Here are five things you need to know for Wednesday, October 27:
1. – Futures stocks fall before a busy earnings list
U.S. equity futures fell on Wednesday, putting a two-day streak of record highs at risk as investors brace for another round of blue-chip corporate earnings while tracking a noticeable jump in yields short-term treasury.
Boeing (BA) – Get the Boeing Company Report, McDonalds (MCD) – Get the McDonald’s Corporation (MCD) report, General Motors (DG) – Get the General Motors Company (GM) report and Bristol Meyers (BMJ) – Get Bristol-Myers Squibb Company Report highlight another heavy corporate earnings session on Wednesday, with September trade data expected at 8:30 a.m. EST.
The strength of third-quarter earnings seasons propelled stocks to a series of record highs this month, but growing inflation concerns and uncertainty over Democratic tax proposals – alongside ongoing disruptions in the economy. global supply chain – remain a constant on the bearish side of the market ledger.
Market-based indicators for the short-term inflation outlook are in fact trading at the highest levels in 15 years, while 2-year benchmark bond yields have broken the 0.5% mark in the past. overnight trading for the first time in 19 months as investors reset rate expectations ahead of next month’s Federal Reserve policy meeting.
Still, although Microsoft’s stronger-than-expected September quarter updates (MSFT) – Get the report from Microsoft Corporation (MSFT) and google (GOOGL) – Get the Class A report from Alphabet Inc., along with the momentum of the underlying earnings season, could give stocks some new impetus on Wednesday, with futures indicating a slightly softer open on Wall Street.
Contracts linked to the Dow Jones Industrial Average show an opening bell low of 15 points, while those linked to the S&P 500 are valued for a 6 point pullback. Futures related to the tech-driven Nasdaq Composite show a 22 point slide.
2. – Microsoft exceeds $ 20 billion in profits in the first quarter
Microsoft shares surged higher in pre-market trading after the tech giant posted profits of more than $ 20 billion in the first quarter, fueled in part by soaring demand for its cloud services computing.
Microsoft said revenue from Azure, its flagship cloud division, increased 48% from a year ago, taking the group’s overall revenue to a record $ 45.3 billion for the three months ending in September, Microsoft’s first fiscal quarter. The group’s net profit was also a record, at $ 20.5 billion.
As for the December quarter, Microsoft said cloud revenue could reach around $ 18.2 billion, with gains in personal computing and its business division, but warned that the disruption in the business chain. ‘supply could affect sales of its popular XBox game console.
Microsoft shares were marked 2.32% higher in pre-market trading to indicate an opening bell price of $ 317.30 each.
3. – Pfizer obtains a vaccine for children
Pfizer (PFE) – Get the Pfizer Inc. report shares edged up in pre-market trading after a Food & Drug Administration advisory group recommended its coronavirus vaccine for young children.
The recommendation, which must first be accepted by the FDA and then repeated by the United States Centers for Disease Control and Prevention, could mean that around 28 million children aged 5 to 11 would be eligible to receive the vaccine. two injections from an early age. like next week.
Pfizer, which developed the vaccine alongside its German partner BioNtech, said it could adjust the dose for young children to around 10 micrograms – about a third of the level used for adolescents – while achieving an effectiveness of 90 , 7% against disease.
Pfizer shares were marked 0.23% higher in pre-market trading to indicate an opening bell price of $ 43.66 each.
4. – Democrats unveil the billionaire tax
Senate Democrats on Wednesday unveiled plans for a so-called “billionaire tax,” outlining details of changes in capital gains levies designed to help fund President Joe Biden’s broader social spending plans.
Under the proposal, which faces opposition from both the Senate and the House of Representatives – including Democratic lawmakers – Americans who have owned assets worth at least $ 1 billion for three consecutive years, or who have earned $ 100 million or more for three consecutive years , would pay a capital gains rate of 23.8% even if the assets are not sold.
Sponsored by Senate Finance Committee Chairman Ron Wyden, the tax bill would affect around 700 of the country’s richest people and raise around $ 200 billion over the next ten years.
5. – The fall in Robinhood’s shares
Robinhood Markets (HOOD) – Get the Robinhood Report stocks fell sharply in pre-market trading after the online trading platform posted weaker-than-expected third earnings gains amid slowing retail activity.
Cryptocurrency trading revenue, Robinhood said, fell 78% from the previous quarter to $ 51 million, while equity trading revenue fell 27% from last year. to about $ 50 million. Funded accounts on the group’s platform were nearly double last year’s level, at 22.4%, but were broadly flat compared to the three months ending in June.
“Looking back at the second quarter, we saw a huge interest in crypto, especially the doge, which has led to a large number of new clients joining the platform and record revenues,” said the co-founder. and CEO Vlad Tenev to investors in a conference call Tuesday night. “In the third quarter, crypto activity reached record levels, resulting in fewer new funded accounts and lower revenues.”
Robinhood shares fell 10.8% in pre-market trading to indicate an opening bell price of $ 35.30 – nearly $ 3 below its IPO price in July.