The stock futures are experiencing a slight downturn this morning. S&P 500 futures are down 5 points, Nasdaq 100 futures are down 20 points, and Dow Jones Industrial Average futures have fallen by 25 points, each reflecting a 0.1% decrease.
This cautious sentiment comes as investors await the September Consumer Price Index (CPI) and the weekly jobless claims report, both due at 8:30 ET. Treasury yields have risen ahead of these releases, with the 10-year yield up three basis points to 4.09% and the 2-year yield up four basis points to 4.05%.
Oil prices have increased after a previous decline. WTI crude oil futures have risen 1.1% to $74.07 per barrel.
Today's News
In September, the Consumer Price Index (CPI) showed a stronger-than-expected rise of 0.2% month-over-month, aligning with August's increase, according to the U.S. Bureau of Labor Statistics. The headline CPI rose 2.4% year-over-year, slightly above expectations. Core CPI, excluding food and energy, also stalled, rising 0.3% month-over-month. This inflation stall could influence upcoming Federal Reserve decisions, impacting economic forecasts and market dynamics.
Initial jobless claims for the week ending October 5 increased by 33,000 to 258,000, surpassing the consensus of 231,000. The rise in claims was attributed to special factors such as hurricanes and union strikes. Continuing claims also rose to 1.861 million, exceeding expectations, reflecting ongoing labor market challenges.
PayPal Holdings (PYPL, Financial) saw a pre-market decline of 1.70% following a downgrade by Bernstein due to competitive and valuation concerns. Despite improved product velocity, competitive pressures and interest rate exposure pose risks, leading to a revised price target of $80.
Delta Air Lines (DAL, Financial) experienced a drop in early trading after reporting revenue of $14.6 billion, missing consensus estimates. The airline's Q4 guidance also fell short, with operating margins decreasing to 8.9% from 12.8% a year ago. The company faced significant costs from a CrowdStrike-related outage, affecting customer compensation and flight cancellations.
Arcadium Lithium (ALTM, Financial) was downgraded to Hold by HSBC after Rio Tinto's $6.7 billion acquisition offer. The deal, which saw ALTM shares surge 31%, is considered fairly valued despite potential risks related to capacity and financing. HSBC sees minimal antitrust hurdles to the deal's completion.
Former Pfizer (PFE, Financial) executives Ian Read and Frank D'Amelio withdrew from an activist campaign against the company led by Starboard Value. The executives expressed support for current CEO Albert Bourla and the board, indicating confidence in Pfizer's future shareholder value.
Recursion (RXRX, Financial) and Exscientia (EXAI) are seeking shareholder approval for their merger, with meetings scheduled for November 12. The all-stock deal involves RXRX acquiring EXAI, backed by Nvidia (NVDA), to enhance AI-driven drug discovery capabilities.
Tilray Brands (TLRY, Financial) CEO Irwin Simon expressed optimism about potential cannabis industry reforms amid the U.S. presidential elections. TLRY's Q1 financial results exceeded earnings expectations but missed on revenue, highlighting the significance of regulatory changes for the industry.
Amazon (AMZN) and Apple (AAPL, Financial) announced a collaboration to offer Apple TV+ through Amazon's Prime Video service for $9.99 per month. This strategic move aims to expand Apple's streaming reach and compete with major players like Netflix (NFLX) and Disney+ (DIS).
Toronto-Dominion Bank (TD, Financial) is expected to face $3 billion in penalties and U.S. expansion restrictions due to money laundering prevention failures. The settlement will include an asset cap and criminal charges, with independent monitors ensuring compliance.
Berkshire Hathaway (BRK.A, BRK.B) raised $1.9 billion through a yen-denominated bond deal, marking its largest Samurai bond issuance since 2019. The proceeds will be allocated for general corporate purposes, with bonds issued across various maturities.
Skyworks Solutions (SWKS, Financial) and Cirrus Logic (CRUS) were downgraded by Barclays due to revised smartphone expectations. SWKS fell 2.8% and CRUS 1.8% pre-market, with price targets cut to $87 and $120, respectively, reflecting anticipated changes in iPhone content.
Mastercard (MA, Financial) and Citigroup (C) are partnering to launch Mastercard Move, a service facilitating cross-border debit card payments. Citigroup will be the first global bank to use this service, enhancing payment options for insurance, airline refunds, and e-commerce.
Tempest Therapeutics (TPST, Financial) shares surged 29% pre-market after announcing a partnership with Roche (RHHBY) to develop its lead asset amezalpat. The collaboration will support a Phase 3 trial for liver cancer treatment, combining amezalpat with Roche's Tecentriq.
IBM (IBM) received a price target upgrade from RBC Capital Markets, citing improved sentiment and expected strong cash flow in Q3 results. The company anticipates increased software sales, particularly from Red Hat, contributing to its growth trajectory.
United Airlines (UAL) announced its largest international expansion, adding eight new cities to its network by 2025. The expansion includes unique destinations from Newark and Washington D.C., enhancing UAL's transatlantic offerings with over 760 weekly flights.
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