Stock Futures Moving Sideways Despite Delta Variant Risks
The U.S. stock futures are flat in pre-market trading on Tuesday as investors prepare themselves for another busy earnings day. This week will undoubtedly be another week packed with corporate earnings to watch alongside the inflation data set to be announced tomorrow. Among other things, there are also renewed concerns over reinstated travel restrictions in China due to the coronavirus infections.
“I think a lot of the fears around the Delta variant, in particular, are a bit overblown. Although I think investors are grappling with the Delta variant and treating that as a primary brick in the so-called ‘wall of worry,’ I don’t think it’s something that derails the longer-term view.”- Elyse Ausenbaugh, JPMorgan Private Bank global market strategist
Investors have also been trying to appraise the extent of the growth slowdown that might be the result of the highly transmissive variant. Reopening stocks such as Norwegian Cruise Lines (NYSE: NCLH) and United Airlines (NASDAQ: UAL) were also feeling the heat at the start of the week. The Dow and S&P 500 futures are trading in the negative territory, moving 0.06% and 0.01% lower respectively as of 6:44 a.m. ET. Meanwhile, Nasdaq futures are edging up by 0.11%.
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AMC Entertainment (AMC) Stocks Pop Following Earnings
AMC Entertainment (NYSE: AMC) stock is surging higher in its pre-market trading today. This came after the company announced a better-than-feared earnings report. Its revenue also topped Wall Street’s estimates. For those who are new to the stock market, AMC stock has rallied nearly 1,500% this year. This came after the Reddit army managed to create a short squeeze in the shares.
“AMC’s journey through this pandemic is not finished, and we are not yet out of the woods,” CEO Adam Aron said in a statement Monday. “However, while there are no guarantees as to what the future will bring in a still infection-impacted world, one can look ahead and envision a happy Hollywood ending to this story.”
More interestingly, the movie theater chain also said it will start accepting bitcoin as payment for movie tickets and concessions. The move marks a marriage of two highly speculative assets. Should the plan go accordingly, we could be able to purchase our movie tickets at AMC with bitcoin by the end of the year.
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Coinbase Stock Rises Ahead Of Tuesday’s Earnings Report
Rising prices for Bitcoin and Ethereum are prompting big gains among crypto stocks in the stock market today. It goes without saying that strong pricing momentum among cryptocurrencies will typically drive valuations for crypto-related stocks higher. Coinbase Global (NASDAQ: COIN) is one of the fintech companies benefitting from the crypto rally. It will be reporting second-quarter earnings after the market closes today.
Now, Coinbase stocks may have fallen from their initial IPO price. But many are optimistic that this will be a blowout quarter for the crypto trading platform. That is despite major cryptos taking a breather just a few months ago. “I think their user growth is going to exceed verified users of 60 million, and I think that’s going to be sort of a benchmark that they’re going to continue to feed on. Trading activities where they get paid as well. I think that’s going to pick up,” – Bill Baruch, Founder and President of Blue Line Capital
Meanwhile, China-based mining specialists such as Canaan (NASDAQ: CAN) and Ebang (NASDAQ: EBON) are also benefiting from the crypto rally. Of course, the gains over the weekend could help spur rallies for fintech stocks. But investors should also know that the broader crypto space remains prone to high levels of volatility. With that in mind, would you be watching these crypto stocks today?
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Unity Is a Huge Pick-and-Shovel Play On The Gaming Industry
Unity Software (NYSE: U) is another highly anticipated gaming stock set to release its quarterly earnings after the market closes today. For those unfamiliar, Unity doesn’t make games. Instead, it licenses software that developers and content creators use to build games. The pick and shovel company also has analytical tools, an advertising placement platform, and an in-app marketplace to offer to its customers. These enable customers to maximize the economic potential of the content they create with Unity’s tools.
Many are aware of Unity’s extensive market reach, especially in the gaming space. Its business model is certainly working, judging on Unity’s past sales growth. Recall when Unity reported its first-quarter results in May. CEO John Riccitiello pointed out that the 41% revenue growth in the quarter marked the tenth straight quarter of 30%-plus sales growth. But as impressive as those numbers were, Unity stock did not fully live up to expectations.
Yes, there may be some growth stocks pulling back this year. And Unity stock is one of the casualties. However, with its consistent track record of pulling in significant growth every quarter, investors might want to pay closer attention to its long-term prospects. After all, Unity already has more than 50% market share in mobile gaming. That said, once the virtual reality or augmented reality applications go mainstream, Unity stock could deliver handsome returns to its investors. With U stock moving sideways since the drop earlier this year, could there be an opportunity for bargain hunters?
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More Earnings Underway
Today is yet another busy day on the earnings front with multiple companies reporting their quarterly results. It’s noteworthy that most of the earnings reported so far have topped estimates. This shows us that there will always be a silver lining in a heavily battered economic environment. Some of the notable names reporting this morning include Exela (NASDAQ: XELA), Casper (NYSE: CSPR), and Aramark (NYSE: ARMK).
There are also major companies reporting earnings after the closing bell today. They include fuboTV (NYSE: FUBO), Coinbase, PubMatic (NASDAQ: PUBM), Upstart (NASDAQ: UPST), and McAfee (NASDAQ: MCFE). So, whether it is waiting for the final vote in the Senate, or simply following the earnings reports, there should be enough to occupy your day.
