Morning Briefing
Published
S&P 500 futures point to a roughly flat open (SPY +0.2%), with the bond market still doing more to set the tone than yesterday's headline Iran standoff. Treasury yields pushed to fresh multi-year highs into Tuesday's close, and futures are steadying this morning as traders wait for the next move on both the rate and energy fronts.
The Strait of Hormuz standoff has shifted from a pure geopolitical risk to a diesel and refined-products problem for Europe. IEA chief Fatih Birol says the region is heading into a very difficult winter and gets roughly half its diesel from the US, flagging the possibility of further strategic reserve releases. Iran's foreign minister says Tehran shared a seven-point plan with Washington through Qatar and is awaiting an official US response, even as Revolutionary Guard officials escalate their rhetoric toward Trump. Separately, Putin envoy Dmitriev held talks with US Treasury and Energy officials in Washington on the Ukraine war. In China, the PBOC cut its one-year loan prime rate by 25 basis points to 1.5% and expanded relending facilities for technology and agriculture, an easing tilt that contrasts with the tightening bias priced into US and European rates.
In premarket sectors, Technology is the firmest of the main groups, led by chip equipment names, while Energy and Consumer Staples lag. Factor moves are narrow and mixed. Fair Isaac continues to slide sharply after Tuesday's steep drop, and the Global X Cloud Computing ETF is among the weaker thematic movers.
Company News
- CarMax reports fiscal Q2 EPS of $1.16, well above the $0.72 expected, on revenue of $7.88 billion versus $7.05 billion expected, and plans to resume a modest pace of share buybacks next quarter.
- Summit Therapeutics receives a $2.0 billion strategic equity investment from AstraZeneca, which will convert into common stock at $18.36 a share, alongside a new clinical collaboration on sonesitatug vedotin and ivonescimab.
- Novo Nordisk says a real-world study found its 2 mg semaglutide dose associated with a 6% lower risk of serious cardiovascular events than tirzepatide in type 2 diabetes patients.
- Westlake will close its Cologne, Germany PVC plant in the first quarter of 2027, cutting about 120 jobs and taking roughly $205 million in charges, and expects sequentially weaker third-quarter results.
- JPMorgan cuts PepsiCo to neutral with a $138 price target, while Deutsche Bank raises Netflix to Buy but trims its target to $95.
- Volkswagen is expected to disclose a hit from the UK motor finance compensation scheme, according to Sky.
Overseas Data
China's PBOC lowered its one-year loan prime rate to 1.5% and boosted relending support for technology and small businesses. Japan's leading index for July slipped to 117.7 from 117.9, while the coincident index held at 120.6.
Spain's September CPI rose to 4.9% year-on-year, above the 4.6% expected and up from 4.3%, with core inflation accelerating to 3.1%. Italy's producer prices jumped 13.5% year-on-year in August, up from 9.3%, and Switzerland's KOF leading indicator beat expectations at 109.1 versus 106.0 forecast.