U.S. stock futures gave up gains from earlier in the day Wednesday, even after the release of strong quarterly results from Netflix.
Dow Jones Industrial Average futures were down 121 points, or 0.4%. S&P 500 and Nasdaq 100 futures traded lower by 0.5% each.
Netflix shares rallied 13% after the streaming giant posted earnings and revenue that beat estimates as well as strong subscriber growth for the third quarter. Other tech-related names such as Meta, Amazon and Microsoft traded higher in the premarket.
United Airlines, Intuitive Surgical and Procter & Gamble were among the other names rising in premarket trading after strong quarterly reports.
The solid start to earnings season comes as many on Wall Street have been resetting their earnings projections lower and investors are worried about a recession. Even though equities have rallied in the first two days of the week, Treasury yields remain high and were climbing on Wednesday, suggesting that recession fears are still intact.
“On the plus side, corporate earnings season may help investor confidence somewhat, just given current oversold conditions and reduced expectations. That should help equities keep their footing, but until we see 2-year and 10-year yields start to decline we think traders and investors should remain wary of expecting too much from this rally,” said Nick Colas of DataTrek Research.
Tech earnings will be in full swing next week, but IBM and Tesla are on deck to report Wednesday. Social media firm Snap will report later in the week.
In economic data, investors are looking forward to housing starts on Wednesday. The Federal Reserve’s so-called Beige Book, the central bank’s report on the current state of economic conditions, will come out as well.
Wednesday’s moves came after another strong day for stocks, with the Dow rallying about 337 points Tuesday and the S&P 500 gaining 1.1%.
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Procter & Gamble (PG) – The consumer products giant’s quarterly earnings of $1.57 per share beat estimates by 3 cents with revenue also topping Wall Street forecasts. Results were helped by a 7% boost in organic sales, although P&G cut its full-year revenue forecast due to the impact from a stronger US dollar. P&G rose 1.7% in the premarket.
STOCK SYMBOL: PG
Travelers (TRV) – Travelers added 1% in premarket trading after beating top and bottom line estimates for its latest quarter. The insurance company’s catastrophe losses rose from a year ago, but its results were helped by record insurance premiums.
STOCK SYMBOL: TRV
Generac (GNRC) – The power equipment maker released preliminary third-quarter results that fell below Wall Street forecasts. Generac said residential sales were pressured during the quarter, and its largest clean-energy customer ceased operations and filed for bankruptcy. Generac tumbled 16.8% in the premarket.
STOCK SYMBOL: GNRC
Nasdaq (NDAQ) – Nasdaq gained 1.5% in premarket action after reporting better-than-expected profit and revenue for the third quarter. Nasdaq saw strong demand for its various investment products as investors revamped portfolios in response to market volatility.
STOCK SYMBOL: NDAQ
Netflix (NFLX) – Netflix surged 12.2% in premarket trading after reporting it added 2.4 million subscribers during its latest quarter. That was more than twice the video streaming service’s prediction and reversed a trend that saw it lose subscribers for the past two quarters.
STOCK SYMBOL: NFLX
Adobe (ADBE) – The software maker’s stock rose 1.7% in the premarket after it reaffirmed its prior current-quarter outlook, encouraging investors who have seen other tech companies cut their forecasts as sales decline.
STOCK SYMBOL: ADBE
JB Hunt Transport (JBHT) – JB Hunt reported better-than-expected profit and revenue for its latest quarter, but the logistics company said it is preparing for a subdued holiday season as shipping volumes decline. JB Hunt added 2.5% in premarket action.
STOCK SYMBOL: JBHT
United Airlines (UAL) – United Airlines jumped 5.3% in premarket trading after reporting better-than-expected quarterly results and issuing an upbeat earnings forecast for the current quarter amid a continued surge in travel demand.
STOCK SYMBOL: UAL
Intuitive Surgical (ISRG) – Intuitive Surgical rallied 10% in off-hours trading after its quarterly earnings and revenue topped Wall Street forecasts. The medical equipment maker’s results were helped by a roughly 20% jump in the number of procedures performed with its da Vinci robotic surgical devices.
STOCK SYMBOL: ISRG
Interactive Brokers (IBKR) – Interactive Brokers rose 2.6% in the premarket after the company’ reported a 73% jump in net interest income and a 3% rise in commission revenue fro the quarter.
STOCK SYMBOL: IBKR
ASML (ASML) – ASML reported better-than-expected quarterly sales and profit, as the semiconductor manufacturing equipment maker managed to thrive despite an overall industry slowdown. ASML jumped 5.2% in premarket action.
STOCK SYMBOL: ASML
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What’s on everyone’s radar for today’s trading day ahead here at r/stocks?
I hope you all have an excellent trading day ahead today on this Wednesday, October 19th, 2022! 🙂