Stock futures were lower on Thursday following a 1.3% drop in the S&P 500 during the previous session, driven by a sell-off in bonds. The yield on the 10-year U.S. Treasury reached 4.979%, creeping closer to 5% for the first time since 2007.
Market’s Attention on Powell’s Remarks
Given the rising yields, any remarks made by Federal Reserve Chairman Jerome Powell about interest rates at an event in New York on Thursday will be closely watched.
Notable Stock Actions
Several stocks are expected to make significant moves on Thursday:
Tesla (TSLA)
Tesla reported third-quarter adjusted earnings of 66 cents per share, falling short of analysts’ forecasts. Meanwhile, the company’s revenue increased by 9% from the previous year to $23.25 billion but still fell below estimates. As a result, shares of the electric-vehicle manufacturer declined by 4.7%. Furthermore, CEO Elon Musk tempered expectations regarding the Cybertruck, noting that although some deliveries are expected this year, it will take another 12 to 18 months before it becomes a significant profit contributor.
Netflix (NFLX)
Netflix experienced a surge of 13% after reporting third-quarter earnings that surpassed Wall Street estimates. The company also announced paid subscription net additions of about 8.8 million, exceeding forecasts of 6.1 million. As a result, the streaming giant decided to raise the monthly prices of its U.S. premium plan to $22.99 from $19.99, and its basic plan to $11.99 from $9.99.
Taiwan Semiconductor Manufacturing (TSM)
American depositary receipts of Taiwan Semiconductor Manufacturing rose by 2.4% after the company, which is the world’s largest contract chip maker, projected fourth-quarter revenue between $18.8 billion and $19.6 billion. This forecast is higher than the $17.3 billion revenue recorded in the previous quarter.
SAP (SAP)
U.S.-listed shares of SAP experienced a surge of 5.5% as the German business-software company’s third-quarter operating profit and revenue exceeded analysts’ estimates. This was primarily driven by growth in its core cloud business.
Lam Research (LRCX) Disappoints With Outlook
Lam Research (LRCX) stock declined by 3.6% during premarket trading after the company shared a disappointing outlook. The memory chip equipment maker revealed its fiscal second-quarter earnings expectations, forecasting a range of $6.03 to $7.53 per share on revenue of $3.4 billion to $4 billion. This fell short of analysts’ projections of $6.77 per share on revenue of $3.65 billion.
Las Vegas Sands (LVS) Reports Third-Quarter Earnings
Las Vegas Sands (LVS) reported third-quarter earnings of 50 cents per share, slightly below the consensus forecast of 55 cents. However, revenue saw a significant jump, rising from $1.01 billion in the previous year to $2.8 billion. In addition, the casino operator announced its board’s approval of a $2 billion buyback program, which will be implemented until 2025. As a result, the stock experienced a 4.8% increase.
Nokia (NOK) Announces Workforce Reduction Plans
Nokia (NOK) shares declined by 1.2% in the U.S. as the Finnish telecommunications company revealed its intentions to cut its workforce by up to 14,000 employees following a substantial drop in third-quarter profit.
Equifax (EFX) Lowers 2023 Outlook Due to Weak Mortgage Market
Equifax (EFX), the credit-score agency, revised its outlook for 2023, citing a weak mortgage market as the primary reason. Equifax expressed expectations that the current high interest rates in the U.S. will continue to impact the mortgage market negatively in the fourth quarter. As a result, Equifax anticipates a decline of approximately 34% in its full-year mortgage-credit inquiries.
Discover Financial (DFS) Reports Third-Quarter Earnings
Discover Financial (DFS) reported third-quarter earnings of $2.59 per share, falling short of Wall Street estimates of $3.17. The credit-card company’s provision of credit losses amounted to $1.7 billion during the quarter, reflecting a $929 million increase driven by a rise in reserves by $297 million.
Craig Jelinek to Step Down as CEO of Costco Wholesale (COST)
Costco Wholesale (COST) announced that its long-serving Chief Executive, Craig Jelinek, will be stepping down at the beginning of next year. Effective January 1, 2024, Jelinek will pass on his responsibilities to Ron Vachris, the current president and chief operating officer. Following the announcement, Costco’s shares experienced a minor decline of 0.2%.
Upcoming Earnings Reports
On Thursday, earnings reports are expected from several notable companies, including AT&T (T), Philip Morris (PM), Union Pacific (UNP), CSX (CSX), Blackstone (BX), American Airlines (AAL), Alaska Air (ALK), Intuitive Surgical (ISRG), Freeport-McMoRan (FCX), Truist Financial (TFC), and KeyCorp (KEY).
