Here are the top news, trends, and analysis investors need to start their trading day:
1. Futures fell after hot inflation, strong bank profits
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, USA on July 12, 2021.
Brendan McDermid | Reuters
US stock futures fell lower on Tuesday as earnings season began and hot inflation data came the day after the record highs for the Dow Jones Industrial Average, S&P 500, and Nasdaq. All major benchmarks were in full swing, with the Dow up seven of the last eight sessions, the S&P 500 up 10 out of 12 sessions, and the Nasdaq up eight out of the last 10 sessions. The S&P 500 leads the three with a year-to-date gain of 16.7%. The Dow and Nasdaq are up around 14.3% for 2021.
The 10-year government bond yield rose to around 1.38% on Tuesday after falling to 1.25% last Thursday. The move in yields came after the government announced that its consumer price index rose 0.9% in both headline and core non-food and energy stocks in June. That was almost double the expectations. The year-over-year numbers were better than expected, rising 5.4% on the main CPI, the fastest pace in nearly 13 years; the core rate rose 4.5%, the strongest move since September 1991.
2. JPMorgan, Goldman Sachs Quarterly Results Exceed Expectations
The headquarters of JP Morgan Chase & Co., the JP Morgan Chase Tower on Park Avenue, Midtown, Manhattan, New York.
Tim Clayton – Corbis | Corbis Sport | Getty Images
JPMorgan’s shares fell nearly 0.2% in Tuesday’s pre-trading session after the bank posted second-quarter earnings and earnings that exceeded expectations as the company released funds for loan losses. Borrowers have held up better than expected as the economy continued to pull itself out of the downturn in the Covid pandemic.
Goldman Sachs stocks rose 1% in early trading after the bank’s earnings report for the second quarter beat Wall Street estimates, fueled by strong investment banking performance during this year’s robust IPO market.
3. PepsiCo raises guidance after lowering earnings estimates
Bottles of PepsiCo Inc. brand Pepsi Soda for sale in a grocery store in Baghdad, Kentucky, the United States, on Friday, April 9, 2021.
Luke Sharrett | Bloomberg | Getty Images
PepsiCo shares rose more than 1% in the premarket after the drinks and snacks company reported that its quarterly sales were up more than 20% year over year as restaurant demand for its beverages returned, causing a blow to profits. PepsiCo also raised its outlook for adjusted earnings per share growth for the full year. “Many of the things that we did during the pandemic and continued to invest in business are now paying off as mobility has increased and consumers are coming out more,” CFO Hugh Johnston said in the Squawk Box on Tuesday CNBC.
4. Boeing reduces 787 Dreamliner production and delivery targets
An employee works on the tail of a Boeing Co. Dreamliner 787 aircraft on the production line at the company’s final assembly facility in North Charleston, South Carolina.
Travis Dove | Bloomberg | Getty Images
Boeing shares fell 2% in the premarket after the aircraft maker announced Tuesday morning that it was lowering its delivery target for its undelivered 787 Dreamliners. Boeing announced that it would temporarily cut production rates after discovering a new defect on some wide-body jets. Boeing said it will ship fewer than half of the Dreamliners it has already produced but not yet shipped to customers. CEO Dave Calhoun said at an investor conference last month that the company would deliver the “lion’s share” of the approximately 100 Dreamliners in its portfolio this year.
5. FDA announces new warning on J&J Covid vaccine, the report said
A healthcare doctor prepares a dose of the Johnson & Johnson Coronavirus Disease (COVID-19) vaccine for a commuter during the opening of MTA’s public vaccination program on the 179th Street subway station in the Queens borough of New York City in front. USA, May 12, 2021.
Shannon Stapleton | Reuters
The Food and Drug Administration is expected to announce a new warning for Johnson & Johnson’s Covid-19 vaccine stating the shot has been linked to a serious but rare autoimmune disease, the Washington Post reported Monday citing four unnamed sources. About 100 preliminary reports of Guillain-Barre syndrome were discovered after 12.8 million doses of J & J’s single-use vaccine were administered, the Centers for Disease Control and Prevention said in a statement to NBC News. Guillain-Barre is a rare neurological disorder in which the body’s immune system mistakenly attacks part of the nervous system.
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