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AMC, Tesla, Exxon and Lululemon - 5 Things You Must Know Thursday

Stock futures fall as investors eye employment data and the Fed's next policy moves; AMC turns lower; activist likely wins third seat on Exxon's board.

Here are five things you must know for Thursday, June 3:

1. -- Stock Futures Fall as Investors Eye Jobs Data and the Fed

Stock futures declined with investors eyeing employment data both Thursday and Friday for clues on the Federal Reserve's next policy moves.

Contracts linked to the Dow Jones Industrial Average fell 175 points, S&P 500 futures were down 25 points and Nasdaq futures declined 106 points.

The ADP National Employment report and weekly jobless claims, to be released Thursday, and Friday's issuance of the U.S. nonfarm payrolls report for May will offer investors further gauges on the employment picture and could offer hints on how the central bank may act when it meets next month.

Investors have been closely watching for signs of inflation and indications on whether the Fed could put the brakes on the rebounding U.S. economy sooner than anticipated.

Fed officials repeatedly have said it's too early to withdraw support for an economy just beginning to rebound from the coronavirus pandemic.

But Philadelphia Fed President Patrick Harker said Wednesday the central bank should soon begin discussing the time frame for paring back on its bond-buying program of $120 billion a month.

“I think it is appropriate for us to slowly, carefully move back on our purchases at the appropriate time,” Harker said during a virtual Women in Housing and Finance event. “When that is, that is something we need to start discussing.”

Stocks finished modestly higher Wednesday as investors looked ahead to the U.S. jobs data.

2. -- AMC Shares Turn Lower

AMC Entertainment  (AMC)  turned lower, down more than 8%, after announcing it filed to sell up to 11.55 million shares.

The stock was powering higher in premarket trading before the announcement, a day after the movie-theater chain and meme-stock favorite soared to an all-time high.

The stock closed Wednesday's session up 95.22% to $62.55. At one point on Wednesday, the stock soared as much as 127%, pushing its total gains for the year to 3,000% and its market value briefly past $33 billion, according to Bloomberg.

Jim Cramer, TheStreet's founder, said he thinks AMC is now well into "overvalued" territory, with the stock's incredible gains coming amid intensifying competition in the home streaming market and the impact of COVID-triggered restrictions on public gatherings around the world. 

AMC was on the brink of bankruptcy earlier this year but was saved after it raised about $1 billion in funding.

"AMC is fascinating, but now, at $22 billion, with 300 million shares traded out of a float of 500 million, it's obvious that this is a stock where the sellers have just had to go away," Cramer told CNBC's Tech Check program. "The meme people have two stocks, they have GameStop  (GME)  and they have AMC, and they have nothing else frankly."

AMC shares received a boost Wednesday from the launch of an initiative called "AMC Investor Connect," a portal that will allow the company's 3.2 million retail investors to "self-identify" as stockholders and receive special offers and updates.

David Trainer, CEO of investment research firm New Constructs, said there was "no fundamental reason" to be buying shares of AMC.

"The stock is up well over 2,000% so far this year and is trading at levels that are entirely disconnected from fundamentals," Trainer said, adding he thinks the stock is worth "$0 per share, given its weak earnings, dilution from recent stock offerings and mountain of debt."

3. -- Thursday's Calendar: ADP Jobs Report, Jobless Claims and Lululemon Earnings

The U.S. economic calendar Thursday includes the ADP National Employment Report for May at 8:15 a.m. ET, weekly Jobless Claims at 8:30 a.m., Productivity and Costs for the first quarter at 8:30 a.m., the ISM Services Index for May at 10 a.m. and Oil Inventories for the week ended May 28 at 11 a.m.

Earnings reports are expected Thursday from Lululemon Athletica  (LULU) , Five Below  (FIVE) , Broadcom  (AVGO) , Crowdstrike  (CRWD) , Ciena  (CIEN) , Express  (EXPR) , Slack Technologies  (WORK)  and PagerDuty  (PD) .

Broadcom is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells AVGO? Learn more now.

4. -- Activist Seen Gaining Third Seat on Exxon Board

Activist investor Engine No. 1 likely will gain a third seat on the board of Exxon Mobil  (XOM) , according to updated vote tallies.

The initial counts showed the newest nominee from Engine No.
1’s slate elected to Exxon’s board was Alexander Karsner, a strategist at Google parent Alphabet  (GOOGL) .

The results, which still need to be certified, confirmed an
earlier report by Bloomberg. The final vote count could take days or weeks to be finalized. 

The outcome is a win for Engine No. 1, an upstart hedge fund that has been pushing Exxon to be more active in combating climate change. The fund won two seats on Exxon's board at the company's annual shareholder meeting last week.

5. -- Tesla Recalling Model 3 Cars Shipped to China

Tesla  (TSLA)  has recalled more than 700 units of its Model 3 electric car that were imported into China, CNBC reported, citing the central government’s market regulator.

The recall affects a total of 734 vehicles produced in 2019, the State Administration for Market Regulation said on its website, citing a recall plan that Tesla filed. 

The vehicles are being recalled because of seat belt or tire-related safety issues.

The news from China follows a recall of nearly 6,000 U.S. vehicles because brake caliper bolts could be loose, potentially causing a loss of tire pressure.

According to a filing with the National Highway Traffic Safety Administration made public on Wednesday, Tesla is recalling certain 2019-2021 Model 3 vehicles and 2020-2021 Model Y vehicles.