US OPEN: Wall Street starts Q4 on a positive note

US indices launched today’session higher as markets seems confident that policymakers will come up with a compromise regarding new pandemic relief package. U.S. Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi are set to resume discussions Thursday as both parties are now ‘only’ $600 billion apart in their view of the package’s sticker price. According to The Wall Street Journal, both sides agreed that the package should contain a new round of stimulus checks for households, which analysts see as key to sustaining consumer spending. Meanwhie banking stocks may be in focus during today’s session as Federal Reserve extended its cap on dividend payments and its ban on stock buybacks until the end of the year.
On the data front, Weekly Jobless  Claims data pointed that the labour market continues its slow recovery. Personal spending came above expectations while income fell more than expected as the $600 unemployment benefits expired in the end of July. ISM manufacturing PMI data for September will be published at 3:00 BST
Meanwhile number of new coronavirus cases rose in 27 out of 50 U.S. states in September compared with August, led by an increase of 111% in Wisconsin, according to a Reuters analysis.

 

Pepsico (PEP.US) stock rose 2% in pre-market trade after company posted upbeat quarterly figures. Company earned $1.66 per share while analysts’ expect earnings of $1.49. Revenue also came in above estimates. Quarterly sales grew by more than 5% as consumers bought more Tostitos and pancake mixes. PepsiCo expects to earn $5.50 per share for the full year, above the consensus forecast of $5.36.

 

Conagra (CAG.US) posted quarterly earnings of 70 cents per share, 13 cents a share above market expectations. Revenue  also beat analysts' forecasts, boosted by a 15% increase in organic net sales. The food producer raised its quarterly dividend to 27 1/2 cents per share from the prior 21 cents a share.

 

Amazon.com (AMZN.US) – Pivotal Research increased its price target for Amazon to $4,500 per share  from $3,925 a share, calling Amazon the best mega-cap stock on a multi-year basis.

 

Starbucks (SBUX) – The coffee chain increased its quarterly dividend to 45 cents per share from 41 cents a share. The dividend will be paid on Nov. 27 to shareholders of record on Nov. 12. "The board's decision to raise our quarterly dividend demonstrates confidence in the strength of our recovery and the robustness of our long-term growth model," Chief Executive Kevin Johnson said in a statement.

 

Goldman Sachs (GS.US) proceed forward with a “modest number of layoffs,” after suspending job cuts earlier this year in light of the pandemic. According to Bloomberg,  job cuts will total about 400, or about 1% of bank's workforce.

 

Marathon Petroleum (MPC.US) will cut 12% of its workforce or 2,050 jobs, due to weak energy prices, lower demand and a global supply issues. It will take a $175 million charge as part of the restructuring.

Tesla (TSLA.US) will lower the price of its China-made Model 3 by about 8%. The new standard Model 3 will include a cheaper battery.