Morning Brief

As 5 Dow components report earnings, futures take off

Key Points


U.S. stock futures were higher this morning despite pressure coming from a sharp premarket decline in Google-parent Alphabet (GOOGL) after worse than expected second-quarter performance in per-click and traffic acquisition costs. (CNBC)

Alphabet, late Monday, also reported a steep drop in second-quarter profit due to a $2.74 billion fine European antitrust regulators levied on Google. But overall, Alphabet's adjusted earnings and revenue beat expectations. (CNBC)

The Nasdaq would need to overcome Alphabet's drop to add to Monday's record high close. The direction of the Dow and S&P 500, riding three session losing streaks, could depend on earnings from five Dow components this morning. (CNBC)

* Caterpillar jumps 5% on earnings beat (CNBC)
* McDonald's shares soar on earnings and revenue beats (CNBC)
* DuPont beats on strong demand in agriculture business (Reuters)
* United Technologies quarterly revenue rises 2.7% (Reuters)
* 3M beats on earnings, but misses on revenue (Press Release)

General Motors (GM) reported quarterly earnings and revenue that beat expectations. The automaker reported $3.5 billion in profits for North America, but its U.S. car sales are down more than 18 percent so far this year. (CNBC)

* After the bell: AT&T, Chipotle Mexican Grill (CMG), Advanced Micro Devices, and Amgen (CNBC)

Michael Kors (KORS) this morning agreed to buy for nearly $1.2 billion upscale shoe maker Jimmy Choo, whose shares in London trading were soaring about 17 percent. Current CEO Pierre Denis will continue to run Jimmy Choo after the sale closes. (CNBC)

An activist investor acquired a stake in Barnes & Noble (BKS) and is calling on the retailer to consider selling itself in order to unlock more value in the brick-and-mortar book business. Barnes & Noble shares were surging about 14 percent in the premarket. (CNBC)

Respondents to the CNBC Fed Survey have marked down their expectations for Fed rate increases and for fiscal policy stimulus from Congress and the Trump administration. And there's growing worry that the stock market could be set up for a fall.

The Fed kicks off its two-day July meeting this morning. No interest rate hike is expected when central bankers release their monetary policy statement tomorrow afternoon. The Fed increased rates in June for the second time this year. (CNBC Trading Nation)

* S&P/Case-Shiller's May home prices at 9 a.m. ET; July consumer confidence at 10 a.m. ET (CNBC)
* Oil prices rise for a second day after Saudis pledge to curb exports (Reuters)


Sen. John McCain, who was recently diagnosed with an aggressive brain tumor, returns to Washington today to give Republicans a crucial vote in support of a motion to proceed with debate on the GOP's health care legislation. (CNBC)

In a morning tweetstorm, Trump praised McCain as "brave" while again bashing Obamacare. The president also continued to criticize his Attorney General Jeff Sessions and to call for an investigation of what he calls "Hillary Clinton crimes." Trump also blasted what he called a Jared Kushner "witch hunt." (CNBC)

* Trump accuses The Washington Post of 'fabricating' facts in its US-Syria report (USA Today)

Trump's son-in-law and advisor Jared Kushner returns to Capitol Hill today for a second day of private meetings with congressional investigators looking into possible administration ties to Russia and Moscow's interference in the 2016 election. (AP)

* Kushner Day 1: I did not collude with Russia, my actions were 'proper' (CNBC)
* House expected to approve Russia sanctions bill limiting Trump's influence (Reuters)

China's privately held HNA Group awaits approval from U.S. regulators to complete its purchase of SkyBridge Capital, a New York investment fund founded by Anthony Scaramucci who recently became Trump's communications director. (CNBC)

After Facebook CEO Mark Zuckerberg's weekend criticism of Elon Musk's fears over the disruption of artificial intelligence and doomsday predictions, Musk tweeted early this morning that Zuckerberg's understanding of the future of AI is "limited." (CNBC)

* Nasdaq acquires a UK software firm that uses A.I. to sniff out rogue traders (CNBC)

Japan's SoftBank has reportedly approached Uber about buying a multibillion dollar stake. Talks were said to be preliminary and contingent on Uber hiring a new CEO. SoftBank already has investments in three ride-hailing companies in Asia. (WSJ)

SoftBank, Shell weigh bids for Asia renewables firm worth up to $5 billion (Reuters)


Eli Lilly (LLY) reported adjusted quarterly profit of $1.11 per share, 6 cents above estimates. Revenue was above forecast as well. The drugmaker raised its adjusted full-year forecast as well as its bottom line is boosted by the success of newer products.

PulteGroup (PHM) came in 6 cents above estimates with adjusted quarterly profit of 47 cents per share, though revenue was very slightly below forecasts. The third largest U.S. homebuilder sold more houses at higher prices and saw a 12.3 percent jump in new orders.

Centene (CNC) beat estimates by 27 cents with adjusted quarterly profit of $1.59 per share, with revenue also coming in above forecasts. The health insurer's bottom line was boosted by growth in its Obamacare business as well as increased enrollment in its Medicaid plans.


Goldman Sachs (GS) is pulling back from its market making activities in exchange-traded funds, according to the Wall Street Journal, which said the firm has slashed the number of funds it supports as a lead market maker.

Citigroup (C) will hold its first investor conference since the financial crisis today. About 250 analysts and investors will attend the meeting in New York, and the gathering will also be available online.

Toyota (TM) is developing an electric car that charges faster and drives further than current models, according to a Tokyo newspaper, with the company aiming to start selling the new vehicle in 2022.

Wal-Mart (WMT) has expanded its partnership with China-based e-commerce firm (JD). The two companies will expand integration of their platforms, supply chains, and customer resources in China.