Here are five things you must know for Tuesday, Feb. 26:
1. -- Stocks Slip as Geopolitical Risks Dent Sentiment
U.S. stock futures traded lower on Tuesday, Feb. 26, and global stocks declined amid a series of geopolitical risks that trimmed risked appetite in the Asia region and could ripple into the Wall Street trading session ahead of Senate testimony from Federal Reserve Chairman Jerome Powell.
Donald Trump was headed to Vietnam for a summit on Wednesday with North Korean leader Kim Jong Un in Hanoi in which the two men will attempt to solidify terms of their 2018 meeting in Singapore aimed at the denuclearization of the Korean Peninsula.
Trump told reporters in Washington Monday before heading to the region, however, that his trade team was "very close" to cutting a deal with China following weeks of negotiations between Washington and Beijing, adding it "could happen fairly soon, or it might not happen at all."
Trump's non-committal stance on trade talk progress, despite his decision to extend a March 1 deadline on tariffs, pulled Asia stocks from their recent five-month highs and push U.S. stock futures lower.
Meanwhile, Pakistan said India launched an airstrike on its territory early Tuesday, following a suicide bomb in the Pulwama District of the disputed region of Kashmir that killed 40 Indian military policemen.
Contracts tied to the Dow Jones Industrial Average fell 88 points, futures for the S&P 500 declined 5.75 points, and Nasdaq futures slumped 22.25 points.
Powell will deliver his semiannual monetary report to Congress before the Senate Committee on Banking, Housing and Urban Affairs at 10 a.m. ET.
It was last month that the central bank paused on raising interest rates further and said it was determined to be "patient" on any future interest-rate increases despite U.S. economic growth the Fed deemed "solid." The Fed raised interest rates four times in 2018.
The economic calendar in the U.S. Tuesday includes Housing Starts for December at 8:30 a.m. , the S&P Corelogic Case-Shiller Home Price Index for December at 9 a.m., the FHFA House Price Index for December at 9 a.m., and Consumer Confidence for February at 10 a.m.
2. -- SEC Asks Judge to Hold Tesla's Musk in Contempt of Court
The Securities and Exchange Commission asked a judge to hold Tesla Inc. (TSLA - Get Report) CEO Elon Musk in contempt of court for violating the terms of his settlement with the agency with a recent tweet.
The SEC said Musk's tweet from earlier February, in which he appeared to reveal material information on Tesla's production schedule, violated an October 2018 settlement that prohibited Musk from sharing company information without vetting from legal counsel. The settlement itself, reached through U.S. District Judge Alison Nathan, was linked to an August 2018 tweet by Musk over plans to take the electric carmaker private that the SEC said was misleading to investors.
"(Musk has) once again published inaccurate and material information about Tesla to his over 24 million Twitter followers, including members of the press, and made this inaccurate information available to anyone with Internet access," the SEC alleged in papers filed to the federal court in Manhattan. "Musk has thus violated the court's final judgment by engaging in the very conduct that the pre-approval provision of the final judgment was designed to prevent."
Musk tweeted and then revised a tweet about Tesla's production projections on Feb. 19.
Meant to say annualized production rate at end of 2019 probably around 500k, ie 10k cars/week. Deliveries for year still estimated to be about 400k.- Elon Musk (@elonmusk) February 20, 2019
Under the terms of the settlement with the SEC last October, Musk was required to step down as chairman of Tesla and to pay a $20 million fine stemming from a "going private" tweet that falsely claimed he had financing to take Tesla private at $420 a share.
The company also was forced to pay a $20 million fine, to appoint additional independent directors and to "put in place additional controls and procedures to oversee Musk's communications," the SEC said at the time.
Tesla shares fell 2.9% to $290.08 in premarket trading on Tuesday.
3. -- Home Depot, Macy's, Palo Alto Networks Report Earnings
Home Depot Inc. (HD - Get Report) posted weaker-than-expected fourth-quarter earnings thanks in part to a $247 million charge linked to Interline brands division while forecasting slower 2019 profit growth.
Home Depot said earnings were $2.09 a share, shy of the Wall Street consensus of $2.16. Revenue was $26.5 billion, up 10.8% but again missing the consensus estimate. Home Depot said it took a 16-cent charge in the quarter linked to its Interline Brands division.
Looking into 2019, Home Depot said it sees comparable-store sales growth of around 5%, following a fourth-quarter rate of around 3.2% and a U.S. pace of 3.7%. It also sees full-year 2019 earnings growing 3.1% to $10.03 per share, well shy of the $10.26 Refinitiv forecast, and overall revenue to grow 3.3%, suggesting a total of $111.77 billion.
Earnings reports are expected also Tuesday from Macy's Inc. (M - Get Report) , Palo Alto Networks Inc. (PANW - Get Report) , Toll Brothers Inc. (TOL - Get Report) , J M Smucker Co. (SJM - Get Report) , Discovery Inc. (DISCA - Get Report) , Papa John's International Inc. (PZZA - Get Report) , Weight Watchers International Inc. (WTW) and Mylan NV (MYL - Get Report) .
4. -- AT&T Could Learn Tuesday Fate of Time Warner Deal - Report
AT&T Inc. (T - Get Report) could learn as soon as Tuesday whether it can finally move forward with its acquisition of Time Warner and put behind it the legal battle with the Justice Department over the $85 billion deal, Bloomberg reported.
Under an agreement with the Justice Department, AT&T promised to put Time Warner's Turner Broadcasting in a business unit separate from AT&T's DirecTV business. It also agreed to a firewall between the two. That agreement, which was intended to prevent a full integration of the companies if the government wins its appeal, expires Thursday, Bloomberg noted.
5. -- Shake Shack Stumbles as Forecast Disappoints
The stock fell 3% in after-hours trading on Monday.
Adjusted profit in the quarter was 6 cents a share, ahead of analysts' forecasts of 3 cents, while revenue of $124.3 million beat estimates of $119.1 million. Same-store sales rose 2.3% in the fourth quarter.
Shake Shack said it expects revenue in 2019 of $570 million to $576 million, and sales of more than $700 million in 2020. Analysts were calling for revenue in 2019 of $575.5 million, and revenue in 2020 of $720.5 million.
The company said it expects same-store sales to range from flat to an increase of 1% in 2019 vs. analysts' forecasts of a 0.8% gain.