|Delayed - 03/05 05:15:59 pm|
ETF Preview: ETFs, Futures Slip Lower Ahead of Powell Conference, Fed Monetary Policy Announcement
|01/27/2021 | 07:11am|
Stock futures were also in the negative territory ahead of Federal Reserve Chairman Jerome Powell's press conference at 2:30 pm ET; before that, the central bank's two-day policy meeting will conclude with an announcement at 2 pm ET.
On the economic calendar is the December durable goods orders bulletin at 8:30 am ET, with pundits expecting a strong report. The analyst consensus from Econoday is for new orders to have increased 1.0% compared with the prior month's 0.9%. Core capital goods are projected to have grown 0.4%, steady with the previous month.
The Atlanta Fed Survey of Business Uncertainty for January will be issued at 11 am ET. Also out at this time will be the January US State Street Investor Confidence Index, which measures confidence by looking at actual levels of risk in investment portfolios.
Microsoft (MSFT) logged gains pre-bell after posting a strong Q2 earnings report late Tuesday. Meanwhile, Starbucks (SBUX) shares slipped lower in the after hours after reporting declines in both top and bottom lines for Q1.
AT&T (T), Boeing (BA), Blackstone (BX), Automatic Data (ADP), Abbott Laboratories (ABT) and Anthem (ANTM) will report earnings in this premarket session, among others. Looking ahead, Apple (AAPL), Facebook (FB) and Tesla (TSLA) will post their financial results after the closing bell later.
Power Play: Technology
Technology Select Sector SPDR ETF (XLK) was up 0.1% and iShares Dow Jones US Technology ETF (IYW) and iShares S&P North American Technology ETF (IGM) were inactive.
Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was inactive and Semiconductor Sector Index Fund (SOXX) was down 0.8%.
As mentioned, Microsoft (MSFT) reported after markets closed Tuesday fiscal Q2 earnings, with EPS of $2.03, up from $1.51 a year earlier. That result exceeded the $1.64 average estimate of analysts polled by Capital IQ. The software giant said its revenue totaled $43.08 billion for the three months ended Dec. 31, up from $36.91 billion a year earlier. That result also surpassed the consensus estimate of $40.23 billion. Shares rose nearly 2%.
Winners and Losers
Select Financial Sector SPDR (XLF) was down 1.5%. Direxion Daily Financial Bull 3X Shares (FAS) was down some 2% and its bearish counterpart Direxion Daily Financial Bear 3X Shares (FAZ), up 0.4%.
Capital One Financial (COF) Tuesday after the close reported Q4 adjusted EPS of $5.29, compared with $2.49 a year earlier. The consensus estimate compiled by Capital IQ was for adjusted EPS of $2.74. Total net revenue fell to $7.34 billion during the three months ended Dec. 31 compared with $7.43 billion during the year-ago period. The CapIQ consensus was for revenue of $6.91 billion. Capital One also said that its board has authorized a new $7.5 billion stock buyback program. Shares rose more than 5%.
Select Sector SPDR-Industrial (XLI) fell 1%; iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), and Vanguard Industrials (VIS) were quiet in pre-market trading.
Plug Power (PLUG), an electrical equipment manufacturing company, on Tuesday priced its upsized offering of 28 million common shares at $65 per share. Underwriters have a 30-day option to buy up to an additional 4,200,000 common shares.
The offering is expected to close on or about Jan. 29. Shares fell more than 9%.
Dow Jones US Energy Fund (IYE) was down 2% and Energy Select Sector SPDR ETF (XLE) was down 1% in premarket trading.
SunPower (SPWR) said Tuesday it will expand to seven new markets across six states by the end of Q2 in a bid to grow its residential installation program footprint this year. The company plans to hire more than 300 technicians in 2021 and to complete twice as many installs year-over-year, according to a statement. The company is targeting several cities including Tucson, Orlando and Ft. Lauderdale. Shares were down 3%.
Crude oil was up 0.2% and the United States Oil Fund (USO) was 0.1% higher. Natural gas was up more than 2% and the United States Natural Gas Fund (UNG) was up nearly 2%.
Gold was down 0.5% and SPDR Gold Trust (GLD) was down 0.7%. Silver was down 1%, and iShares Silver Trust (SLV) fell more than 1%.
Health Care SPDR (XLV) was down 0.2% and other health care funds iShares Dow Jones US Healthcare (IYH) and Vanguard Health Care ETF (VHT) were quiet. iShares NASDAQ Biotechnology Index (IBB) was down 0.5%.
Agios Pharmaceuticals (AGIO) said a global phase 3 trial of mitapivat in 27 adults with Pyruvate Kinase deficiency demonstrated a "statistically significant and clinically meaningful reduction in transfusion burden." The company said 37% of patients achieved more than 33% reduction in transfusion burden compared with individual historical transfusion burden standardized to 24 weeks, according to a statement. It noted 22% were transfusion-free during the 24-week fixed-dose period.
The firm expects to file for regulatory approval in the US in Q2 and in the European Union in mid-2021. Shares were down 0.5%.
Consumer Staples Select Sector SPDR (XLP) was up 0.8%, Vanguard Consumer Staples ETF (VDC) and iShares Dow Jones US Consumer Goods (IYK) were inactive.
Consumer Discretionary Select Sector SPDR (XLY) was down 0.1%. Market Vectors Retail ETF (RTH) was flat while SPDR S&P Retail (XRT) was up more than 4%.
Starbucks (SBUX) shares fell some 3% after it reported late Tuesday a decline in adjusted EPS and revenue for its fiscal Q1 ending December 27. The company posted adjusted EPS of $0.61, down from $0.79 from a year earlier. The consensus estimate of analysts was for adjusted EPS of $0.55, according to Capital IQ. Total revenue was down 5% to $6.75 billion, from $7.1 billion. The consensus was for revenue of $6.92 billion. Comparable store sales were down 5% in the US, the company said. Analysts were expecting a decline of 4%. For fiscal 2021, the company expects adjusted EPS of $2.70 to $2.90. The consensus estimate for non-GAAP EPS is $2.82, according to Capital IQ. For Q2, Starbucks estimates non-GAAP EPS in the range of $0.45 to $0.50 per share. The consensus is for adjusted EPS of $0.59.