Stock market index futures were pointed higher on Tuesday ahead of quarterly earnings reports from big U.S. banks that could provide clues of America’s expectations for the pace of an economic recovery, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
JPMorgan Chase & Co. (NYSE: JPM) opened Tuesday’s quarterly earnings by beating Wall Street expectations and infusing more hope of a faster economic recovery (see more below).
Fellow big bank Wells Fargo Co. (NYSE: WFC), however, reported a $2.4 billion quarterly loss and trimmed its dividend payment to shareholders to $0.10 per share.
An upbeat second-quarter report from PepsiCo Inc. (Nasdaq: PEP) lifted Wall Street early on Monday, but the S&P 500 and Nasdaq ended lower on new coronavirus restrictions in California and renewed tensions between the U.S. and China.
Investors are bracing for what could be the sharpest decline in quarterly earnings for S&P 500 companies since the 2008 financial crisis, according to Refinitiv IBES data.
Tensions between Washington and Beijing escalated after the U.S. rejected China’s disputed claims to offshore resources in most of the South China Sea. The Trump administration also plans to scrap a 2013 auditing agreement that could lead to a stronger crackdown on U.S.-listed Chinese companies.
As of 9:15 a.m., Dow Jones futures were 0.14% higher. S&P 500 futures fell 0.24% and Nasdaq futures were down 0.91%.
Stocks to Watch Today
Delta Air Lines Inc. (NYSE: DAL) — The major airline carrier reported a net loss of $5.7 billion in the second quarter as its revenue dropped 88% from a year ago. On a per-share basis, Delta lost $4.43, above the forecasted $4.07 per share. Delta Airlines was trading down 1.1%.
JPMorgan Chase & Co. (NYSE: JPM) — Shares of the American investment bank jumped nearly 2% after reporting a second-quarter profit bolstered by a 79% surge in trading revenue. The company’s profits were trimmed as it set aside $8.9 billion for expected loan losses across the firm.
Boeing Co. (NYSE: BA) — The American aircraft manufacturer was awarded a U.S. Air Force contract to build at least eight F-15EX fighter jets worth potentially $1.2 billion. With the possibility of infinite delivery, the total contract value could top $23 billion. Shares of Boeing were up 2.6%.
Swedish Oat-Milk Company Draws Investment from Blackstone-Led Group
Oatly AB, a Swedish oat-milk maker has sold a $200 million stake to a group led by Blackstone Group Inc. (NYSE: BX) that includes Oprah Winfrey, Natalie Portman, former Starbucks Corp. (Nasdaq: SBUX) chief Howard Schultz and the entertainment company founded by Jay-Z.
According to The Wall Street Journal, the company’s sale of the 10% stake values it at $2 billion.
The sale of the stake is a key step in its path toward a potential initial public offering, which could come sometime over the next 12 to 18 months. Oatly could also be an acquisition target for a larger food conglomerate.
Google Eyeing $4 Billion Investment in Jio Platforms
Alphabet Inc. (Nasdaq: GOOG) subsidiary Google is looking to join several Silicon Valley companies by investing in Reliance Industry Ltd.’s digital arm, Jio Platforms Ltd.
According to Bloomberg, the Indian-based company has already attracted nearly $16 billion in investments in just the last three months. Jio Platforms boasts nearly 400 million users through its wireless network.
Reliance has sold 25.2% of Jio, valuing the venture at $65 billion.
SoftBank May Return Arm Holdings to Public Markets
SoftBank Group Corp. is looking at options, including a full or partial sale or public offering of British chipmaker Arm Holdings.
The Japanese conglomerate purchased Arm Holdings for $32 billion four years ago, but SoftBank is under pressure to raise cash from its varied assets to stabilize losses, according to The Wall Street Journal.
SoftBank has said it plans to sell nearly $41 billion in assets to prop up its portfolio and buy back its own shares. It recently sold around $20 billion worth of T-Mobile US Inc. (Nasdaq: TMUS). It owns stakes in Alibaba Group Holding Ltd. (NYSE: BABA) and a Japanese cellphone provider.
What We’re Reading
Golden Ticket: The Precious Metal Surge Isn’t Over Yet (Money & Markets)
Tesla Scraps Plans for its Bargain Version of the Model Y (CNN Business)
Will the Fed’s Money Printing Trigger the Next Great Depression? (Money & Markets)
Earnings Report
Here are the companies releasing earnings reports today:
Citigroup Inc. (NYSE: C)
Delta Air Lines Inc. (NYSE: DAL)
Fastenal Co. (Nasdaq: FAST)
JPMorgan & Chase Co. (NYSE: JPM)
Wells Fargo & Co. (NYSE: WFC)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.