Stock futures are mixed as investors digest earnings reports and await key inflation data; the September consumer price index report is due to be released this morning; Bank of America, Morgan Stanley and BlackRock each reported results; memory stocks are extending their recent slide amid worries about competition from China; and chip manufacturing equipment giant ASML posted a mixed report. Here’s what you need to know today.
Stock Futures Mixed as Earnings Reports Roll In
Stock futures are mixed on another packed day of earnings reports, while investors brace for inflation data that will factor into the Federal Reserve’s decision on interest rates. Futures tied to the Dow Jones Industrial Average and the S&P 500 were recently up 0.2% and 0.1%, respectively, while tech-heavy Nasdaq futures slipped 0.2%. The major indexes closed slightly lower yesterday as the third-quarter earnings reporting season kicked into high gear. WTI crude oil futures were up nearly 2% at $95.90 per barrel this morning amid continued attacks across the Middle East. Gold futures ticked lower to $4,160 an ounce, while bitcoin was little-changed at $83,500. The yield on the 10-year Treasury, which affects interest rates on consumer loans, was as 5.20%, down from yesterday’s close of 5.22% and last week’s two-decade high of 5.37%.
CPI Report Due To Be Released This Morning
A key inflation report that will affect the Fed’s thinking on interest rates is set for release at 8:30 a.m. ET. The Consumer Price Index data is expected to show that annual inflation accelerated to 3.7% last month, from 3.4% in August. “Core” inflation, which excludes volatile food and fuel prices, is seen coming in at 2.5%, also up from 2.4% in August. Traders are currently pricing in a 22% chance that the Fed will raise its benchmark rate at its policy meeting in two weeks, according to CME Group’s FedWatch tool. A CPI report that comes in hotter than expected could raise those expectations, as inflation remains well above the Fed’s 2% target and officials have stressed their commitment to taming it. The Fed last month hiked its benchmark rate for the first time in three years.
Morgan Stanley, BofA, BlackRock Headline Today’s Earnings Calendar
The first big week of third-quarter results continues today with earnings reports from more big banks. Bank of America (BAC) shares were down nearly 5% in recent premarket trading after the financial services giant missed estimates, with profits dragged lower by a $1.2 billion fine from the Treasury Department, announced last night, over failures to stop criminal activity including money laundering through its systems. BlackRock (BLK) shares were up 3% after the investment management giant topped revenue and adjusted earnings estimates, while its assets under management of $15.5 trillion met estimates. Morgan Stanley (MS) shares were down slightly despite results that topped Wall Street expectations. Results released yesterday from several major banks came in mixed, but executives said they still see things to like in the U.S. economy.
Memory Stocks Extend Skid Amid China Competition Concerns
The memory and data storage trade’s rough week looks set to continue, with many of the sector’s biggest names in the red this morning. Shares of Micron (MU), Sandisk (SNDK), Western Digital (WDC), SK Hynix (SKHY) and Seagate Technology (STX) are all falling this morning. The Roundhill Memory ETF (DRAM) was down 2% ahead of the opening bell after sinking 3% yesterday. The industry has been rattled this week by news that a Chinese chipmaker has allegedly cracked a production method that SK Hynix, Samsung and others have been pursuing for years. The new method would allow the company, CXMT, to produce a smaller chip with the same amount of power. Broader worries about the sustainability of AI financing have also weighed on the chip sector lately.
Chip Equipment Giant ASML Posts Mixed Results
ASML Holding (ASML) posted a mixed report this morning, while lifting the bottom end of its full-year sales forecast. The Dutch maker of semiconductor manufacturing equipment said Wednesday it earned 12.93 euros ($14.47) per share in the third quarter, well above what analysts were looking for, while its sales of 11.66 billion euros ($13.05 billion) narrowly missed the 11.71 billion analysts had expected. ASML’s fourth-quarter sales forecast of 14.2 billion to 15.2 billion euros largely topped the 14.28 billion analyst consensus, and the company narrowed its full-year sales outlook to 44 billion to 45 billion euros, with the lower end raised by 1 billion euros from the prior guide. Shares were down less than 1% premarket.
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