US OPEN: Twitter surprises with user number beat

• Wall Street set to open higher on tariff relief hopes

• Russell 2000 (US2000) closes in on 1700 pts resistance once again

• Twitter (TWTR.US) surges in pre-market trade on strong user numbers

US stocks are set to open higher today after it was reported that China mulls halving the tariffs on some of the US goods. The US economic calendar is light today, therefore traders should expect markets to ride the sentiment and remain vulnerable to headline risk. Twitter (TWTR.US) surges in pre-session trading after the release of solid user numbers for Q4 2019.

Small-cap Russell 2000 (US2000) recovers in fashion and is trading around 5% higher against the start of the month. The index once again closes in on the resistance zone ranging above 1700 pts mark. As this level was holding firm for a long time, the index may surge once it is finally broken. In such a scenario, attention will shift to ATH in the 1745 pts area. Source: xStation5

Twitter (TWTR.US) is surging in pre-session trading. The company reported Q4 earnings. Revenue grew 11% YoY to $1.01 billion, slightly above market consensus. Adjusted EPS of $0.17 was much lower than the forecasted $0.28. However, the number of monetisable daily average users was the key highlight of the report. It was expected for this number to stand at 148.1 million in Q4, but the report showed it at 152 million with bigger than expected increases in the US and abroad. The company said that product improvements were responsible for more than half of the increase.

Twitter (TWTR.US) is expected to make a big jump at the launch of today’s session. Company reported very strong user numbers. However, even if we take into account a close to 8% jump signalled in pre-session trading, the company would still trade below levels from before Q3 earnings release. The 200-session moving average (purple) could be a hurdle to watch for this stock today. Source: xStation5

Cardinal Health (CAH.US) is another US company that reported earnings ahead of the opening bell. The US health care company recorded adjusted EPS of $1.52 in fiscal Q2 2020 (calendar Q4 2019), a reading that was higher than expected $1.22 and higher than $1.29 a year ago. Revenue grew 5.3% YoY to $39.74 billion and slightly topped median estimate of $39.41 billion. The company raised guidance for adjusted EPS from continuing operations for fiscal-2020 to $5.20-$5.40 from previous $4.85-5.10.

Bristol-Myers Squibb (BMY.US) reported adjusted EPS for Q4 2019 at $1.22 against an expected $0.94. Revenue came in at $7.95 billion, 28.5% higher than expected. Sales of key cancer drug Opdivo declined 2.5% YoY and 3% QoQ. However, the shortfall was offset by strong performance of other drugs, like Eliquis and Orencia. The company expects full-2020 EPS in the $6.00-6.20 range and full-2020 revenue between $40.5 and $42.5 billion. The Board approved an increase of $5 billion to a share buyback programme.

Cardinal Health (CAH.US) has been trading in a symmetrical wedge pattern as of late. However, thanks to solid earnings release, the stock is set to open above the topside resistance of the pattern. Indicated opening price of $56 would put the stock in a striking distance of November 2019 high ($56.65). Source: xStation5