This week’s top economic event is coming this morning, with the release of the Federal Reserve’s favored inflation gauge. Dell Technologies (DELL) is expected to report a decline in revenue and profit when it releases its results after the closing bell, although details of its Nvidia (NVDA) partnership will be in focus. Snowflake (SNOW) shares are plunging on its CEO’s resignation and disappointing guidance, Salesforce’s (CRM) weak outlook is weighing on its stock, and Bud Light parent Anheuser Busch InBev (BUD) is down after a U.S. revenue slump. Major U.S. stock indexes were pointing lower Thursday morning, while Bitcoin (BTCUSD) is trading near the $63,000 level it hit Wednesday. Here’s what investors need to know today.
1. Fed’s Preferred Inflation Measure Expected to Show Price Pressures Persist
The highly anticipated release today of the Federal Reserve’s favored inflation gauge—the Personal Consumption Expenditures index—is expected to show that inflation accelerated in January, mirroring the signals from the unexpectedly hot Consumer Price Index data released earlier this month. The PCE index likely rose 0.3% in January from December, compared with the 0.2% increase in December, according to a survey of economists by Dow Jones Newswires and the Wall Street Journal. Core inflation, which excludes prices for food and energy, is expected to have risen 0.4%, double the 0.2% increase of December. Fed officials have been saying that they want to see inflation near the central bank’s 2% goal before they will begin to reduce the fed funds rate.
2. Dell Falls Ahead of Forecast Q4 Earnings Decline; AI in Focus
Dell Technologies (DELL) shares were moving lower in premarket trading ahead of 2024 fiscal fourth quarter results due after the closing bell that are expected to show a slump in sales and earnings. Investors will be looking for details of the PC-maker’s partnership with artificial intelligence (AI) darling Nvidia (NVDA). Analysts project Dell’s revenue at $22.11 billion compared with $25.04 billion a year earlier and earnings per share (EPS) at $1.72, down from $1.80, as the company grapples with declines in the PC market.
3. Bitcoin Hovers Near $63,000 Level
Bitcoin (BTCUSD) was slightly below the $63,000 mark it hit Wednesday for the first time since November 2021. Buoying the token is a surge in trading activity of spot bitcoin exchange-traded funds—which have opened up the digital asset to a wider swath of retail investors—as well as an upcoming event called the “halving” that would reduce its supply growth. Shares in Coinbase (COIN), the largest cryptocurrency exchange, meanwhile, were up about 1.5% in premarket trading, after service was restored following an outage Wednesday that was likely caused by the traffic surge, according to CEO Brian Armstrong. The outage left some users seeing zero balance in their accounts and unable to trade as bitcoin kept surging.
4. Snowflake Stock Plunges as CEO Suddenly Retires, Guidance Undershoots
Snowflake (SNOW) shares were more than 20% lower in early trading after the cloud-data firm said chief executive officer (CEO) Frank Slootman was retiring, effective immediately, and issued earnings guidance that fell short of Wall Street expectations. The company named Sridhar Ramaswamy, previously the cloud data company’s senior vice president of AI, as the new CEO. Separately, shares in Salesforce (CRM), another enterprise software firm, were also down as the company’s lower-than-forecast guidance offset its swing to a fourth-quarter profit.
5. Bud Light Slump Takes Toll on AB InBev US Sales
Anheuser-Busch InBev (BUD), the world’s largest brewer, announced a 17.3% drop in fourth-quarter sales in the U.S., hit by declines in sales of Bud Light. The brand lost its spot as the best-selling U.S. beer to Modelo last year after a Budweiser partnership with a transgender influencer sparked a boycott. Overall sales volume for the brewer fell 2.6% in the fourth quarter, which was a steeper decline than analysts had expected. Its American depositary receipts (ADRs) were down about 2% in early trading.
