Stock Market Futures Gain As Markets Look To Extend Recovery Rally
U.S. stock futures are trading higher ahead of the opening bell on Friday this week. Notably, it seems like markets are extending yesterday’s recovery rally efforts. This movement follows months of volatility and uncertainty regarding the current state of inflation in the U.S. economy. The likes of which remain a key focus for Federal Reserve chair Jerome Powell and team. Over the past two days, Powell has and continues to reaffirm that the Fed is “strongly committed” to addressing inflation. In doing so, he also notes that a soft landing by the Fed would be challenging given the current circumstances. As such, the question now would be whether this rebound in the stock market can hold for long.
Weighing in on the situation now is Ed Moya, a senior market analyst from Oanda. He begins by noting, “Recession talk remains the focal point on Wall Street and that means whatever stock market rebounds emerge will probably be short-lived.” Moya also adds, “Wall Street won’t have any answers anytime soon for the questions on when will inflation peak, how soon will we see a recession, and how high will the Fed raise rates?” As investors continue to ponder all of this, there is plenty of stock market news to take note of today as well. As of 5:05 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading higher by 0.52%, 0.62%, and 0.82% respectively.
FedEx Raises Fiscal Year Guidance As It Prioritizes Profit-Boosting Deliveries
FedEx (NYSE: FDX) seems to be hard at work optimizing its operations now. For the most part, this is apparent from its latest quarterly financial update. Diving in, the logistics industry titan posted commendable figures in its fourth fiscal quarter report after yesterday’s closing bell. According to the press release, FedEx’s total earnings per share for the quarter is $6.87. Furthermore, the company’s total quarterly revenue is $24.4 billion. Throughout the fiscal year 2022, FedEx also highlights that it repurchased $2.2 billion of its common stock. As of May 31, 2022, there is $4.1 billion remaining under its current share repurchase program. Of which, FedEx expects to employ $1.5 billion for stock buybacks through the first half of its fiscal 2023.
Providing an overview of the company’s latest quarterly performance is CEO Raj Subramaniam. He says, “Our fiscal 2022 financial performance was a result of our team’s ability to adapt to a number of unexpected challenges and is a testament to the FedEx value proposition and the execution of our long-term strategy.” Looking forward, Subramaniam continues, “Our foundational investments have set the stage for a strong fiscal 2023. As we move forward, our focus will be on revenue quality and lowering our cost to serve.” Overall, it seems like FedEx continues to press forward and is keen on building its momentum further.
Also in the company’s earnings report, FedEx is anticipating a full-year earnings per share of between $22.50 to $24.50 for its fiscal 2023. For reference, this would be noticeably above consensus Wall Street forecasts of $22.14. All in all, with FedEx firing on all cylinders, FDX stock would be gaining attention later today.
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Zendesk Stock In The Spotlight Following Mentions Of Potential Takeover From PE Consortium
Another firm making waves in the stock market now would be Zendesk (NYSE: ZEN). On the whole, the customer relationship management (CRM) software firm is likely gaining from mentions of a potential takeover. According to a report from the Wall Street Journal (WSJ), Zendesk may be nearing an agreement with a consortium of private equity firms. Among the firms named are Hellman & Friedman & Permira. For one thing, this would be a positive update from Zendesk’s end following its previous statement about staying independent earlier this month. The likes of which did result in ZEN stock diving by 14% on June 9.
Regarding yesterday’s report, WSJ cites sources familiar with the matter. While time will tell how this develops, Zendesk’s history with potential takeovers has been complicated, to say the least. Back in February, the company rejected a private-equity offer for a per-share price of between $127 and $137. On top of that, the WSJ alongside Reuters also reported on a rejection of an offer from private equity firm Thoma Bravo as well. Nonetheless, should yesterday’s reports be true, investors would be keeping an eye on ZEN stock now.
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Merck Snags CDC Approval For Use Of Pneumococcal Vaccine In Children; Reportedly Going Through With Seagen Deal – WSJ Report
On the health care front, Merck (NYSE: MRK) appears to be kicking into high gear across the board. To begin with, it received a key update from the Centers for Disease Control and Prevention (CDC). Namely, an expert panel from the CDC unanimously moved to provisionally recommend Merck’s 15-valent Vaxeneuvance vaccine. This would be for its use as an option for pneumococcal vaccination in infants and children under 19. Accordingly, this would be a strategic win for Merck following the U.S. FDA’s decision to expand Vaxneuvance for this indication earlier this week.
Moreover, the company is also reportedly looking to make a deal to acquire Seagen (NASDAQ: SGEN). According to a WSJ report, talks between Merck and the biotech firm are advancing well with a meeting set for this week. Ideally, should Merck succeed in acquiring Seagen, it would be a notable addition to its cancer portfolio. Because of all this excitement around Merck, MRK stock would likely be in focus as well.
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Tesla And PG&E Launch California Power Plant
At the same time, Tesla (NASDAQ: TSLA) is bolstering its energy grid solutions. In brief, it is doing so now with the help of PG&E (NYSE: PCG). Through the current team-up, the duo are working together with Tesla’s Powerwall owners in California. By paying Powerwall owners, the two companies are aiming to stabilize the electric grid and mitigate blackouts in the state. All of this, according to Tesla, will be accomplished via a new virtual power plant (VPP).
In detail, Powerwall owners can opt into the VPP program and sell their excess stored energy. This energy will then go towards powering the grid when it requires additional power. As it stands, those who decide to join the VPP program will receive $2 per kilowatt-hour. By Tesla’s estimates, it currently has 50,000 Powerwall installations that are eligible for this. With Tesla expanding its energy solutions during such a crucial time, investors could have another reason to consider TSLA stock.
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