The S&P 500 futures are up 35 points, trading 0.6% above fair value. Nasdaq 100 futures are up 190 points, trading 1.0% above fair value. Dow Jones Industrial Average futures are up 50 points, trading 0.2% above fair value.
There's positive sentiment in early trading, driven by gains in mega-cap and semiconductor stocks. President Biden announced he will not run in the 2024 presidential race and endorsed VP Kamala Harris for the Democratic nomination. The markets have shown little reaction so far.
The 10-year note yield is down two basis points to 4.22%, while the 2-year note yield is up one basis point to 4.52%.
No significant US economic data is expected today.
In corporate news:
- Verizon (VZ, Financial): Reports EPS in-line, revenues in-line; reaffirms FY24 EPS guidance. Stock down 2.7%.
- Truist (TFC): Beats EPS by $0.25, beats on revenues; guides Q3 revenues in-line; guides FY24 revenues above consensus. Stock down 1.7%.
- CrowdStrike (CRWD, Financial): 1600 flights were canceled Saturday due to a global IT outage. Stock down 3.4%.
- Microsoft (MSFT, Financial): Helping customers through the CrowdStrike outage. Stock up 0.7%.
- Walt Disney (DIS): Safra Catz, CEO of Oracle, to leave Disney board of directors. Stock up 0.1%.
- Nvidia (NVDA, Financial): Aims to introduce an AI chip for the Chinese market. Stock up 2.1%.
Reviewing overnight developments:
Today's News
Investors are keenly watching Tesla (TSLA, Financial) as it gears up for its Q2 earnings report on July 23. RBC analyst Tom Narayan noted that there might be a shift in focus from margins and EPS to the company's strategic plans, including updates on the next-generation electric vehicle and the robotaxi concept. Elon Musk has also highlighted the potential of the Optimus humanoid robot business, which aims for low production next year and high production for other companies by 2026.
Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway (BRK.A, BRK.B) sold about 34 million shares of Bank of America (BAC, Financial) for approximately $1.48 billion. Despite this significant sell-off, Berkshire still holds over 998 million shares valued above $42 billion, making it one of the bank's largest shareholders. The transactions were executed between July 17 and 19, with prices ranging from $43.13 to $44.07 per share.
Following a significant outage last week, CrowdStrike (CRWD, Financial) saw nearly a 4% drop in premarket trading on Monday. Research firms Guggenheim and BTIG downgraded the cybersecurity stock, citing potential resistance to new deals due to the quality assurance issue that caused global IT disruptions. The incident particularly affected Microsoft (MSFT, Financial) Windows computers, raising questions about perceived vulnerabilities in the operating system.
Verizon (VZ, Financial) posted mixed Q2 results, with a slight revenue increase of 0.6% year-over-year to $32.8 billion, missing the $33.04 billion estimate. The company's adjusted profit per share was $1.15, in line with analyst expectations. Verizon added 340,000 retail postpaid net subscribers, including 148,000 postpaid phone subscribers, and saw a significant increase in broadband subscribers, reaching 11.5 million by the end of Q2.
Serve Robotics (SERV, Financial) shares surged up to 44% after Nvidia (NVDA, Financial) acquired a stake in the company. Nvidia purchased 1.05 million shares at $2.42 each, totaling over $3.7 million. This acquisition followed Serve Robotics' public listing and was part of a 6% convertible promissory note held by Nvidia.
Bitcoin Depot (BTM, Financial) announced it has surpassed its goal of deploying over 8,000 Bitcoin ATMs, reaching 8,180 kiosks five months ahead of schedule. The company also expanded its operational footprint significantly in the first half of the year.
Johnson & Johnson (JNJ, Financial) submitted a supplemental New Drug Application to the U.S. FDA for Spravato nasal spray as a monotherapy for adults with treatment-resistant depression. Spravato is currently approved in combination with an oral antidepressant for treating adults with TRD and depressive symptoms in those with major depression and acute suicidal ideation or behavior.
