As of this morning, September E-Mini S&P 500 futures (ESU23) are down -0.43%, and Sep Nasdaq 100 E-Mini futures (NQU23) have declined by -0.59%.
The stock indexes are facing downward pressure due to disappointing quarterly earnings results, negatively impacting market sentiment. In pre-market trading, ZoomInfo Technologies (NASDAQ:ZI) witnessed a significant drop of more than -18% after reporting weaker-than-expected Q2 revenue. Similarly, Zebra Technologies (NASDAQ:ZBRA) is down over -12% following disappointing Q2 net sales.
U.S. stocks are being affected by the fall in European stocks as well. BMW AG experienced a decline of more than -6% after warning about higher costs, while DHL Group tumbled more than -3% after providing weak profit guidance. Concerns about China’s economy are also contributing to dampened global growth prospects, with China’s Jul new home sales registering the largest decline in a year, and the Caixin Jul manufacturing PMI contracting the most in 6 months.
In the pre-market session, the markets are factoring in a 20% probability of a +25 basis points rate hike at the upcoming September 20 FOMC meeting. Global bond yields are showing an upward trend, with the 10-year T-note yield up by +6.0 basis points at 4.019%, the 10-year German bund yield up by +4.9 basis points at 2.541%, and the 10-year UK Gilt yield up by +6.3 basis points at 4.372%.
Overseas stock markets are mixed, with the Euro Stoxx 50 down by -0.94%, China’s Shanghai Composite Index closing unchanged, and Japan’s Nikkei Stock Index recording a +0.92% increase.
The Euro Stoxx 50 is currently facing moderate declines, mainly due to negative corporate earnings results impacting European stocks. BMW AG’s share price dropped by more than -6%, leading other automakers lower, after the company warned about higher supply-chain costs affecting its free cash flow for the year. Man Group Plc also experienced a decline of more than -8% after reporting weaker-than-expected first-half core revenue. Additionally, DHL Group fell more than -3% after providing full-year guidance below expectations. On a positive note, HSBC Holdings Plc and BP Plc saw rises in their stock prices following announcements of new share repurchase programs.
In economic news, the Eurozone Jun unemployment rate remains unchanged at a record low of 6.4%, indicating a stronger labor market than anticipated.
In Germany, the Jul unemployment change unexpectedly declined by -4,000, indicating a stronger labor market compared to expectations of a +20,000 increase. The Jul unemployment rate also unexpectedly fell by -0.1 to 5.6%, showing a stronger labor market than the expected rate of 5.7%.
In China, the Shanghai Composite initially advanced but later settled unchanged. Economic concerns weighed on Chinese stocks, with Jul new home sales falling by the most in a year, and manufacturing activity unexpectedly contracting by the most in 6 months. Property stocks also retreated, with Country Garden canceling a primary share placement amid growing liquidity concerns due to facing $2.9 billion in debt payments for the rest of the year. Chinese stocks initially rose after China Central Television reported that China’s State Council called on cities to introduce policies ensuring the healthy development of their property markets.
The China Jul Caixin manufacturing PMI declined by -1.3 to a 6-month low of 49.2, weaker than the expected 50.1.
Among other stock movements in the pre-market session, Rambus (NASDAQ:RMBS) tumbled more than -8% after issuing guidance that missed estimates. Rockwell Automation (NYSE:ROK) fell more than -6% after reporting Q3 adjusted EPS weaker than expected. Sofi Technologies (NASDAQ:SOFI) dropped more than -3% after a downgrade from Keefe, Bruyette & Woods. Estee Lauder (NYSE:EL) slid more than -1% following a downgrade from Citigroup. Rivian Automotive (NASDAQ:RIVN) fell more than -2% after a downgrade from Cantor Fitzgerald. Western Digital (NASDASQ:WDC) dropped more than -2% after forecasting a wider-than-expected Q1 adjusted loss. Harmonic (NASDAQ:HLIT) slumped more than -10% after reporting weak Q2 net revenue and cutting its full-year net revenue estimate. Varonis Systems (NASDAQ:VRNS) rallied more than +11% after raising its full-year total annual recurring revenue estimate. Merck & Co (NYSE:MRK) gained more than +1% after reporting strong Q2 sales and raising its full-year sales forecast. ResMed (NYSE:RMD) rose more than +2% following an upgrade from RBC Capital Markets. Arista Networks (NYSE:ANET) surged more than +14% after reporting better-than-expected Q2 revenue. Uber Technologies (NYSE:UBER) climbed more than +3% after forecasting strong Q3 adjusted Ebitda. Global Payments (NYSE:GPN) jumped more than +6% after reporting Q2 adjusted net revenue above consensus and raising its full-year adjusted revenue forecast.
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