Here are the most important news, trends and analysis that investors need to start their trading day:
- Stocks look steady with shoppers undeterred by higher prices
- Walmart, Home Depot top expectations on earnings, revenues
- Bitcoin drops toward $60,000 as major cryptos plunge
- Taxes are not the only reason Elon Musk is selling Tesla stock
- Bankers, traders set for biggest bonuses since Great Recession
1. Stocks look steady with shoppers undeterred by higher prices
U.S. stock futures were little changed Tuesday as investors looked to strong earnings from Walmart and Home Depot and better-than-expected retail sales data from the government. October retail sales rose 1.7% overall. Excluding autos, sales also increased 1.7%, compared to estimates of 1%. The Dow Jones Industrial Average, the S&P 500 and the Nasdaq dipped Monday, coming off their first negative weeks in six. However, all three stock benchmarks were still less than 1% away from their last record high closes on Nov. 8. The 10-year Treasury yield ticked lower Tuesday but remained above 1.6%.
2. Walmart, Home Depot top expectations on earnings, revenues
Shares of Walmart rose 1% in premarket trading after the retail giant reported on Tuesday adjusted third-quarter earnings and revenue that beat expectations. Walmart won back grocery shoppers as it used its size to help manage through snarled supply chains and price pressures. Walmart's e-commerce sales in the U.S. grew 8% from the year-ago quarter, or 87% on a two-year basis. The company boosted full-year earnings guidance.
Home Depot shares rose 1% in the premarket after the company issued on Tuesday adjusted third-quarter earnings and revenue that exceeded expectations. Same-store sales climbed 6.1% in the quarter, solidly beating estimates of a 2.2% rise as consumers continue to fix up their homes during Covid, albeit at a slower rate than a year ago. In Q3 2020, same-store sales surged nearly 25%.
3. Bitcoin drops toward $60,000 as major cryptos plunge
Bitcoin and other digital currencies fell sharply on Tuesday retreating from near-record highs. The world's largest digital coin dropped toward $60,000 as China's state planner said it will continue to clean up crypto mining in the country. Earlier this year, Beijing cracked down on bitcoin mining leading to an exodus of miners. China, which is facing an energy crunch, is concerned about the amount of power that it takes to conduct mining operations, which creates new coins, and maintains a log of transactions. Miners get some bitcoin for their troubles.
4. Taxes are not the only reason Elon Musk is selling Tesla stock
Tesla CEO Elon Musk faces a potential tax bill of more than $10 billion on stock options that he was granted in 2012. On Monday, Musk sold another $930 million in shares to pay taxes on options that he exercised on 2.1 million shares. That brings his total options exercises to about $4.6 billion since Nov. 8. Shares he sold to meet tax withholding obligations were worth to $2 billion. Most of last week's stock sales, $5.7 billion worth, were from Musk's existing shares.
5. Bankers, traders set for biggest bonuses since Great Recession
Wall Street is set to see the highest bonuses since the Great Recession after a busy and profitable 2021, according to a pay consultancy report. Overall bonuses for investment banking underwriters are forecast to jump 30% to 35% from the year prior, while investment banking advisors and equities traders can expect a 20% to 25% year-over-year bonus increase. Companies are paying up in a competitive job market to retain top talent and nab new hires to tackle unprecedented workloads due to the rebound in business activity.
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