Here are five things you must know for Friday, October 22:
1. -- Stocks Futures Mixed As Tech Slides, Treasury Yields Jump
U.S. equity futures traded mixed Friday, with tech stocks hit by a warning on ad spending from social media group Snap, as well as another move higher in Treasury bond yields.
Global stocks are on pace for their third weekly advance, however, following last night's record high close for the S&P 500 -- 33 days after its last peak in early September -- a series of stronger-than-expected third quarter earnings reports and the lowest level of weekly jobless claims in nineteen months.
Reports of a a surprise $83.5 million coupon payment by indebted property group China Evergrande, just days ahead of a possible default, added to the session's positive tone.
Snap's (SNAP) - Get Snap, Inc. Class A Report warning on the advertising market, linked to supply chain bottlenecks and shortages of goods that would clip marketing budgets, hit the tech sector hard, with big names such as Facebook (FB) - Get Meta Platforms Inc. Class A Report, Twitter (TWTR) - Get Twitter, Inc. Report and Alphabet (GOOGL) - Get Alphabet Inc. Class A Report,, falling hard in pre-market trading.
On Wall Street, futures contracts tied to the Dow Jones Industrial Average are indicating a 20 point opening bell gain, while those linked to the S&P 500 are priced for 3 point pullback ahead of earnings from Honeywell (HON) - Get Honeywell International Inc. Report and American Express (AXP) - Get American Express Company Report as well as a panel appearance from Federal Reserve Chairman Jerome Powell at 11:00 am Eastern time.
Futures tied to the tech-focused Nasdaq Composite are indicating a 50 point move to the downside at the start of trading, thanks in part to the Snap warning and another leg higher in benchmark 10-year Treasury note yields, which traded at 1.705% in overseas markets.
2. -- Snap Shares Tumble on Ad Sales Warning
Snap (SNAP) - Get Snap, Inc. Class A Report shares plunged lower Friday after the social media group forecast weaker-than-expected holiday sales and cautioned that supply chain disruptions would hit advertising spending in the months ahead.
Snap, which makes the Snapchat messaging app, said that "advertising partners across a wide variety of industries and geographies that they are facing headwinds in their business related to disruptions in global supply chains as well as labor shortages and increasing costs', and were reducing marketing spend as a result.
Snap said it sees holiday quarter sales growing between 28% and 32% -- well below the consensus forecast of 48% -- after posting softer-than-expected sales of $1.07 billion for the three months ending in September.
Snap shares were marked 20.12% lower in pre-market trading Friday to indicate an opening bell price of $60 each.
Facebook tumbled in sympathy, falling 3.8% to $328.90 each while Twitter shares were marked 3.82% lower at $62.90 each. Google parent alphabet fell 1.9%.
3. -- Intel Says Chip Launches Will Clip Profit Margins
Intel Corp. (INTC) - Get Intel Corporation Report shares slumped lower in pre-market trading after the group reported weaker-than-expected third quarter sales and said profit margins would narrow as it ramps-up new technology chipmaking.
Intel's adjusted bottom line for the September quarter, at $1.71 per share, topped Street forecasts thanks in part to an extended boom in PC demand. Sales, however, fell modestly shy of the consensus at $18.1 billion.
Looking into the near term, however, Intel said its newer, faster chips would be less profitable in the early phase of their release, adding that profit margins would fall to between 51% and 53% over the next three years. That's around 3 to 5 percentage points lower than the 2022 forecast of 56.2%.
"We have a couple of years to work through, but this is going to be a great outcome," CEO Pat Gelsinger told investors on a conference call late Thursday. "We think all of our aggressive lean-ins right now are going to be handsomely rewarded in the marketplace."
Intel shares were marked 10% lower in pre-market trading Friday to indicate an opening bell price of $50.40 each.
4. -- Mattel Defies Supply Chain Snags With Solid Holiday Outlook
Mattel, the maker of Barbie and Hot Wheels, topped Street forecasts with a third quarter bottom line of $84 cents a share on revenues of $1.76 billion. Looking into the final months of the year, the toymaker said its sees 2021 sales growing by 15%, beating its prior forecast of between 12$ and 14%, with earnings in the range of $900 million to $925 million.
Mattel was "very successful in working through global supply chain disruptions," CEO Ynon Kreiz told investors on a conference call late Thursday. "And it's not that we were not impacted, but we did anticipate short supply and longer lead times, and factor that into our planning and took very specific mitigating actions."
Mattel shares were marked 6.25% higher in pre-market trading Friday to indicate an opening bell price of $21.60 each.
5. -- President Biden Cautions on U.S. Gas Prices
President Joe Biden warned Americans that gas prices would likely remain elevated well into next year, blaming OPEC's ongoing production cuts and a "a foreign policy initiative'.
Speaking during a a CNN town hall in Baltimore, Maryland, Biden said gas prices will "start to come down into next year, in 2022" but cautioned that he didn't see anything that’s going to happen in the meantime that’s going to significantly reduce gas prices.”
A surge in global energy prices, triggered in part by natural gas supply shortages, record-high coal prices in China and tougher emissions standards, have lifted oil prices more than 60% so far this year, taking WTI crude to its highest levels in nearly seven years. OPEC' production cuts, which are taking more than 1.2 million barrels from the market each day, have added to the upward price pressures.
U.S. gasoline prices, meanwhile, have risen 52% so far this year to a 2014 high of $3.36 per gallon, according to Gasbuddy.com