Five things you need to know before the market opens on Tuesday, November 1:
1. – Stock Futures Higher as Dollar Retreats, Fed in Vision
U.S. equity futures continued their recent gains on Tuesday, while the dollar fell against its global peers and oil prices rose, as investors stabilized. designated for the beginning of Federal Reserveimportant two-day policy meeting in Washington.
With central banks around the world, be aware of the impact of inflationary Fighting over the global growth outlook, signaling the possibility of slower rate hikes in the coming months, investors are betting on a dovish message from Fed Chairman Jerome Powell tomorrow, even if they bet 75 base point increased key lending rates, currently between 3% and 3.5%.
The Reserve Bank of Australia, one of the first central banks to reduce the pace of the tightening cycle earlier this year, delivered a less-than-expected increase of 25 basis points overnight, putting interest rates on hold. benchmark lending to a nine-year high. 2.85%.
The Fed’s ‘pivot’ for rate hikes in 2023, as well as a rebound in industrial and other non-tech earnings for many US companies in the September quarter and stronger underlying economic data expected, created a solid momentum for the stock in the last two months of the year.
However, earnings may struggle to maintain that optimism, due to that collective S&P 500 Profits – once the energy sector is out – are likely to drop 0.4%, with very modest gains expected in the three months ending December.
The market is currently facing a series of key data points, including Wednesday’s Fed rate decision, Thursday’s policy meeting at the Bank of England, Friday’s jobs report. 10 and the midterm elections next Tuesday, will test the resilience of the recent rally.
Starting the day on Wall Street, futures contracts tied to the S&P 500 were priced up 27 points at the open while contracts linked to the Dow Jones Industrial Average were valued up 160 points. The tech-focused Nasdaq was valued at a 95-point gain.
Overseas, Stoxx 600 across the region rose 1.3% in early Frankfurt trade, while London’s FTSE 100 gained 1.55%, driven in part by higher oil prices and lower third-quarter earnings. $8.2 billion from BP plc.
Overnight in Asia, the region-wide non-Japan MSCI index gained 2.58% to close in trade, while Japan’s Nikkei 225 gained 0.33% to a six-week high of 27,5678.92 the point.
2. – Toyota slips as world’s largest automaker cuts profits in 2023
Toyota Motor Co (TM) Shares fell in pre-market trading after the world’s largest carmaker cut its short-term profit target and lowered its full-year output forecast, citing ongoing chip shortages. output and input costs increase.
Toyota said September-quarter profit fell 25% year-on-year to $3.8 billion, distrusting Street’s forecast at all, even as sales rose 22% to 9.2 trillion yen. , equivalent to 62.1 billion USD. Rising input costs, from labor to raw materials, offset a windfall from a weaker yen, which fell to its lowest level in more than three decades against the US dollar last month.
Looking at the second half of its fiscal year, which ended in March, Toyota said it saw sales in the region of $120 billion, with profit of $16.2 billion, but slashed its production target. 500 million to 9.2 million vehicles as they expect a lack of chips in this area to sustain well next year.
Toyota’s U.S.-listed shares fell 0.3% in pre-market trading at an opening price of $138.40 per share. The main Tokyo listing fell 1.9% on Tuesday, compared with a 0.33% gain in the benchmark Nikkei.
3. – President Biden threatens ‘Wind tax’ on big oil profits
President Joe Biden accused America’s biggest oil companies of waging “a war” that brought record profits but resulted in Americans paying more for gas and home heating. .
Speaking to reporters at the White House late Monday, Biden threatened to ask Congress to raise taxes on oil companies unless they use those profits to boost production and reduce costs. overall retail.
“It’s time for these companies to stop profiting from war,” Biden said, adding that he would “work with Congress to review the options available to us.”
“Otherwise, they will have to pay higher taxes on their excess profits and face other restrictions,” he said.
Exxon Mobil (XOM) and its smaller rival Chevron (CVX) announced combined net income of just over $31 billion for the three months ended September, bringing their total net income for the nine months to about $72.4 billion — a figure still low compared to the total. net income of $116.2 billion from Apple (AAPL) and Microsoft (MSFT) – the two biggest tech companies – during the same period.
Exxon shares were 1.75% higher in pre-opening trading at an opening price of $112.75 per share, while Chevron rose 1.82% to $184.20 per share.
4. – AMD higher ahead of Q3 earnings amid chip-area Gloom
Advanced Microphone Device (AMD) Shares edged higher in pre-market trading ahead of the chipmaker’s third-quarter earnings after the closing bell.
AMD, which has fallen more than 42% since the beginning of August amid soaring short-term interest rates, a tech stock withdrawal and new US restrictions on technology exports to China, warned in October 6 that significantly weaker PC demand will cut about $1 billion from its summer turnover forecast.
Texas Instruments (TXN) echoed that concern in its third-quarter update last week, which noted a drop in demand for chips found in personal electronics and industrial equipment.
Still, AMD is still likely to post a solid revenue increase of 30.2% year over year, taking its revenue peak to around $5.62 billion in the three months ended September. Earnings are likely. down about 9.3% year over year to 68 cents per share.
AMD stock was marked 1% higher in pre-market trading, showing an opening price of $60.66 per share.
5. – Pfizer Q3 earnings to focus on Covid vaccine sales, headwinds against the dollar
Pfizer (PFE) Shares edged higher in pre-market trading ahead of the drug and vaccine maker’s third-quarter earnings before the opening bell.
Analysts expect Pfizer’s profit to grow about 4% year over year to $1.39 per share in the three months ending September, with revenue falling about 12.7% to 21.04 billion USD thanks in part to currency trends related to the strength of the US dollar.
Earlier this summer, Pfizer kept its revenue forecast of $98 billion to $102 billion for the full year, with Comirnaty vaccine and Paxlovid Covid antiviral treatment combined for about $54 billion. .
Pfizer also said it plans to raise the cost of its Covid vaccine, which currently sells to the US government for $30 per dose, to $110 to $130 per dose early next year.
Shares of Pfizer were marked 0.5% higher in pre-market trading, showing an opening price of $46.78 per share.
