Coffee With Greta: Traders Buy a Scary Dip
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DJIA Futures: +171 (+0.5%)
SPX Futures: +28 (+0.7%)
NASDAQ Futures: +124 (+0.9%)
Good morning friends!
Futures are up as the market continues to monitor the conflict in Ukraine and digests new economic data.
Let’s get right to it!
PCE Inflation Surges in January
The Bureau of Economic Analysis reported the PCE price index rose 0.6% monthly in January and surged 6.1% year-over-year.
That was in-line with economists' expectations and is the fastest pace of annual inflation since 1984.
The Core PCE Index, which excludes food and energy prices, rose 0.5% monthly and 5.2% annually.
That's the fastest year-over-year increase since 1983.
Core PCE is the Fed's preferred measure of inflation.
Consumer Spending Bounces Back
The Bureau of Economic Analysis reported consumer spending jumped 2.1% in January.
That was higher than expectations for a 1.6% increase and a rebound from the 0.6% decline in December.
Americans spent $285.4 billion more on goods in January and $51.8 billion more on services.
Russia Closes In on Kyiv
Russia continued its offensive on Ukraine overnight.
Russian forces are now said to be closing in on the capital city of Kyiv.
Ukraine’s Foreign Minister says the city has been hit by “horrific Russian rocket strikes”.
This comes as EU leaders agreed to freeze European assets held by Russian President Vladimir Putin and Foreign Minister Sergei Lavrov.
Russia says it will impose retaliatory sanctions on the West, after the U.S. and its European partners announced Russian sanctions Thursday.
The UN says there have been at least 127 civilian casualties in Ukraine.
President Biden is set to participate in an emergency virtual NATO summit this morning.
Russia linked stocks in the U.S. are rebounding ahead of the open, with the VanEck Russia ETF (RSX) up 8.5% after plunging in recent sessions.
Block Jumps on Q4 Earnings Beat
Block (SQ) – formerly Square – shares are surging 19.6% in premarket trade after the digital payments company beat Q4 expectations.
The company reported adjusted earnings of $0.27 per share on $4.08 billion in revenue.
That beat consensus expectations for adjusted EPS of $0.23 on $4.04 billion in revenue.
Block’s Square seller business brought in gross profits of $657 million while Cash App saw gross profit of $518 million, both beat expectations.
The company said, “we saw strength in recurring paycheck deposits, which we view as a key barometer of customers using Cash App for their primary banking needs.”
Coinbase Crushes Q4 Expectations
Coinbase (COIN) shares are up 1.9% ahead of the open after a huge Q4 earnings beat on the top and bottom line.
The cryptocurrency exchange reported earnings of $3.32 per share on $2.5 billion in revenue.
That crushed analysts’ expectations for EPS of $1.85 on $1.94 billion in revenue.
But Coinbase forecast its retail Monthly Transaction Users and total trading volume will be lower this quarter compared to Q4.
The company cited the decreased volatility in crypto and the 20% drop in the global crypto market cap so far this quarter for that outlook.
Beyond Meat Tumbles on Earnings Miss
Beyond Meat (BYND) shares are dropping 11.2% in premarket trade after the alternative meat company sharply missed Q expectations.
Beyond Meat reported a loss of $1.27 per share on $100.7 million in revenue.
That was worse than analysts’ expectations for a $0.71 per share loss on $101.4 million in revenue.
Revenue was down 1.2% compared to Q3 as U.S. grocery store sales tumbled 19.5%.
Beyond Meat forecast revenue between $560 million and $620 million this year, shy of analysts’ expectations.
Consumer Sentiment Preview
The University of Michigan reports Consumer Sentiment at 10:00 a.m. ET.
Economists expect the index to be unchanged from the earlier flash reading of 61.7.
The survey also includes consumer expectations for inflation over the next year and 5-years.
Pending Home Sales Preview
The National Association of Realtors reports January pending home sales at 10:00 a.m. ET.
Consensus expectations are that contract signings rose 1.0% last month after tumbling 3.1% in December.
Pending sales represent home sales that will close in 30 to 90 days.
In Case You Missed It
- Wall Street staged a stunning reversal of losses Thursday. The Dow ended the session 92 points higher after being down 859 points at its session low. The Nasdaq closed the day 3.3% higher after dropping 3.5% earlier in the session. And the S&P 500 settled 1.5% higher after falling 2.6% earlier in the day. All three indexes remain in correction, but the Nasdaq rebounded from bear market territory.