Early Look

Wednesday, November 27, 2024

U.S. futures are modestly lower after finishing Tuesday at the highs of the session as attention turns to the Fed’s preferred inflation reading later this morning (core PCE) ahead of tomorrow’s stock market closure for Thanksgiving Day. Stocks rose on Tuesday as the S&P 500 notched its 52nd record close this year as momentum remains strong into the end of the month. @charliebilello noted “The S&P 500 closed at an all-time high today for the 52nd time this year. The only years with more all-time highs: 1995 (77), 2021 (70), 1964 (65), 2017 (62), 2014 (53), 1961 (53).” Markets shook off news yesterday of Donald Trump’s plan to impose additional tariffs on top US trading partners Canada, Mexico and China as the Nasdaq (up 4-straight day), Dow (up 5- straight day) and S&P (up 7-straight days) all advanced while the Russell 2000 snapped its 6-day winning streak. Oil prices fell after Israel’s Security Cabinet approved cease-fire deal with Hezbollah late day. Major U.S. averages also advanced despite minutes from the November FOMC policy meeting showing support for a careful approach to rate cuts. In Asian markets, The Nikkei Index fell -307 points to 38,134, the Shanghai Index rose 50 points to 3,309, and the Hang Seng Index gained 443 points to 19,603. In Europe, the German DAX is down -134 points to 19,161, while the FTSE 100 is up slightly at 8,262. In geopolitical news, a cease-fire between Israel and the Lebanese militant group Hezbollah started early Wednesday, after the sides reached a deal following weeks of US-mediated talks. Nasdaq futures are down slightly more after a round of tech earnings disappointed last night (DELL, CRWD, ADSK, HPQ).

• The Dow Jones Industrial Average rose 123.74 points, or 0.28%, to 44,860.31.
• The Nasdaq Composite jumped 119.46 points, or 0.63%, to 19,174.30.
• The Russell 2000 Index declined -17.72 points, or 0.73% to 2,424.31.

• 8:30 AM ET                  Gross Domestic Product (GDP) Q3 2^nd estimate…est. +2.8%
• 8:30 AM ET GDP Price Deflator for Q3…est. +1.8%
• 8:30 AM ET                  Personal Consumption for Q3
• 8:30 AM ET PCE Prices M/M for Q3 2^nd estimate
• 8:30 AM ET PCE Prices Y/Y for Q3 2nd estimate
• 8:30 AM ET                  Durable Goods Orders M/M for October…est. +0.5%
• 8:30 AM ET                  Weekly Jobless Claims…est. 216K
• 8:30 AM ET                  Continuing claims…est. 1.908M
• 8:30 AM ET                  Advance Goods Trade Balance for October
• 10:00 AM ET                Personal Income and Savings for October…est. +0.3%
• 10:00 AM ET PCE Price Index M/M for October…est. +0.2%
• 10:00 AM ET PCE Price Index Y/Y for October…est. +2.3%
• 10:00 AM ET                Core PCE Price Index M/M for October…est. +0.3%
• 10:00 AM ET                Core PCE Price Index Y/Y for October…est. +2.8%
• 10:00 AM ET                Pending Home Sales M/M for October…est. (-0.2%)
• 10:30 AM ET                Weekly DOE Inventory Data
• 1:00 PM ET US Treasury to sell $44B in 7-year notes

• Nordstrom (JWN) Q3 adj EPS $0.33 vs. est. $0.22; Q3 revs rose 4.3% y/y to $3.46B vs. est. $3.35B; Q3 comp store sales rose +4% while guides FY24 same-store sales up 1%-2%; raises FY revenue to be flat or grow by up to 1% y/y, up from its prior outlook for a drop of no more than 1% or rise of up to 1% in revenue. Nordstrom logged sales growth of 1.3%, to $2.08 billion, while Nordstrom Rack saw higher sales of 11%, to $1.27 billion.
• Urban Outfitters (URBN) Q3 EPS $1.10 tops consensus $0.85; Q3 revenue rose 6.3% y/y to $1.36B vs. est. $1.34B; Q3 comparable retail segment net sales increased 1.5% vs. est. 1.27%; Q3 Comparable Retail segment net sales increased 5.8% at Anthropologie and 5.3% at Free People and decreased 8.9% at Urban Outfitters. Nuuly segment net sales increased by 48.4% primarily driven by a 51% increase in average active subscribers.

