Stock Market Futures Ticked Higher Amid Omicron & Tapering Uncertainties
U.S. stock futures edged higher in early morning trading on Thursday as investors grappled with uncertainty surrounding the Omicron variant. The stock market tumbled on Wednesday after the CDC confirmed the first known case of the Omicron variant in the U.S. In addition to that, investors are also increasingly cautious about the likelihood of faster tapering. That in turn sets the stage for more, and faster interest rate hikes.
“It is not about Covid; it is about the Fed and what they plan to do. This selling will grow much worse; this will become about how much pain the Fed can endure,”– Michael Kramer, Chief Executive Officer at Mott Capital Management.
On the economic data front, we have the weekly initial jobless data coming in at 8.30 a.m. ET. Economists are expecting a print of 240,000, according to estimates from Dow Jones. The prior reading showed 199,000 first-time filers, which was the lowest since November 1969. As of a 7:44 a.m. ET, the Dow and S&P 500 futures are rising this morning, while Nasdaq futures have moved lower 0.35%, 0.06%, and 0.38% respectively.
Will Grab’s Public Debut Sizzle Or Fizzle In Stock Market Today?
Today, Singapore-based ride-hailing company Grab (NASDAQ: GRAB) is going public following the completion of its merger with special purpose acquisition company (SPAC) Altimeter Growth (NASDAQ: AGC). In a year full of SPAC deals, this may be the largest ever. For those unfamiliar, Grab is Southeast Asia’s largest ride-hailing and food delivery company, and the region’s most valuable startup. Anyone that is looking to catch the next Uber (NYSE: UBER) might see some value in Grab.
Altimeter founder and CEO Brad Gerstner proudly declared that Grab is “paving the digital path forward for the 670 million citizens of Southeast Asia”. The potential addressable market we are looking at here is somewhere between Uber’s primary U.S. market and Didi’s (NYSE: DIDI) Chinese market. With an emerging middle class in this region, there are reasons to be hopeful about Grab’s potential.
However, before you jump straight at it, it’s worth noting that not everything has been smooth-sailing for the company. Like its industry peers, Grab has seen some of its growth taper due to the continued Covid-19 spikes in Southeast Asia. And that only pulls Grab away from profitability, rather than toward it. What’s more, with the new variant now wreaking havoc in the stock market, it’s highly unlikely that GRAB stock will skyrocket right out of the gate. Now, don’t get me wrong, I’m not saying it’s a bad stock. But before we have more details on the Omicron variant and how it would affect the reopening of economies, I would prefer to stay on the sideline for now.
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Qualcomm Jumps Into Hot Gaming Market With New Chip For Portable Game Consoles
From powering everything from fridges to cars and anything you can possibly imagine, there’s no question that Qualcomm (NASDAQ: QCOM) has made all of this possible. Now, the semiconductor company is upping its investment in gaming. It unveiled a new Snapdragon G3x microchip on Wednesday for handheld consoles. It is also partnering with gaming hardware company Razer to make the Snapdragon G3x Handheld Developer Kit. This is an Android-based platform designed to let you play Android games, stream games from a console or PC, or play games via cloud gaming services.
For starters, the handheld runs on the G3x chip and has a 6.65-inch OLED screen that supports 120Hz refresh rates. It also has a 5MP webcam on the front so that players can livestream their faces while playing a game. For some, Qualcomm’s recent movement is understandable as its competitors such as Advanced Micro Devices (NASDAQ: AMD) and Nvidia (NASDAQ: NVDA) are seeing huge growth in this high growth area.
‘“Razer is extremely excited to partner with Qualcomm Technologies and support them on their way to introduce new cutting-edge technology to the global gaming industry,” says Min-Liang Tan, Razer co-founder and CEO. “Together, Qualcomm Technologies and Razer will lead the way with new and innovative solutions that push the boundaries of fidelity and quality available in portable gaming, transforming the way these games are experienced.”
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DocuSign (DOCU) Earnings In Focus After Strong Earnings Week For Software Companies
Pandemic darling DocuSign (NASDAQ: DOCU) will be announcing its third-quarter earnings after the closing bell today. Investors are heading to today’s earnings report with high expectations. After all, the company has been in a great position to capitalize on. To provide some context, DOCU stock has surged more than 200% since the beginning of last year. And investors are now wondering if the momentum could continue. Besides, strong earnings from Snowflake (NYSE: SNOW) and Crowdstrike (NASDAQ: CWRD) could also be lifting investors’ expectation toward work-from-home stocks.
For the third quarter, analysts estimate that Docusign will likely report an earnings per share of $0.46. The consensus revenue estimate stands at $531.25M. The bulls will hope to hear that the company not only announce an earnings beat. What’s more, they want to see a positive guidance for the upcoming quarter. The outlook for DocuSign actually looks positive. Here’s why.
The remote and hybrid working trend is likely to continue in the coming quarters. This comes as the discovery of Omicron prompts fears of renewed lockdowns and travel restrictions. And that could drive demand for DocuSign’s software tools which help organizations sign and manage agreements digitally, instead of physically. If anything, it seems to me that DocuSign is shaping up to be a great long-term investment in the stock market today.
Earnings On Tap In The Stock Market Today
While the third quarter earnings are largely in the rearview mirror, there are still plenty of earnings to consider today. Before the market opens, we have retailers such as Dollar General (NYSE: DG), Signet Jewelers (NYSE: SIG), and Kroger (NYSE: KR) reporting their earnings.
Alternatively, there are also notable names reporting their earnings after today’s closing bell. This is evident as DocuSign, Marvell Technology (NASDAQ: MRVL), Asana (NYSE: ASAN), Smith & Wesson Brands (NASDAQ: SWBI), and Tilly’s (NYSE: TLYS) are reporting their earnings during after-market hours. So, whether it is Grab’s first day of public market debut, Qualcomm’s new chip in the gaming space, or simply the barrack of earnings, there are a lot to consider amidst the heightened volatility in the stock market today.
