The S&P 500 futures are up 12 points (0.2% above fair value), Nasdaq 100 futures are up 70 points (0.3% above fair value), and Dow Jones Industrial Average futures are up 32 points (0.1% above fair value).
Stock futures suggest a higher open after record finishes for major indices yesterday. Gains in big names are pushing the market up. Investors are waiting for inflation data this week and Fed Chair Powell's testimony to Congress starting today.
Today's only economic data is the NFIB Small Business Optimism Survey, which rose to 91.5 in June from 90.5.
Treasury yields are slightly up. The 10-year note yield is up three basis points to 4.30%, and the 2-year note yield is up two basis points to 4.64%.
In corporate news:
- NVIDIA (NVDA, Financial) 130.08, +1.88, +1.5%: KeyBanc raised the price target to $180 from $130.
- Disney (DIS) 97.47, +0.10, +0.1%: Plans to introduce a new China cruise ship, according to Reuters.
- KKR (KKR) 105.48, +0.41, +0.4%: Aims to lower its stake in Kokusai Electric, according to Reuters.
- Netflix (NFLX) 688.10, +2.36, +0.3%: TD Cowen raised the price target to $778 from $725.
- Bank of America (BAC, Financial) 40.87, +0.25, +0.6%: Upgraded to Neutral from Underweight at Piper Sandler.
Reviewing overnight developments:
Today's News
The Federal Reserve is reportedly considering a rule change that could reduce the reserve requirements for the U.S.'s eight largest banks, potentially saving them billions of dollars. This change would affect the GSIB surcharge, introduced in 2015 following the 2008 financial crisis. The banks impacted include JPMorgan Chase (JPM, Financial), Citigroup (C, Financial), Bank of America (BAC, Financial), Goldman Sachs (GS, Financial), Morgan Stanley (MS, Financial), Wells Fargo (WFC, Financial), BNY Mellon (BK, Financial), and State Street (STT, Financial).
Several semiconductor stocks, including Nvidia (NVDA, Financial), AMD (AMD, Financial), and Micron (MU, Financial), were in focus as KeyBanc Capital Markets provided a mixed outlook on the industry. While the analog space is struggling due to the automotive sector's ongoing correction, the traditional server market is recovering, and demand for generative AI remains robust. KeyBanc raised its price targets for Nvidia, Micron, and Marvell (MRVL) while lowering estimates for On Semiconductor (ON) and Lattice Semiconductor (LSCC).
Occidental Petroleum (OXY) announced that its 1PointFive carbon capture unit entered into an agreement with Microsoft (MSFT, Financial) to sell 500K metric tons of carbon dioxide removal credits over six years. This deal, the largest of its kind to date, supports Microsoft's goal of becoming carbon negative by 2030. The captured carbon dioxide will be stored securely through subsurface saline sequestration.
Indivior (INDV) saw its shares drop significantly after the company lowered its FY 2024 financial outlook due to sales headwinds related to its opioid use disorder drug, Sublocade. Additionally, Indivior decided to discontinue sales and marketing of its schizophrenia therapy, Perseris, resulting in a headcount reduction of approximately 130 employees. The company also updated its Q2 2024 net revenue outlook to reflect adverse sales conditions.
Microsoft (MSFT, Financial) was highlighted as Argus raised its price target on the tech giant, citing its significant investments in generative AI. The firm expects Microsoft to maintain its premier position in business software technology through its AI and cloud investments. Argus boosted its price target to $526 from $475, maintaining a Buy rating on the stock.
Lucid Group (LCID) announced a recall of approximately 12,757 vehicles due to a software error and a coolant heater issue. Despite this, the stock had recently jumped following a positive Q2 deliveries report, where the company produced 2,110 vehicles and delivered 2,394 vehicles, exceeding expectations.
Pfizer (PFE) announced that its Chief Scientific Officer and President of R&D, Mikael Dolsten, will leave the company after more than 15 years of service. Pfizer is launching an external search to find a successor, expected to conclude early next year. Dolsten played a key role in securing approvals for over 35 drugs and vaccines, including the Comirnaty COVID-19 shot developed with BioNTech (BNTX).
Chewy (CHWY) shares were under pressure as Argus downgraded the stock, citing concerns over the economic landscape and a decline in the active customer list. Despite strong long-term fundamentals, Argus is wary of the company's immediate outlook amid weak economic conditions and substantial investment spending for expansion into Canada.
Samsung Electronics (SSNLF) will introduce a new health-tracking feature in its Galaxy Watch models at the Galaxy Unpacked event. The feature tracks the Advanced Glycation End Products (AGEs) index, providing insights into metabolic health and biological age. This new offering aims to compete with Apple's (AAPL) health-tracking capabilities and other premium products.
UiPath (PATH) announced a reduction of approximately 10% of its global workforce as part of a restructuring effort to manage operating expenses. The company expects to incur total restructuring costs between $17M and $25M, with most reductions completed by the end of Q1 2026.
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