Stock Market Futures Tick Lower Following Positive Session On Monday
U.S. stock futures are pointing lower as investors anticipate key inflation data due out later in the week. If the number is cooler than April’s number, it could suggest that inflation has peaked. Meanwhile, investors are still assessing whether the recent movement in stocks is a dead-cat bounce or if the stock market has reached a bottom following this year’s sell-off.
Providing more insights in the current market is Ed Yardeni, president at Yardeni Research. He states “To a large extent, clearly, with the benefit of hindsight, the market was overvalued,” he said. “A lot of that was in the negative cap seat, big cap names, related companies. I think we’ve seen a tremendous correction in that area. And now the question is whether the market can accept the kind of earnings expectations that analysts are delivering and whether those expectations will be correct.” While you consider all this, here’s how the major stock index futures are doing today. As of 6:07 a.m. ET, the Dow, S&P 500, and Nasdaq futures are declining by 0.41%, 0.44%, and 0.54% respectively.
Amazon Stock Rise After Stock Split Raises Retail Interest
Amazon (NASDAQ: AMZN) rose on Monday’s intraday trading following a 20-for-1 stock split. This is the second notable stock split in 2022 after Alphabet (NASDAQ: GOOGL) announced a 20-for-1 stock split alongside its earnings report. Of course, a stock split doesn’t change the fundamentals of a company. But it makes the stock more accessible for people wanting to buy the stock.
That said, amid the broad market’s sell-off and the geopolitical tensions this year, stock splits from blue-chip firms might be one of the few events that can cheer up some investors. But let’s face it, stock splits, arguably, were a thing in the past. And if we look back, stock splits have faded from prominence after the dot-com bust in 2000. That’s until we see the market quickly rewarded companies like Tesla (NASDAQ: TSLA) and Alphabet when they divided their shares. Each of them enjoyed a post-announcement rally.
In light of all these, it’s natural that more companies could follow suit. Some of the tech sector’s most prominent companies are planning to split their stocks in the coming months. Amongst them are Kinetik (NASDAQ: KNTK) and Shopify (NYSE: SHOP). If anything, this catalyst comes at a good time when investors are growing skeptical of these growth names.
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Apple To Offer ‘Buy Now, Pay Later’ Credit In Challenge To Affirm
Apple (NASDAQ: AAPL) is jumping on the “buy now, pay later” space, rivaling the offerings popularized by Affirm (NASDAQ: AFRM). The service, known as Apple Pay Later, will be available through Apple Pay. With this new feature, iPhone and Mac users in the US can pay for purchases in four installments over six weeks without any interest charge. Following this news, AFRM stock fell 5.5% on Monday’s intraday trading, extending what is now a 75% drop year to date.
Diving right in, Apple will be using Goldman Sachs (NYSE: GS) as the lender for the loans needed for installment offerings. For those uninitiated, Goldman has been Apple’s partner for Apple Card since 2019. Essentially, it could help drive Apple Pay adoption and convince more users to use their iPhone to pay instead of standard credit cards. And that could drive additional revenue for Apple’s services business, which takes a cut on every transaction made with Apple Pay.
What’s more, Apple also announced a new version of MacBook Air, it’s best selling Apple laptop. The new design update and a more powerful M2 chip could boost Mac sales in the coming quarters. Additionally, the company also announced a 13-inch MacBook Pro, which is also set to be released next month alongside MacBook Air. With the new MacBooks already seen as becoming a hit, would you include AAPL stock on your watchlist in the stock market today?
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Kohl’s In Negotiations With Franchise Group To Go Private At $8 Billion Price Tag
Kohl’s Corporation (NYSE: KSS) has entered into an exclusive negotiation for a sale to retail store operator Franchise Group. For those unfamiliar, Franchise Group is a holding company of market-leading and emerging brands. The company acquires and manages franchise companies like American Freight, Buddy’s Home Furnishing, and The Vitamin Shoppe, among others.
In brief, Franchise Group is proposing to buy the retailer for $60 per share which would value Kohl’s at roughly $8 billion. Following this, Kohl’s stock is up by over 13% in the premarket trading hours. Also, Franchise Group will be working with Oak Street Real Estate Capital to finance the deal mostly through real estate, according to some sources. This latest piece of news follows a saga that began in December 2021 when hedge fund Engine Capital had urged the company to consider a sale or another alternative to boost its stock price. With that being said, should investors be paying attention to KSS stock right now?
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Oil Prices Gain As China Eases COVID Lockdowns; Saudi Arabia Boosts Official Selling Prices To Asia
At the same time, energy costs continue to extend their gains on Tuesday as well. For the most part, this would be thanks to expectations regarding growing demand from China following easing of Covid lockdowns. Evidently, Brent crude futures were up by $0.19 to $119.70 per barrel. Also, U.S. West Texas Intermediate (WTI) crude futures saw gains of $0.25, totalling $118.75 a barrel. This is just a day after it hit a three-month high of $120.99 yesterday. As China continues to ease restrictions across its industrial and commercial sectors, the focus on oil is apparent. Over the coming weeks, ANZ Research notes that demand for oil will likely be driven higher by easing travel restrictions.
Furthermore, another major driving factor for oil prices now would be Saudi Arabia, the largest oil exporter worldwide. In detail, state oil producer Aramco recently announced plans to raise the July official selling price for Arab light crude oil to Asia. This translates to a price increase of $2.10 per barrel from June to a $6.50 per barrel premium. Not to mention, the Organization of the Petroleum Exporting Countries and allies (OPEC+) is also raising its output for July and August. Namely, OPEC+ is now releasing 648,000 barrels per day, 50% more than its initial plans. Where rising demand meets rising oil prices, most would see opportunity in the energy sector today. As such, it would not surprise me to see investors tuning in to the top oil stocks around as well.
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