SpaceX, Costco, Okta, Bond Volatility, Jerome Powell - 5 Things You Must Know Thursday

Stock futures fall though Treasury yields stabilize following a session of bond volatility that sent tech stocks sharply lower; Costco and Slack report earnings; SpaceX's biggest rocket lands successfully but then explodes; Okta to buy identity software rival Auth0.
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Here are five things you must know for Thursday, March 4:

1. -- Stock Futures Fall and Bond Yields Steady

Stock futures fell Thursday though Treasury yields stabilized following a session of bond volatility that rattled investors.

Contracts linked to the Dow Jones Industrial Average declined 28 points, S&P 500 futures fell 7 points and Nasdaq futures were down 39 points.

The yield on the benchmark 10-year Treasury traded at 1.46% early Thursday.

An anticipated increase in inflation and expectations of higher borrowing costs have investors questioning the valuations of high-flying tech giants such as Apple  (AAPL) - Get Report, Microsoft  (MSFT) - Get Report and Amazon.com  (AMZN) - Get Report.

Those concerns sent stocks lower on Wednesday with the tech-heavy Nasdaq slumping 2.7%. The Nasdaq recorded its worst two-day decline since September as benchmark Treasury yields rose to near 1.5%.

“The dial ticks back to rising bond yield concerns, between that and the broad risk-on mood derived from the global economic recovery,” said Jingyi Pan, a senior market strategist with IG.

Wall Street will be closely monitoring comments Thursday from Federal Reserve Chairman Jerome Powell, who is expected to say at a webinar that rising yields were signs of the market's confidence in the outlook for the economy and not a detriment to a recovery.

2. -- Thursday's Calendar: Costco and Kroger Earnings, Jerome Powell Webinar

Earnings reports are expected Thursday from Costco  (COST) - Get Report, Gap  (GPS) - Get Report, Kroger  (KR) - Get Report, Broadcom  (AVGO) - Get Report, Ciena  (CIEN) - Get Report and Slack Technologies  (WORK) - Get Report.

Costco and Broadcom are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells the stocks? Learn more now.

The U.S. economic calendar for Thursday includes weekly Jobless Claims at 8:30 a.m. ET, Productivity and Costs for the fourth quarter at 8:30 a.m. and Factory Orders for January at 10 a.m.

Federal Reserve Chairman Jerome Powell will be holding a discussion - "Conversation on the U.S. Economy" - at The Wall Street Journal Jobs Summit beginning at 12:05 p.m.

3. -- SpaceX's Biggest Rocket Lands Successfully, Then Explodes

SpaceX's biggest rocket, the Starship SN-10 prototype, managed to take off and land at a test facility in Texas on Wednesday but blew up minutes after touching down.

The starship, developed by Tesla  (TSLA) - Get Report CEO Elon Musk’s privately held SpaceX, flew to a height of about 10 kilometers before shutting off all engines and dropping back toward earth. A dramatic re-ignition of the engines about a mile above the ground then turned the craft into its vertical orientation and slowed its descent, allowing it to land upright amid huge plumes of dust.

After the landing, a fire was visible at the base of the vehicle, possibly after a fire ignited fuel.

Two previous test rockets - one in December and another in January - managed to take off but exploded before they could complete their landings.

Musk has touted the Starship as a means of traveling to Mars.

Even after the explosion, Musk issued a celebratory tweet saying “Starship SN10 landed in one piece!”

4. -- Okta to Buy Identity Software Rival Auth0 for $6.5 Billion

Okta  (OKTA) - Get Report fell more than 10% in premarket trading Thursday after the identity-verification specialist said it was acquiring Auth0, a rival in the industry, for $6.5 billion of stock.

The announced acquisition, along with a weaker-than-expected outlook for the fiscal first quarter and fiscal 2022, sent shares down 10.21% to $216.58.

"Organizations everywhere are rapidly leveraging identity to streamline processes, reduce costs, maintain the highest levels of security, and improve customer experiences," Okta said in a statement.

"Okta and Auth0’s comprehensive, complementary identity platforms are robust enough to serve the world’s largest organizations and flexible enough to address every identity use case," the company added.

The deal is expected to close in Okta’s fiscal second quarter ending July 31.

5. -- Disney Plans to Close 60 Stores

Walt Disney  (DIS) - Get Report plans to close at least 60 of its Disney stores in North America this year as the entertainment giant focuses more on its e-commerce business.

The company operates about 300 Disney Stores worldwide.

“While consumer behavior has shifted toward online shopping, the global pandemic has changed what consumers expect from a retailer,” said Stephanie Young, Disney's president of consumer products, games and publishing.

Disney also is evaluating the shutdown of European stores as it rethinks its retail strategy, according to Bloomberg.

Disney is one of the world’s largest licensing companies. But sales at its merchandise licensing and retail business fell 7% last year to $4.18 billion, largely related to stores being closed during the pandemic, Bloomberg noted.

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