U.S. stock futures were fractionally higher early Monday ahead of a week with several anticipated events in the ongoing fight against inflation.
Futures for the Dow Jones Industrial Average added 50 points, or 0.15%. Those for the S&P 500 and Nasdaq 100 edged 0.2% and 0.26% higher, respectively.
The move in futures comes as investors will be focused on inflation this week. On Tuesday, the November consumer price index will be released, and traders will be looking for a sign that inflation is slowing.
The Federal Reserve has a two-day meeting starting the same day. The central bank is expected to announce another rate hike on Wednesday, though traders are anticipating a smaller move than in recent months.
In addition to the expected rate hike, the Fed’s updated economic projections and Chair Jerome Powell’s press conference could be key signals for what the central bank wants to do in the coming months.
“Financial conditions have eased dramatically since the October CPI reading released last month, so the Fed will likely use the December FOMC meeting to walk those back,” said Cliff Hodge, chief investment officer for Cornerstone Wealth. “We think the markets are too sanguine on rates after the first quarter and we expect Powell to take a more hawkish tone and for the dots to indicate higher rates for a longer period of time than what is currently being priced in by the futures markets.”
Wall Street is coming off a rocky week that saw all three major averages lose ground. The Dow fell 2.77% for its worst week since September. The S&P 500 dropped 3.37%, while the Nasdaq Composite shed 3.99%.
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Coupa Software (COUP) – Private-equity firm Thoma Bravo agreed to buy Coupa, a specialist in business spending management software. The deal is worth $8 billion, or $81 per share in cash. Coupa shares soared 21.6% in premarket trading.
STOCK SYMBOLS: COUP
Rivian (RIVN) – The electric vehicle maker has paused talks with Mercedes-Benz on a planned joint venture to build electric vans in Europe. The move is part of Rivian’s effort to be more conservative with its cash outlays in the face of higher interest rates and economic concerns. Rivian fell 2.5% in premarket action.
STOCK SYMBOLS: RIVN
Weber (WEBR) – The maker of grills and other outdoor cooking products agreed to be taken private by BDT Capital Partners for $2.32 billion in cash, or $8.05 per share. Weber shares closed Friday at $6.50.
STOCK SYMBOLS: WEBR
Accenture (ACN) – Accenture fell 1.7% in the premarket after Piper Sandler downgraded the consulting firm’s stock to “underweight” from “neutral.” The firm expects Accenture to be negatively impacted by more cautious 2023 spending in the tech sector.
STOCK SYMBOLS: ACN
Under Armour (UAA) – Under Armour jumped 2.8% in premarket trading following a Stifel upgrade to “buy” from “hold.” Stifel praised the athletic apparel maker’s inventory management, which it said gives the company better profit margin certainty.
STOCK SYMBOLS: UAA
Best Buy (BBY) – The electronics retailer’s stock added 1.6% in the premarket after Goldman Sachs upgraded it to “neutral” from “sell.” It’s among retail stocks that Goldman feels has the ability to maintain prices as inflation moderates and to gain market share.
STOCK SYMBOLS: BBY
Gap (GPS), Tapestry (TPR), Levi Strauss (LEVI) – Goldman Sachs upgraded Gap and Tapestry to “buy” from “neutral” while downgraded Levi Strauss to “neutral” from “buy.” Goldman said its moves were based on which companies can thrive in an atmosphere that will see consumers become more discerning with their apparel spending. Gap added 2.7% in the premarket, with Tapestry up 2% and Levi Strauss losing 1.2%.
STOCK SYMBOLS: GPS
Brinker International (EAT) – The restaurant operator’s stock slid 3.7% after Goldman downgraded it to “sell” from “neutral.” Goldman said it was cautiously optimistic about the long-term results of the company’s effort to turn around its Chili’s chain, but thinks 2023 will be choppy in terms of sales and profit margins.
STOCK SYMBOLS: EAT
FULL DISCLOSURE:
/u/bigbear0083 has no positions in any stocks mentioned. Reddit, moderators, and the author do not advise making investment decisions based on discussion in these posts. Analysis is not subject to validation and users take action at their own risk.
DISCUSS!
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 Monday, December 12th, 2022! 🙂
