- Wall Street indices open lower
- Disappointing earnings from Tesla and Alphabet weigh on market sentiment
- US100 drops to 1-month low
- AT&T gains on better-than-expected Q2 subscriber additions
- Avantor jumps on S&P MidCap 400 addition
Wall Street indices launched today's trading lower, following release of disappointing earnings reports from Alphabet and Tesla yesterday after close of the cash session. S&P 500 opened 0.9% lower, Dow Jones traded 0.5% down at session launch, while Nasdaq slumped 1.5%. Small-cap Russell 2000 opened 0.5% lower.
US economic calendar for today includes some release like flash PMIs for July at 2:45 pm BST and new home sales data for June at 3:00 pm BST. However, neither of those tends to trigger large market moves on Wall Street. While flash PMIs are an important and a timely measure of sentiment within the economy, more attention is paid to ISMs when it comes to the United States.
Source: xStation5
Tech sector is underperforming today as disappointing earnings releases from Alphabet and Tesla weigh on market sentiment. Nasdaq-100 futures (US100) has broken below the July 19 lows earlier today and are now testing the 19,650 pts support zone. The index is trading at the lowest level in a month. Should we see a decisive break below the 19,650 pts area, the 19,525 pts swing level may become the next target for sellers. However, a more important support zone can be found ranging around a psychological 19,000 pts level.
Company News
Tesla (TSLA.US) and Alphabet (GOOGL.US) launched today's trading 8% and 4% lower, respectively. Both companies reported disappointing Q2 earnings results yesterday after the close of Wall Street session.
AT&T (T.US) launched today's trading higher after reporting Q2 2024 results before opening of the Wall Street session. Company reported a 0.3% YoY drop in Q2 revenue to $29.80 billion (exp. $29.97 billion) and a 1.3% YoY increase in adjusted EBITDA to $11.3 billion (exp. $11.31 billion). Adjusted EPS was reported at $0.57, in-line with market expectations but lower than $0.63 report in a year ago quarter. However, company's share price gains today are driven by subscriber numbers - AT&T reported a net addition of 593 thousand new Wireless postpaid subscribers, while the market expected an addition of around 383 thousand. AT&T kept full-year outlook unchanged and still expects adjusted EPS to reach $2.15-2.25.
Visa (V.US) launched today's trading lower after releasing disappointing fiscal-Q3 earnings report yesterday after close of the market session. Visa reported a 9.9% YoY increase in fiscal-Q3 revenue to $8.90 billion (exp. $8.96 billion) and a 5% YoY increase in payment volume to $3.33 trillion (exp. $3.41 trillion). Adjusted EPS improved from $2.16 in fiscal-Q3 2023 to $2.42 in fiscal-Q3 2024 (exp. $2.43). Visa expects fiscal-Q4 and full-year fiscal-2024 revenue to increase by 'low double digits'.
Avantor (AVTR.US) opened higher after it was reported that the company will replace Quidelortho (QDEL.US) in S&P MidCap 400 index. Changes will become effective prior to the launch of Wall Street session on July 26, 2024.
Analysts' actions
- Estee Lauder (EL.US) upgraded to 'outperform' at RBC. Price target set at $131.00
- General Motors (GM.US) downgraded to 'equal-weight' at Morgan Stanley. Price target set at $47.00
Tesla (TSLA.US) launched today's trading with a big bearish price gap, erasing majority of gains made earlier this month. Plunge has been triggered by a disappointing Q2 2024 earnings report, release by the company yesterday after close of the Wall Street session. The nearest support zone to watch can be found in the $210 area. Source: xStation5
