Stock Futures Mixed Ahead of Unemployment Data
The U.S. stock futures are little changed in the pre-market trading after the stock market shrugged off the July inflation report. Investors are keeping an eye on the weekly jobless claims data, which will be released this morning. Many are betting their money on lower jobless claims, which supports the narrative of a strengthening job market.
The core inflation, which is considered a more reliable measure by economists, rose by just 0.3% in July. “Inflation has, at a minimum, paused,” said Brad McMillan, chief investment officer at Commonwealth Financial Network. “For both the headline and core figures, the monthly and annual numbers were stable or down from last month. Based on that data, inflation is certainly not on an unstoppable increase.”
Despite the COVID-19 case numbers rising in the U.S. and around the world, the stock market continues to power higher on infrastructure prospects and inflation data. And these developments continue to present opportunities in the stock market today. For instance, Caterpillar (NYSE: CAT) and United Rentals (NYSE: URI) stand to benefit assuming the bill becomes law. The Dow, S&P 500, and Nasdaq futures are all trading in the positive territory, moving 0.12%, 0.05%, and 0.04% higher respectively as of 6:58 a.m. ET.
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Disney’s (DIS) Legacy Units’ Performance In Focus As Streaming Growth Slows
A lot of the attention will be on Walt Disney’s (NYSE: DIS) earnings report after the closing bell today. The House of Mouse may have taken a hit most when most of its theme parks and other in-person entertainment were forced to shut. However, with vaccinations ramping up, the company reopened its Disneyland theme park in California in late April this year.
Now, that is all great news for its legacy businesses to resume their operations. But it could also mean fewer subscriptions for its streaming business, Disney+. Unless you have been living under a rock, you would know the streaming unit has been the key growth driver for the entertainment giant during the pandemic. If Netflix (NASDAQ: NFLX) earnings report is of any guidance, it is likely that Disney+ is going to record a slowdown in growth as life begins to return to normal in the U.S.
With its arsenal of theme parks, cruise ships, and blockbuster movies, investors will be looking for improvements in Disney’s financial performance. Some may see it as a good benchmark on how the reopening of the economy is taking place. Also, there are good reasons for long-term investors to feel confident about the Disney brand. That may be strong enough to support whatever direction the business is heading in the future. Even if the company fails to meet expectations, would any post-earnings weakness in Disney stock present an opportunity to buy on dips?
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Airbnb To Offer Signs Of Pandemic Recovery
Airbnb (NASDAQ: ABNB) is another company set to report second-quarter earnings after the market closes today. Many are watching the travel platform closely to see how it has been benefiting from the reopening of economies. Meanwhile, the spread of the delta variant could also cause travelers to be more cautious, putting their trips on hold.
From its first-quarter results, Airbnb mentioned that the rebound in travel had firmly taken place as people started to travel again. This is made possible thanks to vaccination programs and restrictions being eased. Although bookings still have some way to go before reaching the pre-pandemic level, revenue has bounced back considerably. As shareholders, you would like to see a sequential increase from the first quarter. Analysts on Wall Street are also expecting revenue to rise to $1.25 billion. That would be a sizable increase from just $334.8 million in the prior-year quarter.
The company has also been working on cutting down its costs since the onset of the pandemic. This would allow it to operate more efficiently coming out of the pandemic. Many may be looking to see if the company will be able to beat earnings per share (EPS) estimates in the second quarter. If you’re looking to invest in a stock with a strong competitive advantage in a growing industry, would ABNB stock fit the bill?
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Sonos Blasts Loud Quarterly Earnings Beat & Solid Guidance
Home audio company Sonos (NASDAQ: SONO) came out strong in its quarterly earnings yesterday, delivering a surprise profit. From its third-quarter results, revenue came in 52% higher year-over-year to $378.8 million. The company also raised its guidance for the full year. It expects revenue and adjusted EBITDA to come in higher as compared to their prior guidance.
“We believe that the strong demand for our products is unwavering and underscores the uniqueness and power of our business model where customers start with one product and expand with more over time,” Chief Executive Patrick Spence.
Certainly, Sonos has outperformed the broader stock market this year. But investors are also wondering, what’s next for the stock? As the strong speaker demand continues, Sonos is probably one of the growth stocks that you didn’t see coming. Perhaps that’s what happens when you’re consistently turning the volume knob higher.
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Notable Earnings To Watch Today
A clutch of tech companies are scheduled to report earnings today. South Korean e-commerce company Coupang (NYSE: CPNG) is trading lower in the pre-market after posting unsatisfactory performance this quarter yesterday. Admittedly, a few tech companies have reported wider than expected losses. But this earnings season has been going quite well and most of them have so far topped estimates. This shows us that there will always be a silver lining in a heavily battered economic environment. Some of the notable names reporting prior to the opening bell include Palantir Technologies (NYSE: PLTR), Baidu (NASDAQ: BIDU), and iQiyi (NASDAQ: IQ).
There are also major companies reporting earnings after the closing bell today. They include Walt Disney, Airbnb, SoFi Technologies (NASDAQ: SOFI), and DoorDash (NYSE: DASH). So, whether it is digesting the new unemployment claims or simply following the earnings reports, there should be enough to keep you busy.
