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Stocks opened effectively flat Monday, as investors geared up for a busy week of earnings reports, including FANG stocks Google parent Alphabet (GOOGL), Facebook (FB) and Amazon.com (AMZN), a policy vote from the Federal Reserve and a first look at second-quarter GDP estimates.
The Nasdaq composite crept to very thin gains, while the S&P 500 and the Dow Jones industrial average dipped a fraction into the red.
Google parent Alphabet reports after today’s close, along with some other key names including Cadence Design Systems (CDNS). Hasbro (HAS) and Halliburton (HAL) were early movers, after rolling out earnings reports early Monday.
Markets early in the week will keep an ear on testimony from several key Trump administration figures before the Senate and House intelligence committees regarding contacts with Russian officials and others during the 2016 presidential campaign. The Federal Reserve swings into its two-day meeting Tuesday, which wraps with a policy announcement Wednesday afternoon.
Halliburton, PetMed Jump; Caterpillar Upgraded
PetMed Express (PETS) vasulted 10% higher at the open as investors cheered a 41% earnings gain and a 10% increase in revenue during the second quarter, both well ahead of analyst targets. Online sales rose 12% and now comprise 84% of the company total. Shares are extended and taking out new highs after a rebound from support at the stock’s 10-week line.
Caterpillar (CAT) jumped 1.3% to lead the Dow as BMO Capital raised the stock to outperform, from market perform, just ahead of its second-quarter report, scheduled for early Tuesday. Caterpillar shares are extended and scratching out new highs, after clearing a two-month flat base in April.
Goldman Sachs (GS) slipped 0.5% as UBS downgraded the stock to neutral from buy, just ahead of Wednesday’s FOMC decision. Goldman shares saw some heavy selling last week, as the stock cut below its 10-week moving average, taking a divot out of the right side of its four-month basing effort.
WebMD (WBMD) was an early high flier, opening up 20% on news that it would be taken private by KKR’s Internet Brands unit in a deal valued at $2.8 billion. WebMD had announced in February it was exploring alternative strategies. The companies expect the deal to close in the fourth quarter.
Neuroderm (NDRM) vaulted 16% after agreeing to a takeover bid from Japan’s Mitsubishi Tanabe Pharma at 39 per share, an 18% premium to Friday’s closing price. Neuroderm is extended after clearing a double-bottom base in June, ending Friday up 49% since the start of the year.
Netherlands-based Koninklijke Philips (PHG) muscled up 4% in earlytrade. The diversified electronics heavyweight reported a 36% surge in second-quarter earnings and announced a $1.7 billion share buyback initiative. The stock has been fighting to clear a 36.59 buy point in a six-week flat base.
Toymaker Hasbro tanked 8% as its second-quarter earnings beat expectations, but revenue growth of 11% stopped just short of analyst views. The stock has been trading tight and knocking out news highs since clearing a flat base in April, but Monday’s move cut below the stock’s 10-week moving average in heavy trade — a sell signal.
Halliburton slipped 0.1% despite soundly beating analyst expectations for second-quarter revenue and earnings growth. North American revenue rose 24% sequentially as U.S. production and spending continue to recover, the company said, while international results continuing to move sideways. Halliburton shares have rebounded from an early July low, but remain deep in a six-month consolidation.
July PMI, June Home Sales On Deck: Europe Markets Mixed
IHS/Markit releases its U.S. composite July purchasing managers index at 9:45 a.m. ET. Existing home sales for June from the National Association of Realtors are due out at 10 a.m. ET.
China’s markets opened the week higher, with Hong Kong’s Hang Seng index up 0.5% and the Shanghai Composite posting a 0.4% gain. In Japan, Tokyo’s Nikkei 225 dropped 0.6%.
Europe’s top benchmarks remained mixed in afternoon trade, as IHS/Markit PMI data showed economic growth slowing, and as European Union antitrust regulators announced an investigation into a potential auto industry cartel. Frankfurt’s DAX fell 0.3% and the FTSE 100 in London fell 0.9%. The CAC-40 in Paris reversed early losses and gained 0.4%.