Stock Futures Inch Higher with Earnings, M&A in Focus

Some big names are in the headlines for M&A activity this morning

by Lillian Currens

Published on Nov 6, 2019 at 9:19 AM

Stock futures are signaling tentative gains today, after notching even more record highs yesterday. Dow futures are roughly 25 points above fair value, as traders weigh a surprise drop in third-quarter nonfarm productivity -- its biggest decline since 2015 -- against Tuesday's upbeat data on the services industry and jobs market. In the earnings spotlight is CVS Health (CVS), which is getting a pre-market boost on a well-received report, while there are also some big merger-and-acquisition headlines driving stocks this morning.

Continue reading for more on today's market, including: 

  • How the gamma-weighted SOIR can impact stock moves, according to Schaffer's Senior Quantitative Analyst Rocky White. 
  • 2 stocks slammed with post-earnings bear notes. 
  • Plus, Capri steps into the earnings confessional; Taylor Morrison acquires William Lyon; and buyout buzz sends HP stock higher. 

Futures Chart Nov 6

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw 1.23 million call contracts traded on Tuesday, compared to 711,548 put contracts. The single-session equity put/call ratio moved up to 0.58, while the 21-day moving average came in at 0.63.
  2. Michael Kors parent Capri Holdings Ltd (NYSE:CPRI) is down 1.7% in pre-market trading, after posting second-quarter earnings that missed analysts' estimates. The firm cited weakening sales for its Versace brand and the ongoing Hong Kong protests for its miss. 
  3. The shares of home builder William Lyon Homes (NYSE:WLH) are surging after Taylor Morrison (NYSE:TMHC) agreed to acquire the company in a cash-and-stock deal worth $2.4 billion, including debt. William Lyons stock is up 8.6% to trade just below $20 per share in electronic action, compared to the offer price of $21.45. The stock closed Tuesday at $18.40. TMHC is down nearly 9% ahead of the bell.
  4. A Wall Street Journal report that Xerox (NYSE:XRX) could launch a bid to take over HP Inc (NYSE:HPQ) has XRX down 5.1% and HPQ up 15.2% this morning. Supposedly, talks about a cash-and-stock offer were held by the Xerox board yesterday, and CNBC this morning is reporting that Xerox has actually made an offer to HP.
  5. Weekly crude inventories come out today. Barrick Gold (GOLD), Care.com (CRCM), Cars.com (CARS), Carvana (CVNA), Expedia (EXPE), Fitbit (FIT), Fossil (FOSL), Gluu Mobile (GLUU), Marathon (MRO), Papa John's (PZZA), Qualcomm (QCOM), Roku (ROKU), SolarEdge Technologies (SEDG), Square (SQ), TripAdvisor (TRIP), and Wendy's (WEN) will report earnings.

stock market news nov 6

Asia Eyes Trade Headlines; Europe Inches Higher on Economic Data

Stocks in Asia were a mixed bag today, as investors kept an eye on the latest U.S.-China trade headlines. A report out of the South China Morning Post indicated China wants tariffs on $125 million worth of Chinese goods lifted as part of "phase one" for any trade deal. Plus, the People's Bank of China (PBOC) set the midpoint for the yuan at its strongest point since Aug. 8. Against this backdrop, China's Shanghai Composite closed down 0.4%, while Hong Kong's Hang Seng traded marginally higher. Rounding out the region, South Korea's Kospi finished up 0.1%, and Japan's Nikkei ended 0.2% higher, boosted by robot maker Fanuc.

Over in Europe, equity markets are cautiously higher thanks to economic data and corporate reports. The eurozone IHS Markit purchasing managers index rose to 50.6 in October. London's FTSE 100 sits just above breakeven at last check thanks to a profit beat from retailer Marks & Spencer. The French CAC 40 is 0.4% higher after a positive post-earnings reaction from banking name Societe Generale. And lastly, the German DAX sports a 0.2% lead, with earnings from Adidas and BMW in focus.


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