Tuesday’s earnings spotlight is on Walmart (NYSE:WMT), set to report before the market opens. The retail giant is expected to showcase another strong quarter, as its focus on low-cost essential goods continues to attract budget-conscious consumers amid softening demand. Analysts predict a revenue increase of approximately 4% and a 5% rise in adjusted operating income, according to LSEG estimates.
Walmart has also begun reaping the rewards of its investments in e-commerce and advertising, enabling the company to grow operating income at a faster pace than revenue.
Analysts at Oppenheimer noted, *”We expect another solid all-around performance and a guidance raise, driven by strong top-line momentum across the enterprise and the growth of alternative revenue streams.”* Similarly, Citi analysts highlighted expectations for a *”positive tone from management regarding the holiday season, following a strong back-to-school period, as well as continued confidence in their market positioning and ability to gain share.”*
Walmart’s stock has surged 60% year-to-date, significantly outperforming the S&P 500’s 23% gain and Target’s (NYSE:TGT) nearly 10% increase.
2. Futures dip as Walmart takes center stage
U.S. stock futures edged lower on Tuesday as investors awaited key corporate earnings reports from major companies.
As of 03:40 ET (08:40 GMT), Dow futures were down 65 points, or 0.2%, while S&P 500 and Nasdaq 100 futures slipped 9 points and 50 points, respectively, both dropping 0.2%.
This week’s earnings highlight will be Nvidia’s report on Wednesday, with the AI leader expected to shape market sentiment for the latter half of the week and potentially into year-end. Meanwhile, Walmart’s results [see above] will take center stage earlier in the day.
With about 93% of S&P 500 companies having reported so far, FactSet data shows 75% have exceeded earnings expectations, and over 60% have surpassed revenue estimates.
On the economic front, the U.S. calendar is light, featuring housing data, while Kansas City Fed President Jeffrey Schmid is scheduled to speak later in the day.
U.S. stock futures edged lower on Tuesday as investors awaited key corporate earnings reports from major companies.
As of 03:40 ET (08:40 GMT), Dow futures were down 65 points, or 0.2%, while S&P 500 and Nasdaq 100 futures slipped 9 points and 50 points, respectively, both dropping 0.2%.
This week’s earnings highlight will be Nvidia’s report on Wednesday, with the AI leader expected to shape market sentiment for the latter half of the week and potentially into year-end. Meanwhile, Walmart’s results [see above] will take center stage earlier in the day.
With about 93% of S&P 500 companies having reported so far, FactSet data shows 75% have exceeded earnings expectations, and over 60% have surpassed revenue estimates.
On the economic front, the U.S. calendar is light, featuring housing data, while Kansas City Fed President Jeffrey Schmid is scheduled to speak later in the day.
Goldman Sachs projects that the ‘Magnificent 7’—Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL), Meta Platforms (NASDAQ:META), Microsoft (NASDAQ:MSFT), Nvidia (NASDAQ:NVDA), and Tesla (NASDAQ:TSLA)—will continue to outperform the rest of the S&P 500 in 2024. However, their lead is expected to shrink to just 7 percentage points, the narrowest margin in seven years.
In a note dated November 18, Goldman stated, *”While the ‘micro’ earnings outlook supports the ongoing outperformance of the Magnificent 7, macroeconomic risks, including growth and trade policy, favor the S&P 493—the rest of the index.”*
The bank also forecast an 11% increase in corporate earnings and 2.5% real GDP growth in the U.S. for 2025.
Goldman Sachs cautioned that the broader U.S. equity market faces significant risks heading into 2025, citing potential challenges from tariffs and rising bond yields. However, the brokerage also noted potential upside scenarios, stating, *”A friendlier mix of fiscal policy or a more dovish Fed could mitigate these risks.”*
**4. Trump Media Explores Diversification with Bakkt Acquisition**
Shares of Trump Media & Technology Group (NASDAQ:DJT) edged lower in premarket trading Tuesday, following a 16% surge the previous session. The gains were driven by reports that Donald Trump’s social media company is in advanced talks to acquire digital asset marketplace Bakkt (NYSE:BKKT) in an all-stock deal.
According to the *Financial Times*, Trump Media is pursuing Bakkt as part of its strategy to expand beyond social media. This move follows the recent launch of its crypto initiative, World Liberty Financial.
During his campaign, President-elect Trump positioned himself as a pro-cryptocurrency advocate, vowing to make America the “world capital for crypto and Bitcoin.”
Bakkt, launched by Intercontinental Exchange (NYSE:ICE), the owner of the New York Stock Exchange, saw a massive surge of over 162% on Monday, with trading frequently halted due to volatility.
**5. Crude Supply Concerns Capture Attention**
Crude prices edged lower on Tuesday, giving back some of the sharp gains from the previous session as traders assessed the potential for major supply disruptions.
By 03:40 ET, U.S. crude futures (WTI) were down 0.6% at $68.78 a barrel, while Brent crude dropped 0.5% to $72.92 a barrel.
Oil prices surged by over 3% on Monday following Equinor’s announcement that it had halted production at its Johan Sverdrup oilfield in Norway, the largest in Western Europe.
This outage has raised concerns about oil supply disruptions in the region, further compounded by the Biden administration’s approval for Ukraine to use U.S.-made weapons to strike deep into Russia.
While the war has had minimal impact on Russian oil exports thus far, any potential targeting of oil infrastructure by Ukraine could increase geopolitical pressures on oil markets.
However, the International Energy Agency (IEA) recently projected that global oil supply will comfortably outpace demand by 2025, citing rising production outside the Organization of Petroleum Exporting Countries (OPEC) and its allies.
U.S. production remained near record levels, surpassing 13 million barrels per day. Additionally, the potential appointment of Chris Wright, CEO of Liberty Energy, as the next Secretary of Energy under President-elect Donald Trump is seen as a clear indication of a commitment to increasing domestic fossil fuel production.
