5 Things to Know Before the Stock Market Opens

U.S. stock futures are lower as indexes step back from record highs and Treasury yields move higher; General Motors (GM) and GE Aerospace (GE) beat third-quarter earnings estimates; Nvidia (NVDA) is close to eclipsing Apple’s (AAPL) market capitalization; and Cheesecake Factory (CAKE) shares are rising on a report an activist investor is urging the restaurant chain to break up. Here’s what investors need to know today.

1. US Stock Futures Lower as Indexes Step Back From Recent Highs

U.S. stock futures are lower Tuesday, a day after major indexes closed mixed. Coming off a six-week winning streak and record closing highs on Friday, the Dow Jones Industrial Average and S&P 500 moved lower on Monday, while the Nasdaq gained ground. Meanwhile, Treasury yields have hit their highest levels since July as investors factor in slower expectations of interest-rate cuts. The yield on the 10-year Treasury rose to 4.19% on Monday, an increase of 11 basis points, to deliver the biggest intraday rise since Oct. 4.

2. GM Results Top Estimates

Automaker General Motors (GM) beat analysts’ expectations with its third-quarter earnings report Tuesday morning. The Cadillac and Chevrolet maker reported revenue of $48.76 billion, better than the consensus estimate of $45.02 billion from analysts polled by Visible Alpha, while its profit of $3.06 billion topped projections of $2.59 billion. GM also raised the lower end of its full-year adjusted earnings per share (EPS) guidance to $10.00 to $10.50, up from the prior guidance of $9.50 to $10.50. Shares of GM are about 1% lower in premarket trading.

3. GE Aerospace Earnings Surpass Expectations

GE Aerospace (GE) delivered third-quarter earnings that were better than analysts’ expectations as the company reported strong demand for its airplane engines and parts. The company’s revenue of $9.84 billion was above the projection of $9.55 billion from analysts polled by Visible Alpha, while its net income of $1.89 billion, or $1.56 per share, topped the projected $1.28 billion and $1.19. The aerospace manufacturer also also lifted its profit projections for full-year 2024, guiding adjusted earnings per share (EPS) to a range of $4.20 to $4.35, up from $3.95 to $4.20 previously. Still, shares are declining more than 5% in premarket trading as commercial engines revenue came in a bit short of expectations.

4. Nvidia Approaching Apple’s Market Cap

Nvidia (NVDA) shares are inching higher in premarket trading after the chipmaker hit another all-time high on Monday of $143.71 as analysts continued to project upward momentum for the company’s artificial intelligence (AI) products. Bank of America named Nvidia a “top AI pick” and moved the company’s price target to $190 from $165. The rise puts Nvidia’s market capitalization around $3.5 trillion as it gains on Apple (AAPL) to become the world’s largest corporation. Apple’s market capitalization is near $3.6 trillion and its shares are lower by 0.7% in premarket trading.

5. Activist Investor Reportedly Urges Cheesecake Factory to Break Up

Activist investor JCP Investment Management has taken a position in The Cheesecake Factory (CAKE) and is urging the company to break up, according to a report in The Wall Street Journal. The Houston-based hedge fund took a 2% stake in Cheesecake Factory, the report said, and is urging executives at the company to spin off restaurant chains North Italia, Flower Child, and Culinary Dropout. Shares of Cheesecake Factory are rising nearly 4% in premarket trading.

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