Coffee With Greta: Earnings In Focus
DJIA Futures: +169 (+0.5%)
SPX Futures: +27 (+0.7%)
NASDAQ Futures: +93 (+0.8%)
Good morning friends!
Futures are higher as Q2 earnings continue to roll in.
Let’s get right to it!
Johnson & Johnson Beats Profit Expectations, Trims Forecast
Johnson & Johnson (JNJ) shares are up 0.8% ahead of the open after beating Q2 profit expectations.
The pharmaceutical giant reported adjusted earnings of $2.59 per share on $24 billion in revenue.
That topped analysts’ expectations for adjusted EPS of $2.54 on $23.8 billion in revenue.
Overall revenue rose 3% year-over-year while pharmaceutical sales were up 6.7%.
But Johnson & Johnson cut its full-year outlook, citing a stronger dollar.
The company now expects adjusted earnings of $10 to $10.10 per share in 2022 vs previous guidance for $10.15 to $10.35.
The full-year revenue forecast was lowered to $93.3 billion to $93.4 billion from $94.8 billion to $95.8 billion.
Hasbro Reports Mixed Q2 Results
Hasbro (HAS) shares are up 0.8% in premarket trade after mixed second-quarter results.
The toymaker reported earnings of $1.15 per share vs analysts’ expectations for $0.94.
But the company’s $1.34 billion in revenue was shy of estimates for $1.37 billion.
Adjusted operating margins expanded to 18% from 16% even as freight costs rose.
Hasbro said it saw stronger demand for its tabletop games, which cost less to produce.
The company also benefited from higher prices on its toys like Nerf blasters and My Little Pony figures.
IBM Beats Q2 Expectations, Stock Slips On Outlook
IBM (IBM) shares are down 6% ahead of the open despite beating Q2 expectations on the top and bottom line.
The company reported adjusted earnings of $2.31 per share on $15.54 billion in revenue.
That topped analysts’ expectations for adjusted EPS of $2.27 on $15.18 billion in revenue.
Revenue rose 9% year-over-year.
The stock is dropping though after IBM cut its forecast for full-year free cash flow.
The company now expects $10 billion in free cash flow for all of 2022, down from the previous range of $10 billion to $10.5 billion.
Housing Starts Tumble in June
U.S. home construction fell more than expected in June.
The Census Bureau reported housing starts fell 2% to a seasonally adjusted annual rate of 1.56 million units.
That was worse than expectation for starts to be unchanged from May at an SAAR of 1.59 million units.
Starts were down 6.3% compared to June 2021.
Single-family starts plunged 8.1% from May while multi-family starts jumped 15%.
Building permits slowed less than expected, falling 0.6% to an SAAR of 1.69 million units vs 1.68 million expected.
Single-family permits tumbled 8.1% while multi-family permits rose 13.1%.
Treasury Yields Rise, 2-year/10-year Curve Remains Inverted
Treasury yields are rising this morning and a key part of the yield curve is still inverted.
The 2-year yield is hovering around 3.17% while the 10-year yield is at 2.99%.
The market’s Fed expectations held steady from yesterday.
CME Group’s FedWatch Tool shows 66.8% of traders still expect a 0.75% hike while 33.2% expect a 1% move.
Oil Prices Give Up Rally
Oil prices turned lower today as recession fears takeover supply concerns.
West Texas Intermediate crude futures are down 1.6% to under $101 bbl while Brent crude futures are down 1.4% to under $105 bbl.
The dollar also fell to a one-week low level, making oil slightly cheaper for buyers holding other currencies.
The American Petroleum Institute will report U.S. supply levels later today.
Gas Prices Continue To Tumble
U.S. gas prices fell for the 34th day in a row today.
AAA shows the national average for regular gas fell nearly 3 cents overnight to $4.495/gal.
The national average for diesel also fell 2 cents overnight to $5.515/gal.
In Case You Missed It
- Homebuilder sentiment plunged in July as buyers pullback. The NAHB sentiment index dropped 12 points to 55 this month vs expectations for 66. It was the steepest drop on record besides the plunge at the start of the pandemic. Sentiment about buyer traffic dropped 11 points to 37, solidly in negative territory.
- Bloomberg reported Monday afternoon that Apple (AAPL) plans to slow hiring and spending growth due to concerns over a slowing economy. Sources say the cuts will not impact all teams at the company. Apple is reportedly still planning to launch a mixed reality headset in 2023.