Coffee With Greta: New Week Kicks Off
DJIA Futures: -197 (-0.6%)
SPX Futures: -35 (-0.8%)
NASDAQ Futures: -142 (-1.1%)
Good morning friends!
Futures are falling as traders look ahead to a busy week of earnings and an upcoming speech by Fed Chair Jerome Powell.
Let’s get right to it!
Tyson Shares Slides As Earnings Miss
Tyson Foods (TSN) shares are falling 4.8% ahead of the open after missing fiscal Q1 expectations on the top and bottom line.
Here’s how the meat processing company’s results compared to analysts’ expectations:
- Adjusted EPS $0.85 vs $1.31 expected
- Revenue: $12.93 billion vs $13.52 billion expected
The CEO said, “We faced some challenges in the first quarter. Market dynamics and some operational inefficiencies impacted our profitability.”
Beef sales dropped to $4.72 billion from $5 billion a year ago while pork sales fell to $1.53 billion from $1.63 billion.
Tyson expects those sales declines to continue into the full year.
The company said, “For fiscal 2023, the United States Department of Agriculture (USDA) indicates domestic protein production (beef, pork, chicken and turkey) should be relatively flat compared to fiscal 2022 level.”
Tyson forecast fiscal 2023 sales to total between $55 billion and $57 billion vs analysts’ estimates of $55.19 billion.
Dell Announces Layoffs
Dell Technologies (DELL) shares are up 1.9% in premarket trade after announcing layoffs this morning.
A new SEC filing shows the PC company plans to layoff 5% of its workforce.
That would impact about 6,650 employees.
In a memo to employees, the company’s co-COO said, “There is no tougher decision, but one we had to make for our long-term health and success.”
Earnings In Focus
This will be a quieter week of economic data with the market’s main focus being on earnings.
Here’s a look at some of the companies scheduled to report this week:
- Monday PM: Activision Blizzer (ATVI), Pinterest (PINS), Spirit Airlines (SAVE)
- Tuesday PM: Chipotle (CMG)
- Wednesday AM: CVS (CVS), Uber (UBER)
- Wednesday PM: Walt Disney (DIS), Robinhood (HOOD)
- Thursday AM: Pepsico (PEP), Kellogg (K)
- Thursday PM: PayPal (PYPL), Lyft (LYFT)
Fed Speakers Hit The Circuit
The Fed also remains in focus this week with several central bank officials set to give speeches over the next two days.
Fed Chair Jerome Powell is scheduled to speak at the Economic Club of Washington at 12:40 p.m. EST on Tuesday.
Vice Chair Michael Barr will also give a speech Tuesday afternoon.
Then on Wednesday several officials are scheduled to speak throughout the day:
- New York Fed President John Williams
- Fed Governor Lisa Cook
- Vice Chair Michael
- Atlanta Fed President Raphael Bostic
- Minneapolis Fed President Neel Kashkari
- Fed Governor Christopher Waller
Traders are monitoring these speeches for more hints about the bank’s future plans for rate hikes.
After last week’s Fed meeting, Powell struck a more dovish tone saying for the first time that the “disinflationary process has started.
The Fed has penciled in two more rate hikes this year followed by a pause with no cuts until 2024.
But CME Group’s FedWatch Tool shows the market pricing in as many as two rate cuts before the end of 2023.