Here are five things you must know for Tuesday, June 30:
1. -- Stock Futures Slip as Powell Warns of Uncertainty
Stock futures slipped Tuesday on the final trading day of the second quarter as Federal Reserve Chairman Jerome Powell warned that a rebound in the U.S. economy could stall if the spread of the coronavirus isn't contained.
Contracts linked to the Dow Jones Industrial Average fell 62 points, futures for the S&P 500 declined 4 points and Nasdaq futures fell 7 points. Stocks posted solid gains Monday, with the S&P 500 rising 1.47% after a better-than-expected housing report offset news that coronavirus cases surpassed 10 million people globally.
”We have entered an important new phase and have done so sooner than expected,” Powell said in prepared remarks ahead of testimony Tuesday before the House Financial Services Committee. “While this bounceback in economic activity is welcome, it also presents new challenges - notably, the need to keep the virus in check.”
Powell will be joined Tuesday by U.S. Treasury Secretary Steven Mnuchin.
Lawmakers have have pumped more than $3 trillion into the world's biggest economy, leading to a pick-up in job gains and an increase in consumer spending.
But Powell noted in his remarks that more than 20 million American have lost their jobs since the pandemic took hold in mid-March.
“The path forward for the economy is extraordinarily uncertain and will depend in large part on our success in containing the virus,” he said. “A full recovery is unlikely until people are confident that it is safe to re-engage in a broad range of activities.”
2. -- Jerome Powell and FedEx Lead Tuesday's Calendar
Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin will appear before the House Financial Services Committee at 12:30 p.m. ET.
The economic calendar for Tuesday also includes consumer confidence for June at 10 a.m. ET.
3. -- Uber Makes $2.6 Billion Offer for Postmates
The New York Times, citing three people familiar with the matter, said the talks between the companies were continuing but cautioned any potential deal could fall apart. The Wall Street Journal said an agreement could be announced next week if not sooner.
An acquisition of Postmates could boost Uber’s food-delivery arm, Uber Eats, which has seen demand soar as restaurants have been closed during the coronavirus pandemic.
User's bid for Grubhub GRUB was topped earlier this month by Just Eat Takeaway.com, which agreed to buy Grubhub for more than $7 billion.
4. -- Royal Dutch Shell to Write Down Up to $22 Billion
Royal Dutch Shell (RDS.A) - Get Report will write down the value of its assets by between $15 billion and $22 billion as weaker demand during the coronavirus pandemic has led to a slump in energy prices.
Shell said the largest writedowns would come from its gas business, where it could take charges of up to $9 billion.
Shell said Tuesday it expects fuel sales to fall 40% in the second quarter to 4 million barrels per day as demand has been sharply curtailed by travel restrictions imposed during the pandemic.
5. -- Micron Earnings Lifted by Cloud Demand
Micron Technology (MU) - Get Report, the maker of memory chips, was rising 5.81% to $52 in premarket trading Tuesday after its fiscal third-quarter earnings and sales exceeded estimates and the company said fourth-quarter profit should top analysts' forecasts.
Major orders from cloud giants and a more favorable memory pricing environment helped Micron top Wall Street forecasts.
For the quarter ended May 28, Micron reported adjusted earnings of 82 cents a share as revenue climbed 14% to $5.44 billion.
Analysts has been expecting adjusted profit of 75 cents a share on revenue of $5.27 billion.
"We are ramping the industry's most advanced DRAM technology into production and have delivered more than 75% of our NAND volume as high-value solutions, supported by record [solid-state-drive] revenue in the quarter," CEO and President Sanjay Mehrotra said in a statement.
For the fourth quarter, Micron expects adjusted earnings of 95 cents to $1.15 a share. Revenue should come in at $5.75 billion to $6.25 billion.