Dow Jones Industrial Average Futures Up With Banks; Tech Stocks Set to Slump – Schaeffers Research (blog)

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Dow Jones Industrial Average (DJIA) futures are trading modestly above fair value, after the blue-chip index surged more than 143 points yesterday. Financial shares seem ready to lead the S&P 500 Index (SPX) higher, too, after the Fed approved big banks’ capital return plans following a strong showing of stress tests. An upwardly revised final reading on first-quarter gross domestic product (GDP) is also in focus, with the U.S. economy growing at a 1.4% rate in the January-March period, versus the previous 1.2% estimate. Plus, oil prices are signaling a sixth straight win, with August-dated crude futures up 1.2% at $45.26 per barrel. However, with tech stocks set to resume their slump, futures on the Nasdaq-100 Index (NDX) are lower.

Continue reading for more on today’s market, including:

  • The tech signal flashing for the first time in years. 
  • The latest stock popping on a FAANG partnership.
  • drug stocks toying with new lows.
  • Plus, Valeant pops on asset sale, FDA nod; a volatile day of trading for Walgreens, Rite Aid; and Citigroup’s record buyback.

us stock index futures june 29

5 Things You Need to Know Today
  

  1. The Chicago Board Options Exchange (CBOE) saw 815,362 call contracts traded on Wednesday, compared to 552,385 put contracts. The single-session equity put/call ratio jumped to 0.68, and the 21-day moving average stayed at 0.63.
  2. Valeant Pharmaceuticals Intl Inc (NYSE:VRX) has completed the all-cash sale of its Dendreon Pharmaceuticals unit to Sanpower Group for $819.9 million. Plus, the Food and Drug Administration (FDA) has accepted Valeant subsidiary Salix Pharmaceuticals’ marketing application for its bowel cleanser. VRX stock is trading 3.9% higher ahead of the bell, on track to open at its highest level since November.
  3. Shares of Walgreens Boots Alliance Inc (NASDAQ:WBA) have surged 5.1% in electronic trading, after the firm said it will purchase 2,186 stores from Rite Aid Corporation (NYSE:RAD) for $5.18 billion — abandoning merger plans between the two drugstore chains. RAD stock has plunged 21.9%, while Fred’s — which had a hand in the takeover deal — is set gap down 20% at the open. Separately, WBA reported better-than-expected earnings, while RAD earnings fell short of estimates.
  4. Citigroup Inc (NYSE:C) announced plans to repurchase up to $15.6 billion in common stock over the next 12 months — the bank’s biggest buyback on record — and will double its quarterly dividend payment to 32 cents per share. C stock is 3.5% higher in pre-market trading, on pace to open at its highest perch since January 2009.
  5. Traders will weigh weekly jobless claims, while St. Louis Fed President James Bullard will speak in London. Meanwhile, Nike (NKE), Micron Technology (MU), ConAgra (CAG), and Constellation Brands (STZ) will report earnings.

Buzz Stocks June 29

Overseas Trading

Stock markets in Asia enjoyed a positive session, following the lead of their U.S. counterparts. News that domestic banking giants passed the Fed’s stress tests lifted financial shares throughout Asia, with HSBC’s Hong Kong-listed shares posting notable gains. As a result, the Hang Seng blew past its index peers with a 1.1% gain. China’s Shanghai Composite also closed higher, picking up 0.5%, as material stocks rallied thanks to a weaker dollar. In Japan, the Nikkei also added 0.5%, and South Korea’s Kospi closed 0.6% higher. 

It’s more of a mixed picture in Europe. Bank stocks are doing their part to lift the major indexes, as are mining shares, but a strengthening euro — the currency just touched a one-year peak — is capping stocks’ upside. While the FTSE 100 has managed to rise 0.5% so far, the French CAC 40 and German DAX are both lower at midday, sporting losses of 0.5% and 0.1%, respectively.