• BYD Co. (BYDDY) has asked suppliers to accept price cuts next year in a signal the Chinese electric vehicle maker is preparing for the brutal price war in the world’s biggest auto market to intensify – Bloomberg.
• SolarEdge Technologies Inc (SEDG) announces discontinuation of energy storage division, said to reduce headcount by approximately 500 employees or about 12% of total count and said charges include $40M-$49M asset-related, $30M-$37M inventory write-offs, $4M-$5M severance.
• Volkswagen (VWAGY) has struck an agreement to exit its car factory in Xinjiang following years of pressure from investors and activists about alleged human rights abuses. VW said it had reached a deal with its local partner SAIC Motor to sell the controversial assembly plant in Urumqi, Xinjiang which it first opened in 2013.

• Grifols’ (GRFS) shares slide following a report that Brookfield Asset Management plans to abandon its acquisition of the Spanish pharmaceuticals company. Bloomberg reported overnight that Brookfield is preparing to drop its 6.45 billion euro ($6.77 billion) bid to acquire Grifols after failing to reach an agreement with its board on price.

• Autodesk (ADSK) Q3 adj EPS $2.17 vs est. $2.12 on revs $1.57B vs est. $1.562B, adj EBIT mgn 36%; guides Q4 revs $1.623-1.638B vs est. $1.621B, adj EPS $2.10-2.16 vs est. $2.12; sees FY revs $6.115-6.13B vs est. $6.108B, adj op mgn 35.5-36.0% and adj EPS $8.29-8.35 vs est. $8.27.
• CrowdStrike (CRWD) Q3 adj EPS $0.93 vs est. $0.81 on revs $1.01B vs est. $982.36Mm; sees Q4 revs $1.029-1.035B vs est. $1.031B, adj op Inc $184-189Mm vs est. $186.16Mm and adj EPS $0.84-0.86 vs est. $0.86.
• Dell Inc. (DELL) Q3 adj EPS $2.15 vs. est. $2.06; Q3 revs $24.4B vs. est. $24.72B; Q3 Infrastructure Solutions Group revenue of $11.4B, up 34% y/y; Q3 servers and networking revenue of $7.4B, up 58% y/y; Q3 Client Solutions Group revenue of $12.1B, down 1% y/y, with commercial client revenue up 3% at $10.1B.
• HP Inc. (HPQ) Q4 adj EPS $0.93 vs est. $0.93 on revs $14.1B vs est. $13.986B; guides Q1adj EPS $0.70-0.76 vs est. $0.85 and FY adj EPS $3.45-3.75 vs est. $3.60.
• Nutanix (NTNX) Q1 adj EPS $0.42 vs. est. $0.32; Q1 revs $591M vs. est. $571.8M; Q1 adj gross margin 87.5%; Q1 adj operating income $118.2M vs. est. $87M; guides Q2 revs $635M-$645M vs. est. $631M; guides FY25 revs $2.435B-$2.465B.
• PagerDuty (PD) Q3 adj EPS $0.28 vs est. $0.17, adj op Inc $25Mm vs est. $15.48Mm on revs $118.9Mm vs est. $116.52Mm; guides Q4 revs $118.5-120.5Mm vs est. $121.6Mm and adj EPS $0.15-0.16 vs est. $0.16; sees FY revs $464.5-466.5Mm vs est. $465.27Mm and adj EPS $0.78-0.79 vs est. $0.71.
• Workday (WDAY) Q3 adj EPS $1.89 vs est. $1.76, adj op Inc $569Mm vs est. $539.7Mm on revs $2.16B vs est. $2.13B; guides Q4 subscription revs $2.025B vs est. $2.195B and adj op mgn 25%.
• 3D Systems (DDD) Q3 DJ EPS ($0.12) vs est. ($0.10), adj EBITDA ($14.3)Mm vs est. ($5.779)Mm on revs $112.9Mm vs est. $115.27Mm, adj gr mgn 37.6%; guides FY revs $440-450Mm vs est. $452.89Mm, FY adj gr mgn 38-40%, Q4 adj op exp less than $60Mm, adj EBITDA to improve sequentially.
• Global smartphone sales rebounded strongly in 2024 after two successive years of decline, but Apple Inc. (AAPL) barely managed growth, a study by IDC showed. Apple and its rivals will ship 6.2% more phones or an estimated 1.24 billion units in 2024, according to market tracker IDC. But iPhone volumes likely edged just 0.4% higher.