Stock Market Futures Dip Following Positive Week For Markets
U.S. stock futures are in the red heading into the Memorial Day trading week. Even after ending last week on a high, investors appear to be on the defensive. In the week ahead, there are also numerous tech and retail industry heavy-hitters reporting their latest quarterly figures. This would include the likes of GameStop (NYSE: GME), Chewy (NYSE: CHWY), MongoDB (NASDAQ: MDB), and CrowdStrike (NASDAQ: CRWD) to name a few.
Not to mention there is also a steady stream of economic data due this week. To begin with, the Labor Department’s May jobs report is set for release later on Friday. As it stands, the current consensus estimate from Bloomberg economists is 325,000 jobs added. Should this be the case, it would indicate a deceleration from the prior month’s 428,000 jobs. This alongside the increasing mention of inflationary pressures as a headwind from organizations would influence the overall outlook on the economy.
In fact, some stock market analysts see further turbulence ahead as well. According to Strategas investment strategist Ryan Grabinski, “We could get some sharp snapbacks in stocks that won’t represent a true turning point for the market.” Grabinski also adds, “The building of a bear market is a process, and we could still decline further.” While considering all this, here’s how the major U.S. stock index futures are doing today. As of 5:13 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading lower by 0.26%, 0.25%, and 0.01% respectively.
Paramount’s Top Gun Sets Memorial Day Opening Weekend Record
On the entertainment front, Paramount’s (NASDAQ: PARAA) latest blockbuster release, Top Gun: Maverick, is breaking records in the cinema. Over the three-day Memorial Day weekend, the movie drew $156 million at the box office. This would mark lead actor Tom Cruise’s first $100 million opening weekend. For the most part, this much-awaited sequel comes 36 years after the original. Meanwhile, in international markets, the film added about $124 million despite not showing in China and Russia.
All in all, this would indicate that consumers continue to return to theaters. Because of this, the largest players in the global cinema industry would be gaining attention. Notably, this would include AMC Entertainment (NYSE: AMC), Cinemark (NYSE: CNK), and Imax (NYSE: IMAX). Pair this with the ongoing flurry of streaming content and it seems that the competition for consumer watch hours continues to heat up.
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Bristol-Myers And Novartis Receive Additional FDA Indications For Cancer Medications
In other news, Bristol-Myers Squibb (NYSE: BMY) and Novartis (NYSE: NVS) are coming into focus in the stock market today. Namely, this follows the two companies receiving FDA label expansions for their respective cancer medications. Going into the details, BMY’s Opdivo and Novartis’ Kymriah now have additional indications within cancer. Opdivo, also known as nivolumab, is now a first-line option for the treatment of esophageal squamous cell carcinoma. In brief, the FDA is greenlighting two regimens of Opdivo for the indication.
Additionally, Novartis’ Kymriah received approval for adults with relapsed or refractory follicular lymphoma. Also, it is a third-line option following two systematic treatments. As of this latest regulatory win, Kymriah is now approved for the treatment of three blood cancer types in the U.S. In the larger scheme of things, the overall field of cancer treatment continues to grow and expand.
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Salesforce Earnings Preview: What To Look Out For
Among the key firms reporting earnings today would be Salesforce.com (NYSE: CRM). This giant in the Software-as-a-Service industry will likely be a focus of investors after the closing bell. As it stands, the current consensus figures on Wall Street are an earnings per share of $0.94 on revenue of $7.38 billion for the quarter. This comes at a time when the current trajectory of the enterprise software industry is in question. Because of this, investors could be looking toward Salesforce’s earnings to see how the industry as a whole is doing.
Providing some insight into how Salesforce is doing now is Oppenheimer (NYSE: OPY) analyst Brian Schwartz. He says, “Salesforce is likely experiencing slowing demand, mostly from the macro headwinds but also partly from execution.” Schwarts also notes that this alongside intensifying forex headwinds continues to weigh on Salesforce’s business. In his words, all this “points to good but not great bookings and to Salesforce maintaining its constant-currency guidance.” Regardless, the analyst currently has an Outperform rating on CRM stock. Schwartz argues that the current valuation of CRM stock remains somewhat “reasonable” after considering the company’s free cash flow.
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HP To Report Earnings After The Closing Bell Today
HP (NYSE: HPQ) is another major tech firm posting its latest quarterly financial update today. Overall, the current consensus figures from Wall Street are an earnings per share of $1.05 alongside revenue of $16.19 billion. This would translate to a year-over-year increase of 11% in terms of earnings per share and a 3% year-over-year decline. Nonetheless, following the stellar earnings update from its rival Dell (NYSE: DELL) investors could be keen to see how HP performs.
Regarding analyst opinions on the company. Citi (NYSE: C) analyst Jim Suva recently lowered his rating on HP stock to Neutral from a Buy. Moreover, Suva’s latest update also comes with a price target cut from $40 to $38. According to the analyst, the reason behind this downgrade would be a somewhat mixed performance across HP’s computer hardware portfolio. Despite all this alongside rising freight costs, the firm still notes that HP could likely persist “as a strong operational executor and cash flow generator.”
At the same time, it could also be worth noting that the Oracle of Omaha himself also has a stake in the company. In fact, Warren Buffett’s Berkshire Hathaway (NYSE: BRK.A) is currently the largest shareholder in HP with an 11% stake. This adds up to almost 121 million shares of HP, totaling $4.2 billion in terms of cost. With his value investing strategy in mind, some would be keeping an eye on HP stock today.
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