What's moving markets today: June 6, 2019
StitchFix (SFIX) shares are soaring more than 30% in premarket trading following strong first quarter earnings from the online styling service, our Paul R. La Monica notes:
The company grew the number of active clients to 3.1 million people, an increase 17% year over year.
"The continued strength of our Women’s category and the growth of our Men’s category give us even more confidence in our ability to scale new categories and geographies," CEO Katrina Lake said in a release.
The French automaker said in a new statement it "expresses its disappointment not to have the opportunity to continue to pursue the proposal of FCA."
The company added:
We view the opportunity as timely, having compelling industrial logic and great financial merit, and which would result in a European based global auto powerhouse."
If the merger had gone through, it would have created the world's third largest automaker.
Masanari Takada, a strategist at Nomura, warned in a report this week that an "ominous pattern" is developing in market sentiment that could point to deep losses ahead.
Takada cited the sharp deterioration in an internal equity sentiment index, which is calculated by the Nomura macro and quant strategy teams and is based on unspecified market data.
The recent swings in sentiment look like the ones experienced by the same index at the same point in 2008.
Signet Jewelers (SIG), which owns retailers Jared, Zales and Kay, is glittering despite less-than-shiny sales.
Shares jumped as high as 7% in premarket trading despite reporting a 1.3% drop in sales across all of stores opened more than a year.
Piercing Pagoda was the brightest spot for Signet, where sales leapt 13.5%. It also slightly cut its full-year outlook because of "softening retail traffic."
But the stock jumped because it reported a profit that was above analysts' expectations.
Fiat Chrysler (FCAU) has withdrawn its proposal to merge with French automaker Renault (RNLSY), squashing a deal that would have reshaped the auto industry and created the world's third largest carmaker.
The company said Wednesday that it "has become clear that the political conditions in France do not currently exist for such a combination to proceed successfully."
Earlier in the day, Renault said that the French government had requested its board of directors postpone the vote on the merger.
France, which owns 15% of Renault and is the company's largest shareholder, previously indicated that it would support a merger if the companies protect French jobs and auto plants.
Shares in Renault plunged nearly 7% in Paris on Thursday after the proposal was withdrawn. Fiat Chrysler stock dropped 1.6% in Milan.
The European Central Bank meets today as global trade tensions escalate and the race to find a replacement for president Mario Draghi heats up.
Analysts expect the central bank to outline details on additional cheap loans for banks while maintaining historically low interest rates.
Almost certain to come up: whether Draghi and the ECB would be open to cutting interest rates lower still.
"Draghi may have to adopt a dovish tone again, and, at least, not rule out rate cuts if asked about them," Bank of America Merrill Lynch analysts said recently in a research note.
The US Federal Reserve suggested it could cut rates earlier this week, driving markets higher. Fed Chair Jerome Powell said that he's closely monitoring developments on trade, and that the bank will "act as appropriate to sustain the expansion."
Meanwhile, India's central bank on Thursday gave the country its third consecutive interest rate cut as it tries to get a slumping economy back on track.
US stock futures point to another day of gains as investors stay hopeful that the Federal Reserve could cut interest rates.
- The Dow is poised to rise 70 points, or 0.3%. The Nasdaq and S&P 500 are set for a similar jump.
- European markets opened higher after a mixed session for stocks in Asia. Britain's FTSE 100 rose 0.6%, while Germany's DAX index added 0.5%.
- In Hong Kong, the Hang Seng rose 0.2%, while Japan's Nikkei closed flat. The Shanghai Composite, however, dropped 1.2%.