 Delayed Quote.-3.90%
EURO / US DOLLAR (EUR/USD) 0.03% 1.17248 Delayed Quote.-3.88%
FACEBOOK INC 2.02% 352.96 Delayed Quote.29.21%
HANG SENG -1.35% 24155.4 Real-time Quote.-11.29%
HUGO BOSS AG 0.00% 53 Delayed Quote.94.21%
INDIAN RUPEE / EURO (INR/EUR) 0.18% 0.011559 Delayed Quote.2.98%
INDIAN RUPEE / US DOLLAR (INR/USD) -0.01% 0.013548 Delayed Quote.-1.04%
INVESCO LTD. 0.36% 24.94 Delayed Quote.43.09%
LONDON BRENT OIL 0.94% 78.01 Delayed Quote.49.38%
NEW ZEALAND DOLLAR / US DOLLAR (NZD/USD) -0.04% 0.7009 Delayed Quote.-1.60%
SONY GROUP CORPORATION 5.18% 13000 End-of-day quote.26.40%
THE KRAFT HEINZ COMPANY 0.22% 36.39 Delayed Quote.4.99%
US DOLLAR / DIRHAM (USD/AED) 0.01% 3.6726 Delayed Quote.0.00%
US DOLLAR / EURO (USD/EUR) -0.03% 0.852893 Delayed Quote.4.04%
WTI 0.93% 73.961 Delayed Quote.52.07%
Latest news "Markets"
09/24Dow Jones Industrial Average : S&P 500 edges higher after bumpy week, Nike drags
RE
09/24The WSJ Dollar Index Rises 0.12% to 87.90 -- Data Talk
DJ
09/24ADRs End Lower; WPP, BioNTech Among Companies Actively Trading
DJ
09/24S&P/TSX Composite Index Ends the Week 0.43% Lower at 20402.66 -- Data Talk
DJ
09/24BOVESPA Index Ends the Week 1.65% Higher at 113282.67 -- Data Talk
DJ
09/24IPC Indice de Precios Y Cotizaciones Ends the Week 0.39% Lower at 51105.71 -- Data Talk
DJ
09/24S&P MERVAL Index Ends the Week 5.52% Lower at 74180.20 -- Data Talk
DJ
09/24CANADA STOCKS - TSX falls 0.29% toá20,402.66
RE
09/24WALL STREET STOCK EXCHANGE : Dow, S&P 500 end with gains up after bumpy week, but Nike drags
RE
09/24CHINA EVERGRANDE : S&P 500 edges up, European shares slump amid Evergrande fears, US yields rise
RE
Latest news "Markets"