Stock Market Update

Equity futures point to a mixed open this morning as investors assess another sizable batch of earnings and monitor geopolitical developments in the Middle East.

The major averages are coming off a mostly lower finish in which select high-profile tech names finally met some resistance after a record-setting run. The S&P 500 notched a record intraday high before finishing lower for the day, the DJIA extended its record run, and the Nasdaq underperformed amid some volatility in semiconductor stocks.

Similarly, futures tied to the Nasdaq are lower this morning after the latest batch of earnings reports, with several key memory names moving lower on underwhelming guidance despite beating earnings estimates.

On the macro front, oil prices are stable this morning, with NBC News reporting the U.S. and Iran are close to reaching a deal to reopen the Strait of Hormuz, though Iran has insisted on some limited control of the waterway.

Additionally, Financial Times reports Fed Chairman Kevin Warsh will keep his style of limited communication, but is open to a September rate hike if inflation readings come in hot.

The market will receive preliminary Q2 productivity (Briefing.com consensus 0.8%) and unit labor cost (Briefing.com consensus 1.7%) readings at 8:30 a.m. ET, alongside the weekly initial jobless claims (Briefing.com consensus 200K).

In corporate news:

• Applovin (APP 338.80, -79.00, -19.0%) reported EPS in line and missed revenue expectations.
• SanDisk (SNDK 1,218.87, -131.63, -9.8%) beat EPS expectations by $4.29, beat revenue expectations, and guided Q1 EPS in-line with revenues below consensus.
• Western Digital (WDC 443.92, -75.25, -14.5%) beat EPS expectations by $0.25, beat revenue expectations, and guided Q1 EPS above consensus with revenues in-line.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region ended Thursday on a mixed note with South Korea's Kospi (-4.6%) facing renewed selling. Japan's Nikkei: -0.9%, Hong Kong's Hang Seng: -1.5%, China's Shanghai Composite: +0.6%, India's Sensex: +0.5%, South Korea's Kospi: -4.6%, Australia's ASX All Ordinaries: +0.5%.

In news:

• Japanese debt outperformed after Finance Minister Katayama said that Japan will not rely on new debt issuance to make up for tax revenue shortfalls.
• There was also a solid 30-yr JGB auction.
• China's Ministry of Commerce will tighten restrictions on exports of drones to the U.S. Fitch opined that the Bank of Japan will have to continue hiking rates in order for the yen to continue its rise off a multi-decade low against the dollar.

In economic data:

• South Korea's June Current Account surplus $49.73 bln (last surplus of $38.61 bln)
• Australia's June Building Approvals 7.2% m/m, as expected (last -1.6%); 8.9% yr/yr, as expected (last 5.5%). June trade surplus AUD1.929 bln (expected deficit of AUD1.060 bln; last deficit of AUD2.367 bln). June Imports -0.2% m/m (last 0.9%) and Exports 9.6% m/m (last -7.6%)

Major European indices trade mostly higher with Spain's IBEX (+1.1%) pacing the advance with leadership from banks and industrial names. STOXX Europe 600: +0.4%, Germany's DAX: +0.2%, U.K.'s FTSE 100: -0.1%, France's CAC 40: +0.6%, Italy's FTSE MIB: +1.0%, Spain's IBEX 35: +1.1%.

In news:

• The European Central Bank's latest economic bulletin acknowledged elevated inflation and presence of risks to the upside.
• Siemens, Deutsche Telekom, and Persimmon reported strong results.

In economic data:

• Eurozone's June Retail Sales -0.3% m/m (expected 0.1%; last 0.4%); 0.7% yr/yr (expected 1.0%; last 1.9%)
• Germany's June Factory Orders 3.1% m/m (expected 0.5%; last 0.3%)
• France's final Q2 nonfarm payrolls -0.1% qtr/qtr, as expected (last -0.1%)
• Italy's June Industrial Production -1.0% m/m (expected 0.3%; last -0.3%); -0.6% yr/yr (expected 1.0%; last 1.2%)
• Spain's June Industrial Production 1.1% yr/yr (last 3.1%)
• Swiss July Unemployment Rate 3.1%, as expected (last 3.1%)