Here are five things you must know for Tuesday, November 23:
1. -- Stock Futures Mixed As Rate Hike Bets Accelerate
U.S. equity futures traded mixed Tuesday, although volumes are beginning to thin ahead of the Thanksgiving holiday break, as investors re-set interest rate expectations following President Joe Biden's decision to name Jerome Powell to a second term as Federal Reserve Chairman.
Powell's nomination, alongside prospective Vice Chair Lael Brainard, has boosted bets on both a near-term acceleration of the Fed's tapering strategy, as well as those linked to a 2022 rate hike, in the face of the fastest pace of domestic inflation in more than three decades.
That's lifted the dollar index, which tracks the greenback against a basket of six global currencies, to its highest levels in 16 months, while bumping benchmark 2-year note yields to a March 2020 high of 0.634% in overnight trading.
On Wall Street, futures contracts tied to the Dow Jones Industrial Average are indicating a 25 point opening bell gain while those linked to the S&P 500 are priced for a 2.5 point move to the downside.
Futures tied to the tech-focused Nasdaq Composite, which tumbled 1.26% from its all time high last night, are indicating a 45 point dip as benchmark 10-year Treasury note yields climbed to 1.637% in overnight trading.
2. -- Oil Slides As U.S. Moves to Lead Global Crude Release
Global oil prices slid to a near two-month low Tuesday amid multiple reports that the U.S. will lead a coordinated effort to release crude from its strategic petroleum reserve in an effort to tame surging energy costs.
The so-called swap, which will see oil companies taking as much as 35 million to 45 million barrels from the U.S. SPR, before returning it several weeks later, will be made in conjunction with releases from Japan, South Korea, India and China, the reports have indicated. Collectively, the release could bring 100 million barrels to the market.
Oil prices have rallied more than 50% this year, to the highest levels since 2014, as both the China and European energy crunch triggers fresh crude buying - a dynamic OPEC leaders have largely dismissed as the hold to previous plans that only include modest changes to the cartel's daily production targets.
WTI futures for January delivery were marked 98 cents lower on the session at $75.77 each while Brent crude contracts for January, the global benchmark, fell 68 cents to $79.02 per barrel.
3. -- Xpeng Shares Jump After Q3 Revenue Surge
Xpeng (XPEV) - Get Xpeng Inc Report shares jumped higher in pre-market trading after the China-based electric carmaker, and upstart Tesla TSLA rival, posted stronger-than-expected third quarter earnings.
Xpeng delivered 25,666 cars over the three months ending in October, the group said, helping a 187.4% surge in overall revenues to 5.72 billion Chinse yuan. Deliveries over the fourth quarter were forecast between 34,500 and 36,500, Xpeng said.
“In the third quarter, we continued record-setting growth with the highest vehicle deliveries among China’s startup new energy vehicle automakers," said CEO He Xiaopeng. "This outperformance testifies to the market’s recognition of the differentiated value our vertically integrated in-house developed software and hardware bring to our vehicles.”
Xpeng's U.S.-listed shares were marked 4.1% higher in pre-market trading to indicate an opening bell price of $49.35 each.
4. -- Zoom Shares Tumble Despite Solid Q3 Earnings
Zoom Video Communications (ZM) - Get Zoom Video Communications, Inc. Class A Report shares tumbled in pre-market trading even as the video conferencing group posted stronger-than-expected third quarter earnings and issued a robust full-year outlook.
Zoom, which won hundreds of thousands of new customers during the peak of last year's pandemic, beat the Street by 2 cents with an adjusted profit of $1.11 per share on revenues of $1.05 billion.
The growth revenue rate, however, slowed notably from the previous quarter (35% v 54%) and plunged from last year's 360% pandemic-era surge, suggesting Zoom will struggle to hold customers, and boost sales, as more people return to full-time office work and students conduct in-person lessons.
Zoom shares were marked 8% lower in pre-market trading to indicate an opening bell price of $223.00 each.
5. -- Comcast May Pull Content From Hulu
Comcast (CMCSA) - Get Comcast Corporation Class A Report shares edged higher in pre-market trading following a report from the Wall Street Journal that suggested the media group will remove most of its NBCUniversal content from Disney's (DIS) - Get Walt Disney Company Report Hulu streaming service.
The Journal said Comcast is looking to beef-up its Peakcock subscription service with the move, which would include popular shows such as Saturday Night Live, and likely begin in the fall of next year.
Peacock generated $230 million in revenues over Comcast's third quarter, but registered an adjusted loss of $520 million as content acquisition costs ate into the group's bottom line.
Comcast shares were marked 0.55% higher in pre-market trading to indicate an opening bell price of $51.80 each. Disney shares fell 0.6% to $153.25 each.