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US stock market opens with minor gains, FOMC decision in spotlight
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US30 eyes test of upward trendline
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Shopify (SHOP.US) reports 97% surge in Q2 revenue
Major US stock market indices opened with small gains on Wednesday. Index futures see-sawed during the European session as investors are awaiting a monetary policy decision from the Federal Reserve (7:00 pm BST). Elsewhere, more reports surfaced saying that White House administration and Democrats are far apart on reaching consensus on the next US stimulus bill. Earnings remain main drivers for stocks.
US pending home sales data for June showed sales rising 16.6% MoM (exp. 15% MoM) and 12.7% YoY (exp. 2.2% YoY).
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Source: xStation5
Just like other major stock market indices, Dow Jones (US30) has pulled back from post-pandemic highs recently. The index is nearing an upward trendline and a break below it could be a major warning signal for bulls.In such a scenario, the downward move could extend towards the support zone at 24,700 pts. Respecting the trendline and bouncing higher from the current area could fuel a rally towards new post-pandemic highs with resistance at 28,280 pts being the first big target. FOMC decision scheduled for today's evening is a near-term risk event to watch. However, there is a high chance that the Fed will refrain from taking any actions.
Starbucks (SBUX.US) released a solid Q2 earnings report. Net addition in the number of restaurants came as a surprise. Stock is trading higher today. However, price trades below the upper limit of recent trading range. Source: xStation5
Starbucks (SBUX.US) reported a big plunge in sales in Q2 2020. Comparable sales were 40% down year-over-year. Executives of the company said they expect same store sales to recover more meaningfully in early-2021 in China and the United States. Loss per share of $0.46 was smaller than expected. Company estimates that coronavirus pandemic cause an over $3 billion hit to revenue. Nevertheless, Starbucks opened 130 restaurants in the previous quarter.
General Motors (GM.US) reported smaller Q2 loss per share than expected. Company also said that it will begin repaying deferred compensation payments earlier than planned. General Motors said it will repay compensation on October 1 with 6% interest. The carmaker decided to defer 20% of employees compensation on April 1 in order to preserve cash during the crisis.
Shares of Shopify (SHOP.US) jumped today after the company published its Q2 earnings report. E-commerce company managed to boost its revenue by 97% YoY, to $714.3 million (exp. $513.83 million). Gross merchandise volume increased 119% YoY, to $30.1 billion (exp. $20.6 billion). Company generated net profit of $129.37 million, much higher than expected $1.68 million.
Report from PayPal (PYPL.US) is a major earnings release scheduled for today's after-hours. Payments companies could report strong revenue as customers backed away from cash payments during the coronavirus crisis and favoured electronic payments.
Shopify (SHOP.US) started the day with a big bullish price gap and reached all-time highs. The stock benefits from superb Q2 earnings release. However, gains were trimmed in the early phase of the cash session. Zone at $1,050 is the near-term support to watch. Source: xStation5
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