BY THE NUMBERS
Dow futures are signaling a drop of roughly 200 points in the open, following a Federal Reserve press conference that highlighted a difficult economic path ahead. S&P 500 and Nasdaq futures were also negative as Wall Street prepares for new US GDP figures and economic claims, as well as another deluge of corporate earnings. (CNBC)
The anticipated market downturn will cut at least some of July’s gains. But entering today’s session, the top three US indices are solidly higher for the month, with the S&P now posting its best July since 2010 after Wednesday’s 1.24% gain. The Dow added 160.3 points, or .0.69%, while the Nasdaq, heavy on technology, advanced 1.35%.
* Treasury yields fall after the Fed keeps interest rates close to zero (CNBC)
The United States government will release its first look at second-quarter GDP, with consensus forecasts that call for a historic annual rate decrease of 34.7%. The latest initial weekly jobless claims will also be released, expected to top one million for the 19th straight week at 1.45 million.
Today’s earnings schedule has the Dow Procter & Gamble (PG) component, Dunkin ‘Brands (DNKN) and Comcast (CMCSA), the father of NBCUniversal, to be released this morning. The lineup after the bell is busy; Alphabet (GOOGL), Amazon (AMZN), Apple (AAPL) and Facebook (FB) are ready to report, as is Ford Motor Co. (F).
* Comcast Reports Strong Internet Customer Growth, 10 Million Subscriptions for Peacock (CNBC)
* Procter & Gamble sales increase 4% as consumers buy more cleaning products (CNBC)
Coronavirus-related deaths in the US have surpassed 150,000, the latest bleak milestone in the months-long public health crisis that has disrupted American life. The United States has more than 4.4 million confirmed cases of Covid-19, according to a count by Johns Hopkins University.
* Trump says the United States is sending Texas 500 cases of remdesivir when the record for deaths from coronavirus (CNBC)
IN THE NEWS
Fed President Jerome Powell reiterated the central bank’s commitment to use its “full range of tools” as the US economy tries to recover from the impacts of the coronavirus pandemic. Powell’s comments on Wednesday came after the Federal Open Market Committee kept interest rates in a target range close to zero, continuing its accommodative stance on monetary policy. Powell also emphasized that the trajectory of the United States’ economic recovery depends, in large part, on the trajectory of the Covid-19 outbreak. (CNBC)
An email released by the House of Representatives Antitrust Subcommittee offers a window into negotiations between Apple and Amazon as they attempted to bring Amazon’s Prime Video service to the Apple TV set-top box. In the 2016 email, an Apple executive offered Amazon a 15% fee on subscriptions registered through the app, less than the typical 30% fee from the iPhone manufacturer for most purchases on the application. It is unclear whether Amazon and Apple reached an agreement on those terms. But the email suggests that big players may search for better business terms on Apple’s App Store, contradicting Apple’s public stance that all apps are treated equally on its platform. (CNBC)
* Big Tech testifies: Bezos promises action if investigation reveals misuse of seller data, Zuckerberg defends acquisition of Instagram (CNBC)
* 10 questions Jeff Bezos, Sundar Pichai, Mark Zuckerberg and Tim Cook should have asked (USA Today)
House Speaker Nancy Pelosi, a Democrat from California, instituted a mandatory mask policy for the House of Representatives floor after one of its members, Rep. Louie Gohmert, tested positive for Covid-19. The Texas Republican received his positive diagnosis Wednesday in a pre-trip evaluation of a scheduled trip to the Lone Star state with President Donald Trump. Gohmert, who was not involved in the trip, appears to be the eleventh member of Congress to test positive for the coronavirus. Gohmert has been seen on Capitol Hill without a mask. (CNBC)
* Republicans and Democrats are far from reaching a coronavirus relief deal as financial lifelines (CNBC) expire
Quest Diagnostics (DGX) has received approval from the Food and Drug Administration for a coronavirus testing technique that it says will speed up the response time for Covid-19 results, which had slowed in recent weeks as that the US Covid-19 outbreak accelerated in some parts of the country. Quest said the new technique will allow it to process results in two to three days for most patients. It will also increase overall testing capacity, the company said. Public health experts emphasize that significant delays in test results limit the effectiveness of the test because people can pass the virus on to others before they know they are infected. (CNBC)
