Tesla, Dow Futures, Jerome Powell, GameStop: 5 Things You Must Know - TheStreet

Tesla, Dow Futures, Jerome Powell, GameStop: 5 Things You Must Know Tuesday

Stock futures turn higher following the S&P 500's fourth straight losing session; Federal Reserve Chairman Jerome Powell says the economy needs more help from Congress to prevent long-term damage; Tesla's 'Battery Day' takes places Tuesday.

Here are five things you must know for Tuesday, Sept. 22:

1. -- Stock Futures Turn Higher

Stock futures were rising Tuesday following the S&P 500's fourth consecutive losing session as investors contend with an increase in coronavirus cases worldwide, dimming prospects for more fiscal stimulus from Congress and volatility as the U.S. presidential election approaches.

Federal Reserve Chairman Jerome Powell and U.S. Treasury Secretary Steven Mnuchin will speak later Tuesday before a congressional panel.

Contracts linked to the Dow Jones Industrial Average rose 21 points, S&P 500 futures were up 9 points and Nasdaq futures rose 72 points.

U.S. stocks fell Monday, extending the market's September selloff, but pared losses with a late-session recovery.

The Dow finished down 509 points, or 1.84%, to 27,147, the S&P 500 dropped 1.16% and the Nasdaq eased 0.13%.

Stocks have fallen the first three weeks of September. The S&P 500 has declined 8.4% since hitting a record high on Sept. 2.

2. -- Fed's Powell: More Stimulus Needed to Prevent Long-Term Economic Damage

Federal Reserve Chairman Jerome Powell, in prepared remarks that he will deliver Tuesday before the House Financial Services Committee, said the U.S. economy "will recover fully from this difficult period" but more fiscal stimulus will be needed to prevent long-term damage from the coronavirus pandemic.

"Economic activity has picked up from its depressed second-quarter level, when much of the economy was shut down to stem the spread of the virus. Many economic indicators show marked improvement," Powell said. 

"Both employment and overall economic activity, however, remain well below their pre-pandemic levels, and the path ahead continues to be highly uncertain," he added.

“The path forward will depend on keeping the virus under control, and on policy actions taken at all levels of government,” the Fed chairman said.

Powell and Treasury Secretary Steven Mnuchin are scheduled to testify at 10:30 a.m. ET Tuesday. They also will appear Thursday before the Senate Banking Committee. Powell will testify Wednesday before a separate House panel overseeing the response to the pandemic.

Powell's appearance headlines Tuesday's economic calendar that also includes Existing Home Sales for August at 10 a.m.

The earnings calendar Tuesday includes reports from Nike  (NKE) - Get Report, Aurora Cannabis  (ACB) - Get Report, Stitch Fix  (SFIX) - Get Report and AutoZone  (AZO) - Get Report.

3. -- Tesla Falls Ahead of 'Battery Day'

Tesla was falling 3.65% in premarket trading Tuesday to $432.97 after CEO Elon Musk tweeted the electric vehicle maker plans to boost battery cell purchases from suppliers and foresees “significant shortages in 2022 & beyond unless we also take action ourselves.”

The tweets came a day before Tesla’s widely anticipated “Battery Day” event Tuesday at which the company is expected to reveal new battery cell technology that significantly boost boost battery life.

In his tweets, Musk said that notwithstanding the announcement, Tesla intends to increase purchases of battery cells from third-party suppliers. The announcement pertains more to long-term production, particularly for semi, cybertruck and roadster vehicles and won’t reach high-volume production until 2022, Musk tweeted.

The Street’s Jim Cramer said investors have been expecting big things from the “Battery Day” announcements.

“The bar’s gotten very high,” Cramer said in an interview on StreetLightning. “If he does not show something that indicates he’s got a battery that is game-changing, then we’re going to suffer from the same overhang that we had when Tesla was supposed to be added to the S&P 500.”

Tesla's annual shareholder meeting and Battery Day are scheduled to be webcast beginning at 4:30 p.m. ET.

4. -- Activist Trian Takes Stake in Comcast

Comcast  (CMCSA) - Get Report was rising slightly in premarket trading following a report that said hedge fund Trian Fund Management launched an activist campaign against the cable-TV and entertainment giant, believing the stock is undervalued.

Trian has accumulated about 20 million shares in Comcast, for a roughly $900 million stake or about 0.4% of the company, a person familiar with the matter told The Wall Street Journal.

Comcast's market value is about $200 billion.

Executives at Trian, which is led by activist investor Nelson Peltz, recently began conversations with Comcast management, the hedge fund said in a statement. It wasn't clear what exactly Trian is focused on beyond a belief that Comcast shares are undervalued, the Journal noted.

"We have recently begun what we believe are constructive discussions with Comcast's management team and look forward to continuing those discussions," Trian said.

Comcast shares hit an all-time high before the onset of the coronavirus pandemic in March. For the year to date, the shares have declined less than 1%.

5. -- Investor Cohen Envisions GameStop as Amazon Rival

Ryan Cohen, who recently acquired a 10% stake in GameStop  (GME) - Get Report, believes the video-game retailer could become a true competitor to Amazon.com  (AMZN) - Get Report.

Cohen, GameStop's biggest individual investor, disclosed he is holding talks with management and several board members. Cohen’s firm, RC Ventures, has expressed willingness to get more involved with GameStop in order “to produce the best results for all shareholders,” according to a filing, Bloomberg reported.

Cohen’s vision is to broaden GameStop’s online selection and compete head-to-head with some of the biggest e-commerce companies, according to person familiar with the matter.

GameStop’s website could sell a wide range of merchandise - not just video games and accessories - and ship it to customers more quickly, a la Amazon, Bloomberg reported.

Cohen co-founded Chewy and served as its CEO, and then sold it in 2017 to PetSmart.

GameStop rose 25.14% in premarket trading to $10.95.