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Robinhood, Moderna, Etsy and Uber - 5 Things You Must Know Thursday

Stock futures point modestly higher; Moderna reports earnings; Robinhood drops after a two-day rally of 125%; Esty sinks on weak guidance.

Here are five things you must know for Thursday, Aug. 5:

1. -- Stock Futures Rise Modestly as Wall Street Weighs Earnings and the Delta Variant Spread

Stock futures pointed to a modestly higher start for Wall Street on Thursday as investors weighed strong corporate earnings against concerns the rapidly spreading delta variant of COVID-19 could interrupt the economic recovery.

Contracts linked to the Dow Jones Industrial Average gained 44 points, S&P 500 futures were up 7 points and Nasdaq futures rose 30 points.

The yield on the benchmark 10-year Treasury edged lower Thursday to 1.182%.

Stocks finished mostly lower Wednesday after private employers in the U.S. added fewer-than-expected jobs in July, suggesting an uneven recovery as pandemic concerns and supply-chain disruptions hold back employment gains.

The Labor Department will release the official U.S. jobs report on Friday. Economists surveyed by FactSet expect the U.S. to have added 862,500 jobs in July, higher than June's 850,000. The unemployment rate is forecast to fall to 5.7% from 5.9%.

"We think the labor market will continue to improve through the fall season, but gains are likely to be uneven, with the delta variant likely to disrupt service-based and leisure industries," said Angelo Kourkafas, investment strategist at Edward Jones. "The labor market is a key pillar to economic growth, and the Federal Reserve is watching employment gains closely as part of its monetary policy framework.”

Investors also were assessing comments from Fed Vice Chairman Richard Clarida, who said the central bank could begin boosting interest rates early in 2023 as long as the economy continues to expand.

On the virus front, China, hard-hit by a delta-driven outbreak, imposed new restrictions on travel and movement. New COVID cases in the U.S. hit a six-month high with more than 100,000 infections reported on Wednesday, according to Reuters. About two-thirds of Australia’s population was in lockdown.

2. -- Thursday's Calendar: Moderna Earnings, Weekly Jobless Claims

Moderna  (MRNA) - Get Moderna, Inc. Report reported second-quarter earnings of $6.46 a share, higher than analysts' estimates of $5.96.

Earnings reports are expected Thursday from Zoetis  (ZTS) - Get Zoetis, Inc. (ZTS) Report, Regeneron Pharmaceuticals  (REGN) - Get Regeneron Pharmaceuticals, Inc. Report, Monster Beverage  (MNST) - Get Monster Beverage Corporation (MNST) Report, Cloudflare  (NET) - Get Cloudflare Inc Class A Report, Datadog  (DDOG) - Get Datadog Inc Class A Report, ViacomCBS  (VIACA) - Get ViacomCBS Inc. Class A Report, Wayfair  (W) - Get Wayfair, Inc. Class A Report, Virgin Galactic  (SPCE) - Get Virgin Galactic Report and Zillow  (ZG) - Get Zillow Group, Inc. Class A Report.

The economic calendar in the U.S. Thursday includes weekly Jobless Claims at 8:30 a.m. ET and International Trade in Goods and Services for June at 8:30 a.m.

3. -- Robinhood Drops After Wednesday's Scorching Rally

Robinhood Markets  (HOOD) - Get Robinhood Report dropped sharply Thursday after shareholders filed to sell nearly 100 million shares less than a week after the stock made its Nasdaq trading debut. 

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Enthusiasm for the stock, driven largely by the retail trading crowd, propelled shares of the online trading platform more than 125% higher over the last two days.

The stock declined 10.23% early Thursday to $63.19. It closed with a gain of more than 50% on Wednesday, rebounding from its disappointing debut last week.

TheStreet's founder, Jim Cramer, said the rally in Robinhood on Wednesday was driven by commentary on social media outlet Reddit. The frenzy in Robinhood was similar to gains seen earlier this year in shares of GameStop  (GME) - Get GameStop Corp. Class A Report and AMC Entertainment  (AMC) - Get AMC Entertainment Holdings, Inc. Class A Report that were driven by the retail-trading crowd.

“My feeling is that this move is not as sophisticated, it’s
more of a herd mentality move like AMC or GameStop,” Chris
Grisanti, chief equity strategist at MAI Capital Management, told Bloomberg.
“Looking at the chart and scratching our heads and saying I
don’t know is the same feeling we had with GameStop and AMC.”

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4. -- Etsy Sinks After Issuing Weak Guidance

Etsy  (ETSY) - Get Etsy, Inc. Report fell sharply in premarket trading Thursday after the online marketplace reported slower revenue growth in the second quarter and issued weaker-than-expected guidance

The stock dropped 13.16% to $175.50 after Etsy said it expects third-quarter revenue of $500 million to $525 million, below analysts' forecasts of $527.5 million.

The company said it anticipates mid-single-digit gross merchandise sales growth for its core Etsy marketplace during the third quarter and mid-teens growth in gross merchandise sales, excluding facemasks.

Etsy's number of active buyers in the second quarter rose 50% to 90.49 million, but below forecasts of 91.05 million.

5. -- Uber Tumbles After Loss Is Wider Than Expected

Uber Technologies  (UBER) - Get Uber Technologies, Inc. Report declined early Thursday after the ride-hailing company reported a wider-than-expected loss in the second quarter.

Uber reported a second-quarter loss before interest, tax and other expenses of $509 million in the period, narrower than the year-earlier loss, but wider than analysts' expectations of $325 million.

“In Q2 we invested in recovery by investing in drivers and we made strong progress, with monthly active drivers and couriers in the U.S. increasing by nearly 420,000 from February to July,” said CEO Dara Khosrowshahi. 

Chief Financial Officer Nelson Chai said in a statement that Uber expects an adjusted Ebitda loss of less than $100 million in the third quarter with gross bookings between $22 and $24 billion.