U.S. stock market futures continued to rise on the back of a surprisingly upbeat jobs report last week which further added optimism that the world’s biggest economy has weathered the coronavirus outbreak, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Leading the gainers in premarket trading were shares of companies hammered by the coronavirus pandemic such as cruise line operators and airlines.
Carnival Corp. (NYSE: CCL), Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH), American Airlines Group Inc. (Nasdaq: AAL) and United Airlines Holdings Inc. (Nasdaq: UAL) climbed between 8.8% and 17.6%.
The tech-heavy Nasdaq closed just three points shy of its Feb. 19 all-time peak on Friday after a closely-watched monthly jobs report showed an unexpected fall in the unemployment rate.
The S&P 500 and the Dow Jones are now 5.7% and 8.3% below their respective closing records after surging more than 45% from their pandemic lows hit on March 23 as most businesses have now reopened after weeks of a shutdown to curb the spread of the virus.
This week’s centerpiece is the Federal Reserve’s two-day policy meeting, ending on Wednesday, where the jobs report is expected to be discussed.
As of 9:20 a.m. EDT, Dow Jones futures were up 0.9%. S&P 500 futures moved up 0.6% and Nasdaq composite futures moved 0.17% higher.
Stocks to Watch Today
Gilead Sciences Inc. (Nasdaq: GILD) — The American pharmaceutical company has reportedly been contacted by Britain’s AstraZeneca PLC (NYSE: AZN) about a potential mega merger. Shares of Gilead Sciences jumped 4.5% in premarket trading.
Thor Industries Inc. (NYSE: THO) — The recreational vehicle manufacturer beat Wall Street analysts’ expectations for earnings and revenue in the last quarter. The company reported quarterly profit of $0.43 per share, compared to expectations of a quarterly loss. Shares of Thor were up 4.8%.
PG&E Corp. (NYSE: PCG) — The investor-owned utility in California said it plans to raise $5.75 billion through public offerings of stock and equity units to help fund its way out of Chapter 11 bankruptcy protection. Shares of PG&E were down 1.7%.
Morgan Stanley Bets on Steepening US Yield Curve
Strategists at Morgan Stanley (NYSE: MS) are betting on a steeper yield curve in the wake of a surge in U.S. payrolls in May.
According to Bloomberg, the bank bet on the spread between three-year and 10-year yields widening to their “existing so-called steepening trade call — a wager on five-year, 30-year spreads.”
Ten-year yields jumped by nearly a quarter percentage point last week as bond investors have started to come around to the belief of a quicker recovery to the U.S. economy.
US Shale Companies Are Turning the Taps Back On
As the price of oil nears $40 a barrel, shale companies are bringing their wells back online, even as demand continues to struggle due to the coronavirus pandemic.
Companies including Parsley Energy Inc. (NYSE: PE) and WPX Energy Inc. (NYSE: WPX) have started to turn their current wells back on, but are putting off most new drilling, according to The Wall Street Journal.
Volumes remain below the peak levels before the pandemic when the U.S. was putting out 13 million barrels per day.
West Texas Intermediate crude oil futures were trading at $39.44 a barrel in premarket trading.
Nasdaq Overtakes NYSE in Coronavirus-Era IPOs
Nasdaq Inc. has moved past the New York Stock Exchange in initial public offerings this year as the coronavirus pandemic has limited activity on the NYSE trading floor.
Companies going public in 2020 have raised $12.2 billion in IPOs at Nasdaq, compared to $10.9 billion at the NYSE, according to The Wall Street Journal.
The Nasdaq edged ahead last week after Warner Music Group Corp. (Nasdaq: WMG) raised more than $1.9 billion in the largest IPO to date this year.
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Earnings Report
Here are the companies releasing earnings reports today:
Casey’s General Stores Inc. (Nasdaq: CASY)
Enzo Biochem Inc. (NYSE: ENZ)
Linx S.A. (NYSE: LINX)
Rev Group Inc. (NYSE: REVG)
Stitch Fix Inc. (Nasdaq: SFIX)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.
