Coffee With Greta: Traders Just Bought The Dip
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DJIA Futures: +308 (+1%)
SPX Futures: +35 (+0.9%)
NASDAQ Futures: +70 +(0.6%)
Good morning friends!
Futures are higher as markets attempt to bounce back from an intense sell-off.
Let’s get right to it!
Traders Just Bought the Dip with More Retail Earnings Ahead
Traders are attempting to recover some of the recent losses after an intense sell-off on Wall Street.
The S&P 500 is still hovering just above a bear market after briefly dropping into that territory on Friday.
The Dow logged its first 8-week losing streak since 1932 last week.
The Nasdaq and the S&P have both fallen for 7 straight weeks for the first time since 2001.
But the market will have a close eye on a slew of retail earnings this week after disappointing results from Target (TGT) and Walmart (WMT) last week.
Best Buy (BBY) and Nordstrom (JWN) are up first on Tuesday.
And then Costco (COST), Dollar Tree (DLTR), Dollar General (DG), and Macy’s (M) report earnings on Thursday.
More bad retail results could prompt a further selloff after Target and Walmart’s earnings showed consumers shifting their spending habits due to inflation.
Other key earnings this week include Zoom (ZM), Intuit (INTU), Nvidia (NVDA), and Alibaba (BABA).
Key Economic Data This Week
There’s no economic data on the schedule today but traders have their eyes on some key reports this week.
The S&P Global May manufacturing and services PMIs will both be released Tuesday morning while the Census Bureau is set to report new home sales for April.
Then on Wednesday, the Commerce Department reports durable goods orders and core capital equipment orders for April and the Fed releases the minutes of its May meeting.
The Commerce Department releases its first revision of Q1 GDP growth on Thursday while the National Association of Realtors reports pending home sales for April.
And Friday it’s all about inflation with the Bureau of Labor Statistics set to release the April personal consumption expenditures price index.
Oil Prices Rise On High Demand, Tight Supply
Oil prices are rising today amid high demand for fuel in the U.S. and tight supply of oil.
West Texas Intermediate crude futures are up more than 1% to over $111 bbl while Brent crude futures are rising 1% to nearly $114 bbl.
The U.S. is heading into its peak driving season, which typically begins Memorial Day weekend and ends on Labor Day.
Even as gas prices have hit record highs in recent weeks, mobility data from TomTom and Google has shown an increase in people driving.
Gas Prices Hit 14th Straight Record-High
U.S. gas prices hit a new record high for the 14th straight day today.
AAA shows the national average rose to $4.596 overnight.
That’s up more than 11 cents from a week ago and more than 47 cents compared to one month ago.
At this same time last year, a gallon of regular gas cost just $3.039.
Diesel prices have cooled after hitting a record-high last week.
A gallon of diesel now costs $5.554, down from $5.577 on May 18.
VMware Surges On Rumored Broadcom Acquisition
VMware (VMW)) shares are surging 20.7% ahead of the open amid reports chipmaker Broadcom (AVGO) is in talks to acquire the company.
Reuters reported negotiations are ongoing and a deal is not imminent.
No details of a potential deal are known but Wells Fargo analysts said, “We believe an acquisition of VMware would be considered as making strategic sense; consistent with Broadcom’s focus on building out a deepening enterprise infrastructure software strategy.”
Broadcom shares are slipping 4.9% in premarket trade.
GameStop Launches Crypto, NFT Wallet
GameStop (GME) shares are up 2.8% ahead of the open after launching its digital asset wallet for crypto and NFTs.
The company said the wallet will “allow gamers and others to store, send, receive, and use cryptocurrencies and non-fungible tokens across decentralized apps without having to leave their web browsers.”
GameStop also said it “is a self-custodial Ethereum wallet.”
A wallet extension can be downloaded on Google Chrome which will later enable transactions on GameStop’s upcoming NFT marketplace.
The company said that is expected to launch in fiscal Q2.
World Economic Forum Underway In Davos
More than 2,000 world leaders, economic experts, and business leaders are gathered in Davos, Switzerland for the 2022 World Economic Forum.
The meeting kicked off Sunday and this is the first in-person summit since January 2020.
The theme of this year’s meeting is “History at a Turning Point”.
Russia was excluded from the annual meeting due to the war in Ukraine while Ukrainian President Volodymyr Zelenskyy will address the summit via video.
U.S. climate envoy John Kerry is attending the summit but President Biden is not.
The meeting is expected to focus on war, with panels on climate change, rising energy prices, global supply chain issues, poverty, and the metaverse.