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US Equity Futures Mixed Pre-Bell as Broadcom Falls, Clashes Continue in Middle East

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US equity futures were mixed pre-bell Thursday as traders watched tech giant Broadcom's (AVGO) stock drop after the company posted its fiscal Q2 financial results and attacks continued in the Middle East.

Dow Jones Industrial Average futures were 0.9% higher, S&P 500 futures were down 0.4%, and Nasdaq futures were 1.2% lower.

Broadcom shares were down 15% in premarket activity as the company issued below-consensus guidance for fiscal Q3 AI-chip revenue.

Kuwait reported that an Iranian missile and drone strike hit the country's international airport, killing one person and injuring dozens more. Iran claimed that it launched a retaliatory attack on US military bases in Kuwait after an earlier set of airstrikes by US forces.

Traders also digested the latest round of earnings, with CrowdStrike (CRWD) posting higher fiscal Q1 adjusted earnings and revenue.

Oil prices were lower, with front-month global benchmark North Sea Brent crude down 3% at $94.89 per barrel and US West Texas Intermediate crude 3.2% lower at $92.97 per barrel.

The weekly jobless claims bulletin, released at 8:30 am ET, showed 225,000 new unemployment claims for the week ended May 2, compared with the downwardly revised figure of 212,000 in the prior week, and it came in above the 215,000 expected, according to estimates compiled by Bloomberg. Q1 nonfarm productivity increased at a 0.3% annual rate, below forecasts for 0.4%, while unit labor costs increased 1.8%, compared with the 2.4% expected.

Federal Reserve Richmond President Thomas Barkin and San Francisco President Mary Daly are slated to speak on Thursday.

In other world markets, Japan's Nikkei closed 1.4% lower, Hong Kong's Hang Seng ended 1.5% lower, and China's Shanghai Composite finished 0.6% lower. Meanwhile, the UK's FTSE 100 was down 0.2%, and Germany's DAX index was 0.6% higher in Europe's early afternoon session.

In equities, CrowdStrike stock was down 10% after the company reported its fiscal Q1 financial results. ARM (ARM), Micron Technology (MU), and Marvell Technology (MRVL) shares were all down as part of a broader stock sell-off in the semiconductor industry. ARM shares fell 6%, Micron stock was down 6.4%, and Marvell shares dropped 5.9%.

On the winning side, Eli Lilly (LLY) was up 1.3% after Ascidian Therapeutics said the company will receive exclusive, target-specific rights to Ascidian's RNA exon editing technology for undisclosed kidney disease targets in exchange for up to $1.9 billion under a new research partnership and licensing agreement. Costco Wholesale (COST) shares rose 2.3% after the company reported net sales of $24.01 billion for May, up from $20.97 billion a year earlier. RTX (RTX) stock was up 2.2% after the company said that its Raytheon unit was awarded a $515 million contract from the US Navy for the SPY-6 family of radars.

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Asia Markets

Exchange-Traded Funds Lower as US Equities Fall After Midday

Broad Market IndicatorsBroad-market exchange-traded funds IWM and IVV were lower. Actively traded Invesco QQQ Trust (QQQ) eased 0.5%.US equity indexes declined while crude oil futures jumped as Iran struck Gulf nations Kuwait and Bahrain with missiles amid faltering diplomacy with Washington.EnergyIShares US Energy ETF (IYE) and the State Street Energy Select Sector SPDR (XLE) each added about 2.2%.TechnologyThe State Street Technology Select Sector SPDR ETF (XLK) was 1.3% lower; iShares US Technology ETF (IYW) lost 1.1%, and iShares Expanded Tech Sector ETF (IGM) was down 1%.The State Street SPDR S&P Semiconductor (XSD) climbed up 1%, and iShares Semiconductor (SOXX) rose 1.3%.FinancialThe State Street Financial Select Sector SPDR (XLF) fell 1.2%. Direxion Daily Financial Bull 3X Shares (FAS) declined 3.7%, and its bearish counterpart, Direxion Daily Financial Bear 3X Shares (FAZ), climbed up 3.6%.CommoditiesCrude oil rose 2.3%, and the United States Oil Fund (USO) added 2.3%. Natural gas gained 1.9%, and the United States Natural Gas Fund (UNG) was up 2%.Gold on Comex fell 1.2%, and the State Street SPDR Gold Shares (GLD) was down 1.1%. Silver slipped 2.7%, and iShares Silver Trust (SLV) lost 2.5%.ConsumerThe State Street Consumer Staples Select Sector SPDR (XLP) rose 0.9%. The Vanguard Consumer Staples ETF (VDC) added 1%, and iShares Dow Jones US Consumer Goods (IYK) gained 1%.The State Street Consumer Discretionary Select Sector SPDR (XLY) shed 1.1%. VanEck Retail ETF (RTH) eased 0.1%, and the State Street SPDR S&P Retail (XRT) fell 1.1%.HealthcareThe State Street Health Care Select Sector SPDR (XLV) rose 1%, iShares US Healthcare (IYH) added 1%, and Vanguard Health Care ETF (VHT) was up 1%. IShares Biotechnology ETF (IBB) advanced 1.3%.IndustrialThe State Street Industrial Select Sector SPDR (XLI) gained 0.3%. Vanguard Industrials Index Fund (VIS) eased fractionally, while iShares US Industrials (IYJ) dipped 0.3%.CryptocurrencyIn midday activity, bitcoin (BTC-USD) dropped 2.1%. Among cryptocurrency ETFs, ProShares Bitcoin ETF (BITO) fell 2.1%, ProShares Ether ETF (EETH) shed 4.5%, and ProShares Bitcoin & Ether Market Cap Weight ETF (BETH) was 2.4% lower.

