Friday Morning Reads
- A Rare Online Revolt
- The Biggest Threat to Space
- Blue Collar Boom
- U.S. Payroll Gains Seen Picking Up
- PG&E Has a Survival Plan
- Put Your Smaller Bonus to Better Use
- Tesla Tesla Tesla…Nasdaq 10,000 Is So Close!
- Simple vs. Complex, 2019 Edition
- Job growth swells in January
- AbbVie +4% premarket on Q4 and guidance beat
- GE upgraded from Sell by longtime bear
- Boeing's Starliner test nearly 'catastrophic' failure, NASA says
- Baird likes drug wholesalers in premarket analyst action
- Foxconn delays return to Shenzhen facility
- Marvell -2.9% after two-notch downgrade on 5g
- Goldman expects dividend all-stars to outperform
- 'Friends' reunion special in the cards
- Shell pushes to power with plans for first big solar plant
- Brookfield Asset Management closes $20B infrastructure fund
- Ford to name new COo
Climbing to all-time highs in the previous session on China's decision to halve tariffs on a slew of U.S. products, U.S. stock index futures slipped 0.4% overnight following a four-day winning streak on Wall Street. The big news today is January's jobs report, which will likely show a net increase of 160,000 jobs and for the unemployment rate to stay flat at 3.5%. Wage data will also be closely watched for any signs of potential inflation pressures, which could then translate into a fuller response from the Federal Reserve. For longer-term context, keep an eye on revisions to employment in the 12 months through March 2019, when the trade war with China was in full force.
Economic impacts of coronavirus
Due to the ongoing coronavirus outbreak, China has delayed trade figures for January and said it would combine the data with next month's release. The epidemic has also led to growth forecasts being cut, with S&P Global Ratings revising its estimation of China's GDP growth for 2020 from 5.7% before the outbreak to 5%. "Coronavirus will have a larger negative effect on the global economy than the SARS outbreak," added IHS Markit, explaining that China accounted for 4.2% of the global economy in 2003 vs. 16.3% of the world's GDP today.
Thiam gets the boot at Credit Suisse
Pressure over a widening spying scandal has weighed over Credit Suisse (NYSE:CS) for months, denting the bank's reputation and prompting difficult questions about the culture at the top of the firm. Looking to move past the damaging period, CEO Tidjane Thiam has announced his resignation despite being cleared in an internal probe and receiving the backing of key shareholders. He'll be replaced by Thomas Gottstein, a 20-year veteran of the bank who leads the Swiss unit.
Go deeper: Labutes IR says Credit Suisse is moving in the right direction.
SpaceX (SPACE) is likely to spin off its satellite-based broadband business and pursue an IPO, according to COO Gwynne Shotwell. The company has been launching Starlink satellites in batches of 60 since May (there's currently 240 orbiting Earth) and aims to make its broadband internet service operational by the end of 2020. Last year, Morgan Stanley set a bull case valuation of $120B on SpaceX (Starlink satellite and rocket business), which could also give a boost to Virgin Galactic (NYSE:SPCE).
Go deeper: Boeing's Starliner test nearly a 'catastrophic' failure.
After slashing its IPO share price to $12 (from an original range of $17 to $19), Casper (CSPR) climbed 13% yesterday to finish the session at $13.50 (with a market cap of $575M). The online mattress startup had been valued at $1.1B by private investors last year, but that was before the five-year-old company revealed in January that it lost $67M on $312M in revenue in the first nine months of 2019. Casper's lower IPO valuation was just a moment in time, said CEO Philip Krim, adding that, "our business is not what investors are used to seeing at this scale."
Russia is supporting a recommendation to deepen OPEC+ oil supply curbs amid falling demand for crude as China battles a coronavirus outbreak. The proposal could lead to a provisional cut in output of 600,000 barrels per day, which is about 0.6% of global supply and would extend current curbs of 1.7M bpd. It would also pave the way for OPEC to bring forward to February a ministerial policy meeting planned for early March to formalize the decision.
