Stock futures fell Tuesday morning, under pressure from rising oil prices. Meanwhile, Oracle shares dropped 10% in extended trading.
Futures tied to the Dow Jones Industrial Average lost 76 points, or 0.22%. S&P 500 futures fell 0.3%, while Nasdaq 100 futures were off 0.33%.
Oracle slid 10% in extended trading after posting revenue and revenue guidance that was weaker than expected. The software company reported $12.45 billion in revenue, lower than the $12.47 billion forecasted by analysts polled by LSEG, formerly known as Refinitiv. Other cloud competitors — including Amazon, Google-parent Alphabet and Microsoft — all slid in premarket trading.
Oil prices also weighed on sentiment raising fears about sticky inflation and slowing global economic activity. U.S. crude prices touched the highest since November of last year, according to FactSet. Chevron shares were among the few premarket gainers.
In the only economic data point of note, the NFIB Small Business Index nudged lower to 91.3, down 0.6 points and slightly below the Dow Jones estimate of 91.5.
The moves following a winning day on Wall Street. The Nasdaq Composite led the three indexes with a gain of 1.1%, while the S&P 500 and Dow added about 0.7% and 0.3%, respectively. It was the second positive session for the S&P 500 and Nasdaq, and the third for the Dow.
Much attention is focused on key inflation data due later in the week, with the consumer price index expected Wednesday and the producer price index slated for Thursday.
Both data points come ahead of the Federal Reserve’s policy meeting next week. Current market pricing implies a 93% probability that the central bank will keep interest rates steady at the meeting, according to CME Group’s FedWatch Tool, which measures futures market pricing. The Wall Street Journal reported Sunday that there was a consensus within the Fed to not hike rates this month and less urgency for additional hikes later this year.
“The menu of economic reports this week offers several tempting entrees for analysts to sink their teeth into,” said Pete Biebel, senior vice president at Benjamin F. Edwards. “If any of those reports come in much worse than expectations, it will likely cause a bit of market indigestion.”
Correction: An earlier version misstated the implications of the CME FedWatch Tool.
Stocks making the biggest moves before the bell: Oracle, WestRock and more
These are the stocks moving the most in premarket trading:
Read the full list of stocks moving here.
— Samantha Subin
Oil prices weigh on investor sentiment
Oil prices rose Tuesday morning and weighed on stocks as investors worried about sticky inflation and slowing global economic activity.
U.S. crude prices touched the highest since November of last year, according to FactSet. The ICE Brent crude last added 49 cents to $91.13 a barrel, while U.S. West Texas Intermediate crude futures gained 62 cents to $87.91.
Meanwhile, shares of Chevron were among the few premarket gainers.
— Sarah Min, John Melloy
WestRock shares jump on news of deal with Smurfit Kappa
Westrock shares roared higher early Tuesday on news that the paper and packaging company is moving ahead on its merger with Europe’s Smurfit Kappa.
The U.S. company saw its stock rise 8.6% in premarket trading following an announcement that the two firms will create a global behemoth worth about $20 billion.
However, investors showed less confidence that the deal was a good one for Smurfit Kappa, sending its stock down about 8% on the FTSE 100.
Shares of TSMC and Foxconn climb after Apple-Qualcomm deal
Wall Street analysts and Qualcomm officials had previously said they expected Apple to use an internally developed 5G modem starting in 2024.
TSMC is reported to be one of the manufacturers for Qualcomm’s chips, as well as the manufacturer of Apple’s chips that power its devices.
Shares of Foxconn, which manufactures Apple products and trades as Hon Hai Precision Industry, saw a larger gain of as much as 2.38%.
— Lim Hui Jie
Country Garden shares jump about 9% after creditors agree to extend onshore bonds
Shares of Chinese real estate developer Country Garden Holdings jumped by nearly 9% before paring gains.
It came after the company’s creditors reportedly voted to extend repayments on six onshore bonds by three years.
Creditors voted Monday for proposals by the embattled firm to extend repayments on eight onshore bonds worth 10.8 billion yuan ($1.48 billion).
Reuters, citing two sources, said creditors approved extending six out of the eight bonds, while the other two bonds will see voting delayed.
— Lim Hui Jie
Arm IPO’s price could top $51 per share: Reuters
Chip designer Arm is reportedly “getting close” to securing enough investor support to attain the fully diluted valuation of $54.5 billion it seeks in its initial public offering, Reuters reported, citing sources familiar with the matter.
This means Arm will likely be able to price the IPO “at the top or above” the $47-to-$51-per-share range, the report said.
The sources said Arm is also discussing the possibility of raising the price range and seeking a valuation of more than $54.5 billion, in light of strong investor interest.
However, Arm will not offer more shares, as SoftBank wants to retain a 90.6% stake in Arm following the IPO, the sources said.
— Lim Hui Jie, Reuters
Investors may be ‘overlooking’ Nvidia AI catalysts
Nvidia’s “underappreciated” pipeline of generative artificial intelligence products could spell major upside ahead for its stock despite its 8% pullback so far this month, according to Bank of America.
“In part, NVDA’s compressed valuation already reflects investor concerns about sustainability of genAI capex, geopolitical concerns (China restrictions) and (overstated) competitive risks from AMD/INTC,” analyst Vivek Arya said when listing the stock as a top pick.
CNBC Pro subscribers can read the full story here.
— Lisa Kailai Han
Investors react to latest earnings reports
A handful of stocks moved in extended trading after reporting earnings.
Oracle dropped more than 9% after the bell following a mixed report for the fiscal first quarter. The company beat expectations of analysts polled by LSEG for earnings per share by 4 cents, coming in at $1.19 when adjusted. But revenue came in slightly below consensus, with Oracle posting $12.45 billion despite analysts anticipating $12.47 billion.
Meanwhile, retailer Casey’s General Stores was up more than 3%. The retailer blew past earnings expectations, posting $4.52 per share on a consensus estimate of $3.36 from analysts polled by FactSet. That took attention away from revenue, with the company reporting $3.87 billion while Wall Street expected $3.9 billion.
— Alex Harring
Stock futures are little changed
Stock futures are little changed shortly after 6 p.m. ET. Futures tied to the Dow, S&P 500 and Nasdaq 100 all traded near flat.
— Alex Harring