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Tuesday, July 30

Some of the largest macro moves in the market today include: Copper -1.3%. Some of the largest moves among US mega-cap stocks include: Eli Lilly and Co (LLY) +1.2%.

The German economy unexpectedly contracted by 0.1% in the second quarter of 2024, reversing from a growth rate of 0.2% in Q1 and defying forecasts for continued expansion. This contraction highlights ongoing challenges within Germany's industrial sector due to high interest rates, contributing to broader concerns about economic stability across Europe.

In contrast, France reported stronger-than-expected GDP growth at an annualized rate of 1.3%, driven primarily by robust investment and export activities despite weaker household consumption figures for June that missed market expectations significantly with declines noted particularly in energy and food purchases.

Market participants are closely watching central bank decisions this week as both the Federal Reserve (Fed) and Bank of Japan (BoJ) prepare their monetary policy announcements on Wednesday amidst mixed global economic signals including resilient U.S labor markets but slowing consumer confidence indicators expected later today alongside key earnings reports from major tech companies like Microsoft which could influence future equity trends.

UUP [+0.3%]
The Invesco DB US Dollar Index Bullish Fund (UUP) has seen a slight price increase of 0.1% since Monday's market close. This movement coincides with traders' anticipation of the Federal Reserve's upcoming monetary policy decision, where interest rates are expected to remain unchanged but may hint at potential cuts starting in September due to easing inflation and labor market conditions. Additionally, geopolitical tensions have heightened demand for safe-haven assets like the U.S. dollar, driven by concerns over economic growth in China and its implications for global markets.

VanEck Semiconductor ETF (SMH) [+0.5%]
The VanEck Semiconductor ETF is moving higher in tandem with the broader market. Key contributors to this performance include AVGO, NVDA, TXN, LRCX, and QCOM, all of which have shown positive returns. Notably, NVIDIA has launched new tools for humanoid robot development, enhancing workflow efficiency, and has received approval for high-bandwidth memory chips from Samsung, marking a significant development in the AI memory chip sector. These movements among the ETF's holdings underscore its alignment with overall market trends.

DEO |-7.4%|-20.0B
Diageo PLC's stock price has dropped significantly in premarket trading, declining by 7.6% following the release of its recent results. This downturn is compounded by BofA Securities lowering its price target for the company to GBP26.00 from GBP30.00 while maintaining a Neutral rating. Additionally, social media reports indicate that Diageo shares fell by 10% in London, marking the company's first sales decline since the pandemic.

PYPL | +6.3% | +9.3B
PayPal Holdings Inc. reported strong second-quarter results, with adjusted earnings per share of 1.19, exceeding the consensus estimate of 0.98. Revenue reached 7.90 billion, surpassing expectations of 7.81 billion and marking an 8.41% year-over-year increase. Total payment volumes rose by 11% to 416.81 billion, driven by a 28% increase in unbranded card processing. The company raised its full-year adjusted profit forecast for FY2024 to a range of 3.88 to 3.98, up from a previous estimate of 3.65. Operating margins improved to 18.5%, addressing prior concerns. Following these results, PayPal's stock experienced notable upward momentum, rising by 8.2% in pre-market trading.

GLW |-7.7%|-2.6B
Corning Inc reported Q2 2024 earnings with an adjusted EPS of 0.47, slightly exceeding the consensus estimate of 0.46. Revenue was reported at 3.25 billion, falling short of the expected 3.54 billion, although core sales reached 3.60 billion, surpassing estimates. The Optical Communications segment performed well, driven by new optical connectivity products for generative AI. Following the earnings release, Corning set its Q3 FY2024 EPS guidance at 0.50-0.54 and revenue guidance at 3.7 billion. Despite these results, shares of Corning are trading lower, reflecting market concerns over the mixed financial outcomes and a Q3 revenue guidance that fell short of the consensus of 3.79 billion. The company's long-term revenue growth remains a concern, with a modest annualized growth rate over the past five years.

PG |-5.1% | -19.4B
Procter & Gamble reported fiscal Q4 earnings of $1.40 per share, exceeding the $1.37 estimate, while net sales reached $20.53 billion, falling short of the expected $20.74 billion and declining from $20.55 billion a year earlier. The results reflected reduced consumer spending in the U.S. and Europe, particularly impacting the beauty and home care segments. Organic sales growth was 2%, below the anticipated 3.43%. Notably, the company experienced market share losses in the baby-care category, prompting a revamp of its Luvs diapers, with organic sales in that segment declining significantly. The grooming segment saw a 7% increase in organic sales, and P&G projects organic revenue growth for FY2025 to be between 3% and 5%. Guidance for FY2025 EPS is set at $6.91 to $7.05, with revenue expectations of $85.7 billion to $87.4 billion.

HWM |+12.8%|+4.9B
Howmet Aerospace Inc. reported Q2 2024 earnings of $0.67 per share, exceeding the consensus estimate of $0.60 by 11.67%. Revenue reached $1.88 billion, surpassing the expected $1.84 billion and marking a year-over-year increase of 14.1%. For Q3, the company anticipates revenue between $1.845 billion and $1.865 billion, above the estimate of $1.81 billion, with adjusted EPS expected between $0.63 and $0.65. Additionally, Howmet has authorized a share repurchase program totaling $2.487 billion, reflecting a commitment to returning capital to shareholders. The stock has increased significantly in pre-market trading, moving higher alongside broader market trends and outperforming sector peers.

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