* Johnson & Johnson begins a human security trial for their Covid-19 vaccine candidate (Reuters)
According to ESPN research, an NBA-sponsored youth development academy in China’s Xinjiang region was plagued by player abuse and was often unable to provide education for players. Since then, the league has closed the academy in Xinjiang, a region in western China where more than a million Muslims have been detained in camps, the United Nations estimates. American coaches who worked at all three NBA development academies briefed league officials on the alleged abuse, ESPN reports, citing unidentified sources. The accusations in history add another layer of complexity to NBA business involvement in China, which for months has been criticized by U.S. lawmakers. (ESPN)
* FBI Director Wray warns of China’s electoral interference (Axios)
Oregon officials and the Trump administration have reached an agreement to reduce the presence of federal agents in Portland after weeks of clashes between protesters and agents. Oregon State Police will maintain a “solid presence” in the state’s largest city under the deal, according to Acting Homeland Security Secretary Chad Wolf. The United States government rated the officers’ presence as necessary to protect the federal court in Portland, which protesters have attacked with stones and fireworks. Critics have denounced the use of tear gas by federal agents and the arrests, arguing that they contributed to the escalation of nightly protests that initially began after the death of George Floyd. (AP)
* Unlikely allies: How Governor Kate Brown and Mike Pence ended up deadlocked in Portland (Oregon Public Broadcasting)
STOCKS TO SEE
Eastman Kodak (KODK) remains on call after the last three sessions, now at $ 33.20 a share compared to last Friday’s close of $ 2.10. The increase followed news that the government was providing a $ 765 million loan for the company’s pharmaceutical ingredient production.
Qualcomm (QCOM) reported adjusted quarterly earnings of 86 cents a share, 15 cents above estimates, and the chipmaker’s revenue also beat Wall Street forecasts. He also gave an optimistic forecast on the sales prospects for his 5G device chips. Separately, it resolved a license dispute with Huawei from China and will receive a payment of $ 1.8 billion during the fiscal fourth quarter.
PayPal (PYPL) earned $ 1.07 adjusted per share for its last quarter, beating the consensus at 19 cents, with the payment services company’s revenue also above expectations. The results were driven by a jump in e-commerce transactions, as well as new accounts.
Yum China (YUMC) beat estimates by 9 cents with an adjusted quarterly profit of 35 cents a share, but the restaurant operator’s revenue was below expectations as a resurgence of the coronavirus in China hurt sales.
ServiceNow (NOW) reported adjusted quarterly earnings of $ 1.23 a share, 22 cents above estimates, with the cloud software company’s earnings slightly above consensus. ServiceNow’s bottom line received a boost from a 30% increase in subscription revenue.
O’Reilly Automotive (ORLY) earned $ 7.10 a share for its last quarter, well above the consensus estimate of $ 4.41, while the auto parts retailer also saw revenue above estimates. The company said it benefited from consumers spending stimulus checks and unemployment benefits by fixing their cars before the lifting of the Covid-19 blocking measures.
Anheuser-Busch InBev (BUD) saw earnings drop 34% in the second quarter as beer volumes fell 17%, but the brewer said it saw a rebound in global beer sales in June.
Archer Daniels Midland (ADM) reported adjusted quarterly earnings of 85 cents a share, well above the consensus estimate of 51 cents, while grain processor revenue also beat Wall Street forecasts. Archer Daniels benefited from record crop exports as countries sought to secure a stable food supply during the pandemic.
WATER COOLER
Tech workers are leaving San Francisco and heading to Lake Tahoe, which is now seeing unprecedented bidding wars, buying activity and price increases. It is another indicator of how the coronavirus pandemic is transforming the American real estate market. “Inventory is getting to the point where we are running out of homes for sale,” according to a Lake Tahoe broker. (CNBC)
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