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Asia Markets

Swiss Market Index Drops as US-Iran Ceasefire Hopes Fade

The Swiss Market Index ended Wednesday trading 0.66% lower after the US and Iran exchanged fresh strikes overnight, dampening investor sentiment and casting doubt on the prospects for a temporary peace deal.The US Central Command said US forces launched "self-defense strikes" on Qeshm Island in the Strait of Hormuz "in response to attempted attacks by Iran across the Middle East." It added that Tehran fired missiles at Kuwait and Bahrain, which broke apart or were immediately intercepted. Meanwhile, Iran's foreign ministry "strongly condemned" the US attack on the Iranian tanker and Qeshm, Bloomberg News reported.In trade news, Switzerland is one of the 60 countries facing additional US tariffs following an investigation into imports of goods allegedly made with forced labor. The proposed additional duties range from 10% to 12.5%."[The] results of this investigation indicate that the acts, policies and practices of Switzerland related to the failure to impose and effectively enforce a forced labor import prohibition are unreasonable and burden or restrict U.S. commerce," according to a report by the US Trade Representative.On the corporate front, Partners Group (PGHN.SW) is limiting withdrawals at its $8.6 billion Global Value SICAV fund to 5% of net asset value per quarter, following a surge in redemption requests in the second quarter, Bloomberg News reported, citing a letter to investors it saw. The private equity firm sank 16.33% at close.Meanwhile, Nestlé (NESN.SW), which owns a 49% stake in yfood Labs, agreed to buy the remaining stake in the smart food brand from its founders for an undisclosed sum. The share transfer is expected July 3, subject to customary approvals. The food and beverage giant was down 0.62%.The Swiss government is due to release inflation and labor data on Thursday.

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Asia Markets

German Shares Retreat Amid US-Iran Clashes, Fresh Tariff Threats

Germany's blue-chip DAX index closed 1.31% lower on Wednesday, amid reignited tensions in the Middle East and new tariff warnings from the US.Deutsche Bank Research noted "increasing pessimism" over a swift US-Iran agreement to reopen the Strait of Hormuz following overnight hostilities. The escalations involved US strikes on Qeshm Island and reciprocal Iranian missile and drone deployments targeting Kuwait and Bahrain."Prior to that, we saw little sign yesterday of concrete steps towards an imminent deal... This backdrop means [West Texas Intermediate] crude is now $7 [per barrel] above Friday's close, with a +0.92% rise at $94.62/bbl overnight," Deutsche Bank wrote.On the trade front, Washington proposed new 10% to 12.5% tariffs on 60 economies, including the European Union, following an investigation into the import of goods allegedly produced with forced labor.Back home, final business survey data showed that Germany's private sector remained in contraction territory for a second consecutive month, as surging cost pressures and muted demand further eroded service sector activity. S&P Global said the final Germany Composite PMI Output Index ticked up to 48.8 in May from 48.4 a month ago, surpassing the flash estimate of 48.6 but remaining below the 50-point neutral mark. Final services PMI was 48.1, against the preliminary estimate of 47.8 and the prior month's 46.9."Demand for services continues to be stifled by a squeeze on spending power from the increased cost of energy and heightened levels of uncertainty, although, encouragingly, the rates of decline in business activity and new work eased, offering hope that any downturn in the economy in Q2 would be only modest," S&P Global Market Intelligence economics associate director Phil Smith said.On the corporate side, Bloomberg reported comments from Deutsche Bank (DBK.F) Chief Financial Officer Raja Akram, who said the German lender anticipates second-quarter credit loss provisions to come in slightly above market expectations. Speaking at an investor conference, Akram clarified that the 100 million-euro provision for the three months through June still represents a sequential drop compared with the first quarter. Deutsche Bank was down 3.65% at closing.

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