Major Development in U.S. Auto Sector
U.S. stock futures are mostly unchanged before the last trading day of an eventful week. This week, the market’s benchmark – the S&P 500 Index – exited from a bear market since October 2022 and formed a new bull market.
The broad-market index is heading for its fourth straight positive week. The Dow aims to close on a positive note for the second consecutive week. However, the tech-heavy \Nasdaq Composite, which has witnessed an impressive rally so far this year, is on pace to break a six-week winning streak.
In a major development in the auto sector, General Motors Co. GM announced its plan to enter into an agreement with Tesla Inc. TSLA to leverage the latter’s electric vehicle Supercharger Network. Ford Motor Co. F had entered into a similar kind of agreement with Tesla two weeks ago.
Internationally, the Producer Price Index in China fell 4.6% year-over-year in May after declining 3.6% in April. On a year-over-year basis, this was the biggest monthly decline in seven years. China’s Consumer Price Index rose marginally by 0.2% year-over-year in May.
This situation is in sharp contrast to the rest of the world where leading central banks including the Fed have been struggling for the past one and half years to combat record-high inflation. China – the second largest economy of the world – is yet to recover from its strict COVID-19 restrictions. Earlier this week, China reported that the country’s exports dropped 7.5% year-over-year in May. This indicates lack of global demand for Chinese goods that are highly appreciated for their cheap price.
Yesterday, after the closing bell, business services provider DocuSign Inc. DOCU came up with quarterly earnings of $0.72 per share, beating the Zacks Consensus Estimate of $0.53 per share. This compares to earnings of $0.38 per share a year ago. These figures are adjusted for non-recurring items. The company posted revenues of $661.39 million for the quarter ended April 2023, surpassing the Zacks Consensus Estimate by 3.16%.
Vail Resorts Inc. MTN came up with quarterly earnings of $8.18 per share, missing the Zacks Consensus Estimate of $8.88 per share. This compares to earnings of $9.16 per share a year ago. These figures are adjusted for non-recurring items. The company posted revenues of $1.24 billion for the quarter ended April 2023, missing the Zacks Consensus Estimate by 0.58%. This compares to year-ago revenues of $1.18 billion.
Meanwhile, investors are keenly waiting for Fed’s June FOMC meeting scheduled next week. The CME FedWatch tool is currently showing there exists 78.2% probability that the central bank will keep the benchmark lending rate at 5-5.25%. However, 21.8% respondents are expecting a 25 basis-point hike in June.
Inflation has declined to a great extent from its June 2022 level though it remains highly elevated. Several key economic metrics have declined steadily in the past year. However, the key labor market remained stubbornly resilient. This makes market participants indecisive about the Fed’s next move regarding interest rate.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>Ford Motor Company (F) : Free Stock Analysis Report
General Motors Company (GM) : Free Stock Analysis Report
Tesla, Inc. (TSLA) : Free Stock Analysis Report
Vail Resorts, Inc. (MTN) : Free Stock Analysis Report
DocuSign (DOCU) : Free Stock Analysis Report
