Morning Markets

March S&P 500 futures (ESH23) this morning are down -0.32% and March Nasdaq 100 E-Mini futures (NQH23) are down -0.52%. 

U.S. stock index futures this morning are mildly lower on concern that market expectations may be too optimistic about Q4 tech company earnings.  According to Bloomberg Intelligence data, Q4 earnings for tech firms are projected to drop 9.2% from the same period a year ago, the steepest drop in 7 years. Microsoft will report quarterly earnings after today’s close.

Negative corporate news today is also weighing on stock indexes.  Alphabet is down more than -1% in pre-market trading after Bloomberg reported the U.S. Justice Department could file an antitrust lawsuit against the company as soon as today regarding its dominance over the digital advertising market.  Also, 3M Co is down more than -4% in pre-market trading after reporting weaker-than-expected Q4 adjusted EPS.  In addition, Verizon Communications is down more than -2% after forecasting 2023 EPS below expectations.

On the positive side for stocks, Johnson & Johnson is up more than +2% in pre-market trading after reporting stronger-than-expected Q4 adjusted EPS and forecasting better-than-expected 2023 adjusted EPS.  Also, Haliburton and Raytheon Technologies are up more than +1% after reporting stronger-than-expected Q4 adjusted EPS.

Overseas markets are mixed.  The Euro Stoxx 50 index is down -0.16%, and Japan’s Nikkei Stock index closed up +1.46%.  China and Hong Kong were closed for the Lunar New Year holidays. 

European stocks today are slightly lower as the market braces for quarterly earnings results. Losses in stocks were limited after a Bloomberg report said the German government on Wednesday would revise its 2023 German GDP estimate to show growth of +0.2% versus an October projection of -0.4% contraction.   Also, better-than-expected Eurozone Jan manufacturing news today supported stocks. 

The Eurozone Jan S&P Global manufacturing PMI rose +1.0 to a 5-month high of 48.8, stronger than expectations of 48.5.  Also, the Jan S&P Global composite PMI rose +0.9 to 50.2, stronger than expectations of 49.8 and the strongest pace of expansion in 7 months.

Japan’s Nikkei Stock Index today climbed to a 5-week high and closed moderately higher.  A rally in Japanese chip stocks led the overall market higher today after Barclays Monday upgraded the U.S semiconductor sector. Japanese utility stocks rose today after Tokyo Electric Power is said to be seeking government approval to raise power rates for households by about 30%.  On the negative side, Japanese apparel retailers fell after Shimamura reported January sales figures that showed slower growth.

Pre-Market U.S. Stock Movers

Alphabet (GOOGL) fell more than -1% in pre-market trading after Bloomberg reported the U.S. Justice Department could file an antitrust lawsuit against the company as soon as today regarding its dominance over the digital advertising market.

3M Co (MMM) tumbled more than -4% in pre-market trading after reporting Q4 adjusted EPS of $2.28, weaker than the consensus of $2.36.

Advanced Micro Devices (AMD) slid more than -2% in pre-market trading after Bernstein downgraded the stock to market perform from outperform.

Lululemon Athletica (LULU) slid more than -2% in pre-market trading after Bernstein downgraded the stock to underperform from market perform. 

Verizon Communications (VZ) fell more than -2% in pre-market trading after forecasting 2023 EPS, excluding some items, to be in the range of $4.55-$4.85, below the consensus of $4.97.

Zions Bancorp (ZION) dropped more than -3% in pre-market trading after reporting Q4 total deposits of $71.65 billion, well below the consensus of $75.43 billion. 

Crane Holdings (CR) fell more than -2% in pre-market trading after saying in a conference call that it is “planning for somewhat constrained and mixed activity in 2023 paired with gradual supply chain relief throughout the year.” 

Toast (TOST) dropped more than -3% in pre-market trading after Baird downgraded the stock to neutral from outperform.

Lyft (LYFT) climbed more than +3% in pre-market trading after KeyBanc Capital Markets upgraded the stock to overweight from sector weight.

HighPeak Energy (HPK) surged more than +14% in pre-market trading after the company’s board of directors voted to initiate a process to evaluate strategic alternatives, including a potential sale.

Johnson & Johnson (JNJ) rose more than +2% in pre-market trading after reporting Q4 adjusted EPS of $2.35, better than the consensus of $2.23, and forecast 2023 adjusted EPS of $10.45-$10.65, stronger than the consensus of $10.35.  

Raytheon Technologies (RTX) climbed more than +1% in pre-market trading after reporting Q4 adjusted EPS of $1.27, above the consensus of $1.24.

Haliburton (HAL) rose more than +1% in pre-market trading after reporting Q4 adjusted EPS of 72 cents, better than the consensus of 67 cents.

D.R. Horton (DHI) gained nearly 1% in pre-market trading after reporting Q4 revenue of $7.26 billion, well above the consensus of $6.42 billion.

Today’s U.S. Earnings Reports (1/24/2023)

3M Co (MMM), Capital One Financial Corp (COF), Danaher Corp (DHR), DR Horton Inc (DHI), F5 Inc (FFIV), General Electric Co (GE), Halliburton Co (HAL), Intuitive Surgical Inc (ISRG), Invesco Ltd (IVZ), 

Johnson & Johnson (JNJ), Lockheed Martin Corp (LMT), Microsoft Corp (MSFT), PACCAR Inc (PCAR), 

Raytheon Technologies Corp (RTX), Texas Instruments Inc (TXN), Travelers Cos Inc/The (TRV), Union Pacific Corp (UNP), Verizon Communications Inc (VZ).

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