Stock Market Update: Berkshire Hathaway Surges, Fed Rate Hopes Rise.
Stock futures opened higher on Monday, buoyed by the prior week’s strong performance following a weaker-than-expected jobs report. The Dow and Nasdaq climbed 1.1% and 1.4%, respectively, while the S&P 500 edged up 0.5%. Market sentiment turned positive as traders anticipated that the Federal Reserve may cut interest rates earlier than expected, given the cooled-down job market, easing concerns about an overheating economy.
In premarket trading, Berkshire Hathaway’s Class A and Class B shares rose 1.1% and 0.6%, respectively, following a robust report showing increased operating earnings and a record cash reserve. Both classes have surpassed a 10% increase this year, outperforming the broader market’s 7% gain. Investors are also closely monitoring Disney and Uber’s earnings this week, alongside Reddit's first earnings release post-IPO.
About Earnings
Barclays strategist Emmanuel Cau noted, "Earnings beats have rebounded in Q1, helped by margins." Despite occasional misses, overall market resilience has tempered the downside for equities. Here’s a quick glance at the key earnings to watch this week:
| Day | Company | Time |
|---|---|---|
| Monday | Spirit Airlines | Before the bell |
| Monday | Palantir Technologies, Lucid Group | After the bell |
| Tuesday | Walt Disney, Spirit AeroSystems, Nikola | Before the bell |
| Tuesday | Reddit, Lyft, Virgin Galactic, Rivian Automotive | After the bell |
| Wednesday | Uber Technologies, Shopify | Before the bell |
| Wednesday | Airbnb, Instacart, Bumble, Beyond Meat | After the bell |
| Thursday | Warner Bros. Discovery, Tapestry | Before the bell |
| Thursday | Sweetgreen | After the bell |
Premarket Movers:
| Ticker Name | Details |
|---|---|
| Berkshire Hathaway | Class A shares traded up 1.2% early Monday after the conglomerate posted 39% year over year growth in operating profit. The Warren Buffett-led business also saw its cash holdings rise to record levels, approaching $200 billion. |
| Paramount | Shares popped 2.4% following a report that the owner of Paramount Pictures and CBS Entertainment Group began formal acquisition negotiations with a group led by Sony Pictures Entertainment and Apollo. Elsewhere, Warren Buffett admitted over the weekend that he sold the entire Berkshire stake in Paramount at a loss. |
| Li Auto | U.S. shares of the Chinese electric vehicle maker jumped 6.7% on the back of solid order data for the L6 model. The L6 first began deliveries last month. |
| Tyson Foods | Shares gained 2.1% after Tyson posted fiscal second-quarter adjusted earnings of 62 cents per share, more than the 39 cents per share expected by analysts polled by StreetAccount. On the other hand, revenue of $13.07 billion fell short of the consensus estimate of $13.15 billion. |
| Starbucks | Shares moved 1% higher following a LinkedIn post by former CEO Howard Shultz, who told the coffee chain it needs to fix its U.S. operations -- and how to go about it. Starbucks issued weaker-than-expected quarterly earnings and revenue last week. |
| Victoria’s Secret | The intimate apparel stock dropped 5% before the bell. Morgan Stanley downgraded Victoria’s Secret to underweight and cut its price target, citing expectations for negative EPS revisions and a tough second half for specialty retail. |
| United States Steel | Shares of the Pittsburgh-based steelmaker rose more than 2% after Morgan Stanley upgraded it to overweight from equal weight. U.S. Steel shares have room to rise thanks to internal improvements, even if the Nippon Steel buyout deal collapses, Morgan Stanley said in a note. |
| Coinbase | The crypto stock rose 2.4% after Barclays hiked its price target, implying less downside ahead for shares. The bank’s move came after Coinbase reported better-than-forecast earnings last week. |
| Johnson Controls | The building technology stock dipped 1.1% following a UBS downgrade to neutral from buy. UBS said Johnson Controls was lagging peers and has a difficult path to meet its 2024 outlook. |
