Stock futures leaned toward a lower open Wednesday, as earnings reports and company news drove a busy premarket session.
Futures for the Dow industrials, S&P 500 and Nasdaq 100 all traded about 0.2% below fair market value.
Economic releases due out Wednesday are limited to the weekly oil inventories report from the Energy Information Administration, at 10:30 a.m.ET, and the Treasury budget, at 2 p.m. Oil futures notched higher, with West Texas Intermediate up 0.4%, just below $45 a barrel and effectively flat for the week so far. Gold rose more than 1%, to above $1,278 an ounce, down 1% this week. The dollar was down, and bonds were inching higher.
Staples tumbled 15%, and Office Depot sliced 34% lower in premarket moves on the stock market today after a federal judge blocked the two companies’ $6.3 billion merger effort, citing antitrust concerns. Staples will pay a $250 million breakup fee, and said in a release it will close 50 stores in North America and initiate a $100 million stock repurchase program, along with other measures.
Other retailers also showed some early distress. Fossil Group (FOSL) crumbled 34% as Q1 earnings and revenue, reported late Tuesday, fell more than expected. The company said challenges in the retail environment and in its wholesale channels had intensified.
Macy’s dropped 9% after delivering mixed first-quarter results and lowering full-year EPS and revenue guidance below consensus expectations.
Disney dropped 5%, weighing heavily on the Dow, after reporting late Tuesday fiscal Q2 revenue and earnings that missed analyst targets. Management noted a decline in ESPN subscribers and ad revenue. Shares have been climbing since February, building the right side of a six-month consolidation. The stock ended Tuesday above the midpoint of the potential base and above its 40-week moving average.
Video game maker Electronic Arts powered up 9% before the open after topping fiscal fourth-quarter earnings and revenue views, as well as raising its fiscal 2017 outlook. Electronic Arts is up 22% from a February low, but it has traded horizontally since March, stymied by resistance at its 40-week moving average.
Oil producer Williams popped 6% after Bernstein initiated coverage on the company with an outperform rating and a 25 price target. The stock ended Tuesday below 20 — up 87% from a February low, but still nearly 70% below its June peak.
Amazon.com (AMZN), a key player in Tuesday’s market gains, rose a fraction in premarket trade Wednesday. The stock had popped to a new higher Tuesday, and it is now extended above a 603.34 buy point.
Among IBD 50 stocks, Ubiquiti Networks (UBNT) improved 0.4% in early action. The stock is extended above a 34.49 cup-with-handle buy point, cleared in April. It also just topped an alternate entry at 37.20, ending Tuesday less than 2% above that buy mark.
At the low end of the list, Facebook (FB) has recently been edging higher after clearing a 117.09 buy point in April, but it traded down about 0.2% ahead of Wednesday’s opening bell.
Overseas action was generally quiet, with narrowly mixed trade in China and Japan, and with some moderate selling pressure focused in eurozone markets, particularly on banking sector stocks.