Risk of recession returns to Germany
The manufacturing slump continues in Germany as industrial production fell by 3.5% M/M in December, a day after factory orders were shown to have declined at the fastest pace in more than a decade. That suggests Europe's largest economy may have contracted at the end of 2019. Germany has already been pummeled by trade tensions, Brexit and climate change regulation engulfing its auto industry, and the latest data will likely dampen budding optimism of a recovery.
Uber's (NYSE:UBER) stock rose 6% in extended trading on Thursday after announcing a fourth-quarter loss that was narrower than analysts had expected. The firm also moved its EBITDA profitability target to Q4 2020, ahead of its original promise of profitability in 2021. "2020 is going to be the year of subscriptions at Uber," added CEO Dara Khosrowshahi, noting that when a user tries at least two different company services, like ridesharing and food delivery, they triple their overall usage of Uber.
Go deeper: 'Uber: Selling Eats Won't Solve Problem' by Stone Fox Capital.
The U.S. should neutralize a threat of Huawei's next-generation equipment by taking a controlling stake in Nokia (NYSE:NOK) or Ericsson (NASDAQ:ERIC), according to U.S. Attorney General William Barr. "There are only two companies that can compete with Huawei right now... putting our large market and financial muscle behind one or both of these firms would make it a more formidable competitor." The stance is dismissive of recent White House efforts to blunt Huawei's threat by investing in homegrown 5G equipment - signaling a split between government approaches.
ViacomCBS (NASDAQ:VIAC) is taking steps to make programming across the media company's properties available through one video-streaming offering, CNBC reports. Plans aren't final, but the new, bigger service might offer not only what's part of CBS All Access, but also (with the merger complete) Viacom assets such as Paramount films and its TV networks (Nickelodeon, Comedy Central, MTV, BET and Pluto TV). The service would come in an ad-free version, along with a premium paid version that would include Showtime.
What else is happening...
eBay (NASDAQ:EBAY) slides after Intercontinental Exchange (NYSE:ICE) backs away.
Warner Bros. (NYSE:T) finalizes a Friends reunion special.
Match (NASDAQ:MTCH) approaches Meet (NASDAQ:MEET) with takeover offer - Bloomberg.
Jury orders Johnson & Johnson (NYSE:JNJ) to pay $750M in talc case.
Transformation sees Aurora Cannabis (NYSE:ACB) CEO step down.
Warner Music Group files for initial public offering.
Google (GOOG, GOOGL) is tripling its Canadian workforce.
Elliott Management builds $2.5B stake in SoftBank (OTCPK:SFTBY).
Activision Blizzard (NASDAQ:ATVI) +2.4% AH on robust holiday quarter.
Bristol-Myers (NYSE:BMY) +2.3% topping estimates.
Pinterest (NYSE:PINS) +17% AH amid Q4 user metric beats.
Philip Morris (NYSE:PM) +2.7% beating expectations.
Regeneron (NASDAQ:REGN) +4.8% on strong Q4 results.
Uber (UBER) +5.6% AH guiding earlier EBITDA profitability.
T-Mobile (NASDAQ:TMUS) +1% AH adding 1M phone subscribers.
Twitter (NYSE:TWTR) +15% on strong user growth.
Wynn Resorts (NASDAQ:WYNN) -1.6% AH following an EBITDA miss.
In Asia, Japan -0.2%. Hong Kong -0.3%. China +0.3%. India -0.4%.
In Europe, at midday, London -0.6%. Paris -0.3%. Frankfurt -0.5%.
Futures at 6:20, Dow -0.4%. S&P -0.4%. Nasdaq -0.5%. Crude -0.1% to $50.91. Gold +0.2% to $1572.50. Bitcoin +1.7% to $9811.
Ten-year Treasury Yield -5 bps to 1.6%Today's Economic Calendar
8:30 Non-farm payrolls
10:00 Wholesale Trade
1:00 PM Baker-Hughes Rig Count
3:00 PM Consumer Credit