What to watch today: Wall Street set for a mixed open after more recordsAugust 26, 2020
S&P 500 and Nasdaq futures were pointing to gains at Wednesday's open, one day after both indexes closed at records again. Dow futures were pointing to an opening loss following Tuesday's modest decline. The S&P 500 and Nasdaq are closing the gap on the Dow Jones Industrial Average in terms of August performance, with the S&P 500 up 5.3%, the Nasdaq up 6.7% and the Dow up 6.9% for the month. (CNBC)
Mortgage applications to purchase a home rose 0.4% last week from the previous week but were a remarkable 33% higher than the same week a year ago. According to the Mortgage Bankers Association's index, refinancing demand fell 10% last week but was up 34% annually. (CNBC)
* July durable goods orders jumped 11.2%, far exceeding estimates (Reuters)
Kansas City Federal Reserve President Esther George said, in an interview that ran on CNBC on Wednesday morning, that the recession that began in February could revisit the economy if the coronavirus pandemic intensifies. She also said, "I'm not an advocate of letting inflation run hot, because I'm not sure what people mean by that."
Newly announced Dow-30 stock Salesforce was surging 13% in Wednesday's premarket, the morning after the business software company more than doubled estimates with adjusted second-quarter earnings of $1.44 per share. Revenue rose 29% to $5.15 billion, which also exceeded forecasts. Salesforce raised full-year guidance, crediting increases in work-from-home and e-commerce during the coronavirus pandemic. Salesforce replaces Exxon Mobil in the Dow industrials on Monday. (CNBC)
Urban Outfitters shares were jumping about 16% in the premarket after the apparel retailer late Tuesday surprised analysts expecting a loss by reporting an adjusted second-quarter profit of 35 cents per share. The company behind the Urban Outfitters, Anthropologie and Free People benefited from an increase in digital sales. However, total revenue of $803 million dropped 16.5% for the quarter. (CNBC)
Shares of Dick's Sporting Goods were rising about 11% in the premarket after the company reported remarkable second-quarter earnings and sales growth Wednesday morning. Digital sales surged 194% as consumers flocked to the Dick's website for hiking gear, kayaks, weights and workout clothes to stay busy during the coronavirus crisis. (CNBC)
* Nordstrom's sales fall 53% as department store chain suffers pandemic store closures (CNBC)
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IN THE NEWS TODAY
Vice President Mike Pence delivers the marquee speech Wednesday night, on the third day of the Republican National Convention, making the case for another four years for President Donald Trump and laying the foundation for his own potential White House run in 2024. On Day 2, first lady Melania Trump, speaking in the newly renovated White House Rose Garden, offered condolences for those who died or are struggling from the coronavirus. (CNBC)
According to a new CNBC/Change Research poll, conducted before the GOP convention, serious concerns about the coronavirus dropped in six 2020 swing states, while approval of the president's handling of the crisis rose. Despite the shifts, Trump still trailed Democrat Joe Biden in the poll in battleground states of Arizona, Florida, Michigan, North Carolina, Pennsylvania and Wisconsin. Likely voters narrowly said that Biden would do a better job handling the pandemic.
* Fewer voters say they're voting by mail amid uproar over USPS changes, CNBC's poll finds
The Centers for Disease Control and Prevention has modified its guidelines for Covid-19 testing. The CDC site changed Monday, now saying, "If you have been in close contact (within 6 feet) of a person with a COVID-19 infection for at least 15 minutes but do not have symptoms … you do not necessarily need a test unless you are a vulnerable individual or your health care provider or State or local public health officials recommend you take one."
Epidemiologists credit a more unified national health message for the downward trend in new daily coronavirus cases in the U.S. They also said that keeping some businesses closed helped slow the outbreak. Daily new cases, which peaked on July 16 at over 77,000, were around 38,000 on Tuesday. (CNBC & JHU)
Three reported cases of Covid-19 reinfections look like "outliers" compared with the millions who have been infected, a World Health Organization official said Wednesday. Two patients in Europe and one in Hong Kong were confirmed to have been reinfected with a different strain of the virus, according to Reuters.
Data analytics company Palantir Technologies has released its prospectus to debut on public markets. Rather than sell shares through an initial public offering, the company plans a direct listing. According to the filing, Palantir lost $588 million last year. (CNBC)
* Palantir CEO Alex Karp rips Silicon Valley in letter to investors (CNBC)
Desktop Metal agreed to go public through a reverse merger with blank-check company Trine Acquisition (TRNE), in a deal that values the 3D printing technology provider at $2.5 billion. Desktop Metal founder and CEO Ric Fulop told CNBC on Wednesday "the pandemic changes the way you do things" and that's why the company didn't go the tradition IPO route.
* Ex-Trump adviser Gary Cohn seeks $600 million for blank-check company IPO (Reuters)
* New blank-check company from Bancorp founder lays groundwork for a fintech deal (CNBC)
McDonald's (MCD) said its investigation into misconduct claims within the company now included whether its former chief executive, Steve Easterbrook, may have covered up inappropriate actions by other executives during his tenure. The company also said it was examining the actions of its human resources department. (NY Times)
* Etsy CEO says Amazon is trying to ‘wipe out its competitors’ by backing California consumer protection bill (CNBC)
The National Hurricane Center expects rapidly intensifying Hurricane Laura to become a catastrophic Category 4 storm, bringing life threatening storm surge, extreme winds and flash flooding over eastern Texas and Louisiana later Wednesday. Through Friday, rainfall totals from Laura are expected in a range of 5 to 10 inches. Much of the U.S. energy operations along the Gulf Coast has been shut down, with nearly 300 oil platforms evacuated. (AP)
STOCKS TO WATCH
Jefferies raised its price target on Tesla (TSLA) to a Wall Street-high pre-split $2,500 per share from $1,200, saying it's still early in the "transformation" of the auto industry but expects Tesla to keep challenging its peers.
Wedbush raised its price target on Apple (AAPL) to a Wall Street-high $600 per share on a pre-split basis from $515 on expectations of what it calls an iPhone 12 "supercycle." Wedbush maintained its outperform rating.
Toll Brothers (TOL) beat estimates by 19 cents a share, with quarterly earnings of 90 cents per share. The luxury home builder's revenue also exceeded consensus. Orders surged more than 26% during the quarter, and Toll also gave an upbeat forecast for home deliveries during the current quarter.
Hewlett Packard Enterprise (HPE) reported quarterly earnings of 32 cents per share, 9 cents a share above estimates. Revenue beat Wall Street forecasts as well. The enterprise computing company also resumed forward guidance, giving a better-than-expected forecast for the current quarter and the full year.
Intuit (INTU) reported quarterly profit of $1.81 per share, beating the consensus estimate of $1.05 a share. The financial software company's revenue also above Wall Street forecasts. The maker of TurboTax, QuickBooks and Mint saw an 83% sales surge, with activity picking up following the completion of a delayed tax season.
The Justice Department charged Teva Pharmaceutical (TEVA) of conspiring with other pharma companies to raise prices for generic drugs. Reuters reports that the charges came after Teva refused a settlement that would have required it to admit wrongdoing and pay a penalty. Teva said it firmly rejects the allegations and will vigorously defend itself in court.
Bed Bath & Beyond (BBBY) will cut about 2,800 jobs as part of a restructuring, in a move that the housewares retailer expects will save about $150 million per year.
Carnival's (CCL) Princess Cruises unit canceled cruises scheduled for early 2021 for two of its ships, the Island Princess and Pacific Princess, citing Covid-19 related restrictions. This comes a day after Carnival's Cunard brand extended cancellations for that line's cruises through mid-May 2021.
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