Stock Market Futures Dip Following Hawkish Remarks From Fed Chair Jerome Powell
U.S. stock futures are declining as we approach the end of the current trading week. This comes as investors seem to be weighing out their options in the stock market today. On one hand, the latest batch of cyclical business earnings suggests that consumers are handling inflation in a better-than-expected way. This is apparent with companies like Tesla (NASDAQ: TSLA) and American Airlines (NASDAQ: AAL) beating estimates across the top and bottom lines.
On the other hand, Federal Reserve Chairman Jerome Powell also provided an update on the central bank’s plans to reel in inflation. As it stands, Powell’s remarks point towards a half-point rate hike likely rolling in next month. Because of this, most of the major stock indexes returned their earlier gains by yesterday’s closing bell. As investors look to take in all this information over the weekend, analysts are already weighing in on things.
Speaking on this is LPL Financial’s (NASDAQ: LPLA) asset allocation strategist, Barry Gilbert. He writes, “Looking at the Fed’s most recent Beige Book, local U.S. businesses remain resilient despite elevated uncertainty.” Gilbert continues, “Inflation, COVID, and the conflict in Ukraine will keep uncertainty elevated in the near term, but if we can navigate these challenges we believe there are solid prospects of a pick-up in growth in the second half of the year.” Aside from all this, investors also have today’s batch of stock market news to consider. As of 6:38 a.m. ET, the Dow, S&P 500, and Nasdaq futures are trading lower by 0.41%, 0.42%, and 0.47% respectively.
Snap Sees Greater-Than-Expected Daily Active User Count In Latest Quarterly Update
Snap (NYSE: SNAP) posted its first fiscal quarter earnings release after yesterday’s closing bell. For starters, the social media camera firm is looking at a loss per share of $0.02. This would be just shy of Wall Street estimates of a $0.01 earnings per share. Additionally, the company also raked in a total revenue of $1.06 billion. While this is below consensus forecasts of $1.07 billion, it adds up to a 38% year-over-year increase. Overall, CEO Evan Spiegel sums it up by saying, “The first quarter of 2022 proved more challenging than we had expected.” Even so, investors appear to be paying attention to the company’s latest user count.
Namely, Snap’s global daily active users (DAUs) are at 332 million for the quarter. This is above analyst expectations of 330 million and represents an 18% year-over-year increase. Looking forward, Snap is also expecting this momentum in its user base to persist into the current quarter. During which, it forecasts DAUs will increase to about 344 million, above estimates of 341.4 million. Even so, the company is foreseeing further pressure from a slew of macroeconomic headwinds. The likes of which include supply chain disruptions, inflation, and labor shortages impacting Snap’s customers’ advertising funds.
Simply put, the short-to-mid-term road ahead looks rather bumpy for Snap. As a prominent name among the top social media stocks, long-term investors may be keen to jump on SNAP stock now. This could be the case as the company’s offerings are still attracting more users.
Qualtrics Gains On Subscription Revenue Surge
Another firm to consider amidst the current batch of earnings reports would be Qualtrics (NASDAQ: XM). In brief, the experience management firm helps organizations manage and improve their business relationships. This includes solutions revolving around customer, employee, product, and brand interactions. After yesterday’s closing bell, Qualtrics posted its first fiscal quarter results. Diving in, the company saw a net loss of $292.3 million alongside revenue of $335.6 million. Year-over-year, Qualtrics’ revenue is up by 41%. More importantly, another key metric worth noting would be the company’s subscription revenue. According to Qualtrics, this income from its subscriptions is up by 50% year-over-year.
Commenting on the company’s latest quarterly performance is CEO Zig Serafin. He starts by saying, “Q1 was an outstanding quarter for Qualtrics – in fact, it was the biggest Q1 in our history.” Serafin elaborates, “These results highlight the demand for experience management as companies of every size and in every industry navigate an uncertain environment. I’m particularly pleased to deliver another quarter of positive non-GAAP operating margin while continuing to invest in long-term, durable growth.” All in all, Qualtrics appears to be stepping up to the plate as demand for experience management services rises. As such, it would not surprise me to see XM stock turning some heads in the stock market today.
Warner Bros. Discovery Pulls The Plug On CNN+, Looks To Bolster Core Streaming Platform
In other news, the recently formed Warner Bros. Discovery (NASDAQ: WBD) is already shaking things up. Notably, the company is looking to shut down its CNN+ streaming service on April 30. This comes just less than a month since the news network’s launch. At face value, the current divestment may seem counter-intuitive considering the current popularity of streaming content. However, WBD is looking to better integrate CNN into its new and improved streaming arsenal moving forward.
According to CNN Worldwide CEO Chris Licht, this move to pull the plug on CNN+ is a strategic play. In his words, “CNN will be strongest as part of WBD’s streaming strategy which envisions news as an important part of a compelling broader offering along with sports, entertainment, and nonfiction content.” Accordingly, Licht also notes that CNN will continue to bolster its core new network offerings while expanding CNN Digital. As WBD looks to leverage this new segment of the streaming market, WBD stock could be in focus.
Honda and General Motors Looking To Develop Three New EV Platforms Through 2030; Honda Reveals Plans To Launch EV In Japan By 2024
Meanwhile, Honda (NYSE: HMC) and General Motors (NYSE: GM) are making aggressive strides on the electric vehicle (EV) front now. As of earlier today, these two automotive industry titans are making new dedicated EV platforms. They aim to develop three of such platforms by 2030 through a series of joint initiatives. Furthermore, Honda’s global head of electrification, Shinji Aoyama also provided some insight into Honda’s EV launch plans. According to Aoyama, the company is looking to introduce a mini EV in Japan in 2024. In turn, it aims to follow this up with a full-sized commercial EV in North America by 2026.
At the same time, GM is also helping Honda develop and build two premium electric SUVs in the same region. For now, these two EVs are slated for release in North America by 2024. Through their current partnerships, Honda will be employing GM’s cutting-edge Ultium battery tech across these EVs. In the larger scheme of things, all this would serve to further advance Honda’s EV goals. The likes of which include plans to build two million EVs globally through 2030. With Honda eyeing global markets ranging from North America to China and Japan, things could be heating up for HMC stock.