Stock Market Futures Edges Lower Following Latest Fed Policy Update
U.S. stock futures are edging lower heading into Thursday’s trading session. By and large, it seems that investors are still digesting the points from Fed Chair Jerome Powell’s latest press conference. For starters, the Federal Reserve is raising the short-term interest rate by 0.50%. While this would mark the largest rate hike since May 2000, it would serve to mitigate inflationary pressure on consumers now. Additionally, the central bank is focusing on further raising interest rates while trimming its almost $9 trillion balance sheet.
To help investors better understand the current situation is BlackRock’s (NYSE: BLK) chief investment officer of global fixed income, Rick Rieder. He writes, “In all policy moves, there are negative consequences, which hopefully are muted, and are less impactful than the issue that is being addressed, and today that issue is inflation.” Rieder continues, “There are many factors out of the Fed’s control (supply chain disruptions and geopolitics, for instance), but we’ll be watching closely to see how the Fed’s tightening of financial conditions impacts the broad economy and employment levels, which are very firm today but can clearly soften alongside of aggressive inflation-fighting monetary policy.”
In the larger scheme of things, it would not surprise me to see investors taking more defensive or cautious positions now. Regardless, today remains another day full of notable earnings to keep up with as well. As of 4:45 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading lower by 0.56%, 0.80%, and 1.06% respectively.
Twilio In Focus After Topping Earnings Estimates In Fourth Fiscal Quarter Financial Report
On the earnings front today, Twilio (NASDAQ: TWLO) seems to be among the top tech stocks to watch. Namely, the company posted overall solid figures in its fourth-fiscal quarter update after yesterday’s closing bell. Diving in, Twilio broke even in terms of earnings per share, handily beating estimates of a $0.21 per share loss. Furthermore, the company raked in a total revenue of $875.4 million, also above Wall Street projections of $863.81 million. Year-over-year, this adds up to a commendable 48% year-over-year jump. Also, Twilio’s revenue dollar-based net expansion rate (RDNER) is up by 126% over the same period. All of this contributes to a rather good year for the company in the larger scheme of things.
For the fiscal year, Twilio’s total revenue came in at $2.84 billion, representing a sizable 61% year-over-year increase. Moreover, the company saw its RDNER surge by 131% over the previous fiscal year. Commenting on the company’s latest performance is CEO Jeff Lawson. He notes, “The combination of our leading cloud communications platform with Twilio Segment’s #1 customer data platform gives Twilio an unparalleled view into the customer journey, and I’ve never been more excited about the future of the company than I am today.” As more workspaces opt for hybrid arrangements, demand for Twilio’s services could, in theory, persist. Because of this, I could see TWLO stock gaining attention in the stock market today.
CVS Stock Gains Following Stronger-Than-Expected Earnings Figures, Raises Annual Earnings Outlook
At the same time, CVS Health (NYSE: CVS) is also receiving similar attention right now. In its latest financial release, the company saw earnings of $2.22 on revenue of $76.83 billion for the quarter. For reference, this is versus consensus forecasts of $2.15 and $75.39 billion. Notably, CVS says that this is thanks to a growing demand for its prescriptions and non-Covid-related offerings across the board. This is apparent as the company’s same-store sales are up by 10.7% year-over-year. In particular, CVS’s pharmacy and front store segments are seeing year-over-year same-store sales gains of 10.1% and 13.2% respectively.
In detail, CVS notes that its bid to attract new customers, greater prescription filling volume, and more seasonal illness-related spending are key contributors to its current momentum. However, CVS is seeing a deceleration in sales relating to Covid vaccines and testing for the quarter. Nevertheless, the company seems to be confident about its ability to further diversify beyond Covid-related health care solutions. To accomplish this, CVS has and continues to introduce more services to its retail locations. This includes but is not limited to health insurance and in-house medical consultation offerings. Moreover, CVS is also raising its full-year earnings outlook to a range of $8.20 to $8.40 from a previous guidance of $8.10 to $8.30. All this alongside the incoming wave of fourth vaccination shots could put CVS stock in the limelight today.
Block Earnings On Tap After Closing Bell: What To Know
Block (NYSE: SQ) will be reporting its latest quarterly financials after today’s closing bell. As it stands, Wall Street is expecting earnings of $0.19 per share and a total revenue of $4.2 billion. Another core metric to note would be Block’s gross payment volume (GPV). The likes of which analysts are forecasting will come in at about $44.6 billion. On the whole, this would represent noticeably year-over-year declines for Block on the revenue and earnings per share fronts. In fact, current projections are pointing towards the company’s first revenue decline in four years. This would be understandable with demand for its Square fintech ecosystem declining from pandemic-era highs.
More importantly, investors should also note that GPV estimates for Block suggest healthy growth for its core financial services. Should the company report a GPV of $44.6 billion, it would add up to a gain of 34% year-over-year. Worth noting, Block has been and still is working on expanding its payments ecosystem toward a larger audience. This includes efforts to cater to small-and-medium enterprises, bolstering services from its acquisitions, and optimizing its Cash App peer-to-peer payments platform. Nonetheless, SQ stock could be worth keeping an eye on after today’s opening bell.
Other Hot Earnings To Consider In The Stock Market Today
Speaking of earnings, here are more major players stepping up to the plate for their latest earnings calls today. In the pre-market, we have Shopify (NYSE: SHOP), Penn National Gaming (NASDAQ: PENN), Crocs (NASDAQ: CROX), DataDog (NASDAQ: DDOG), Royal Caribbean Cruises (NYSE: RCL), and Wayfair (NYSE: W) on tap. Not to mention, crude oil giant ConocoPhillips (NYSE: COP) will also be reporting earnings at the same time.
Alternatively, the likes of FuboTV (NYSE: FUBO), Lucid Motors (NASDAQ: LCID), Cloudflare (NYSE: NET), Opendoor Technologies (NASDAQ: OPEN), and MercadoLibre (NASDAQ: MELI) are announcing financials in the post-market hours. Other notable firms to consider at this time slot would be Virgin Galactic (NYSE: SPCE) and DoorDash (NYSE: DASH). Pair all this with monetary policy updates and investors certainly have another busy day ahead in the stock market now.
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