Dow Futures Shed 300 Points After Red-Hot CPI Reading

Delta Air Lines reported earnings today

Deputy Editor
Jul 13, 2022 at 9:11 AM
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Futures on the Dow Jones Industrial Average (DJIA) are eyeing a more than 300-point drop ahead of the open, as Wall Street digests key inflation data. Specifically, the consumer price index (CPI) showed a year-over-year bounce of 9.1% in June, much higher than economists' expectations for an 8.8% rise, and more than May's 8.6% increase. The reading also marks the index's biggest such jump since 1981. Meanwhile, Nasdaq-100 Index (NDX) and S&P 500 Index (SPX) futures are also trading well below fair value, and earnings season is firmly underway as Delta Air Lines (DAL) headed into the confessional with a mixed report this morning. 

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

  • Schaeffer's Senior Quantitative Analyst Rocky White breaks down what happens after a yield curve inversion.
  • What investors can expect following today's CPI reading.
  • Plus, a closer look at Delta Air Lines' report; Twitter's lawsuit buzz; and Snap's new NFT venture.

Futures Chart July 13

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw 866,662 million call contracts and 589,893 put contracts traded on Tuesday. The single-session equity put/call ratio rose to 0.68, and the 21-day moving average stayed at 0.65.
  2. Delta Air Lines, Inc. (NYSE:DAL) was last seen 6.1% lower ahead of the open, after the company reported earnings of $1.44 per share for its second quarter, which fell well short of analysts' $1.73 estimate. And though revenue topped forecasts, margins were dented by higher fuel and operational costs. Coming into today, DAL was already saddled with a 20.4% year-to-date deficit.
  3. Twitter Inc (NYSE:TWTR) is suing to force Tesla (TSLA) CEO Elon Musk to adhere to the terms of his $44 billion takeover of the social media company. Musk reported earlier this week that he was pulling his bid from the table, claiming Twitter had violated terms of the agreement. In response, TWTR was last seen up 1.8% in electronic trading, chipping away at its 21.2% year-to-date losses.
  4. Social media concern Snap Inc (NYSE:SNAP) is off 2.4% in electronic trading, after the Financial Times reported that the company is introducing a feature that would allow NFT artists to exhibit their work on Snapchat. Year-over-year, Snap stock sits 78.3% lower.
  5. The schedule is packed today, with the latest Beige Book and a federal budget update on tap.

OV Buzz Chart July 13

Chinese Exports Jump Nearly 18% in June

Asian markets are mostly higher today, with the exception of the Hong Kong Hang Seng, which posted a 0.2% loss. Chinese trade data indicated a 17.9% rise in June exports – much higher than the 12% estimates -- while imports rose 1%, less than the expected 3.9%. China’s Shanghai Composite finished slightly higher with a 0.09% gain. Elsewhere, Japan’s Nikkei and the South Korean Kospi both tacked on 0.5%, the latter rising after the Bank of Korea raised interest rates by 50 basis points, the largest hike since the current adopted system in 1999.

European markets, on the other hand, seem to be continuing their recent slump, as investors awaited inflation data out of the U.S. Both London’s FTSE 100 and the French CAC 40 are down 0.8% midday, while the German DAX is down 1%.

 

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