Stocks rise as earnings roll in, stimulus talks continue

Stocks were mostly higher Tuesday, with investor attention still centered on fresh signs of corporate and economic stress from the coronavirus pandemic. The Dow and S&P 500 tracked toward a third straight session of gains.

Quarterly earnings results set for release after market close Tuesday are set to give further indications of the company-level impacts of the pandemic, with blue-chip company Disney (DIS), along with newly public firms Nikola (NKLA), Beyond Meat (BYND) poised to report after market close.

Earlier Tuesday morning, Warner Music Group (WMG) swung to a net loss in its fiscal third quarter results as a lack of live concerts and merchandise sales outweighed a pickup in digital music streaming. And Ralph Lauren’s (RL) fiscal first-quarter results revealed more misery among legacy retailers, with the company’s net sales slumping 66% over last year to drive a wider than expected loss during the quarter.

Shares of Microsoft fell Tuesday morning after closing at a record high a day earlier, with the Redmond, Washington-based company still deliberating a potential acquisition of TikTok’s operations in the US and some other countries, in a move that would expand its consumer-facing business operations. President Donald Trump suggested on Monday that the US government receive a portion of the payment from any sale – from Microsoft or any other firm taking up the Beijing-based social media company.

China’s state-run China Daily newspaper on Tuesday characterized a potential US company purchase of TikTok as “theft,” and suggested it would retaliate if such a deal were to transpire.

Elsewhere in Washington, talks between Democratic and Republican lawmakers over the next round of stimulus aid are set to continue on Tuesday, after House Speaker Nancy Pelosi (D-Calif.), Senate Minority Leader Chuck Schumer (D-N.Y.), Treasury Secretary Steven Mnuchin and White House chief of staff Mark Meadows met for over two hours on Monday to discuss the package. The level of enhanced unemployment insurance benefits remains a sticking point, along with the total funds for other aid for individuals and state and local government programs.

With lawmakers still at an apparent impasse on key issues, Trump told reporters at the White House on Monday he was considering using executive action to impose a moratorium on evictions – a measure which had been included in the previous Covid-19 relief legislation passed in March.

Later on Tuesday, earnings season will roll on, with Disney set to report quarterly results after market close. The company is expected to have swung to a net loss of more than $1 billion during the third quarter, with drastically reduced theme parks attendance due to closures and partial reopenings weighing heavily on the company. Its nascent streaming business, however, is set to be a bright spot, with the Disney+ subscriber base already having grown to 54.5 million subscribers as of early May, within six months of launch.

12:01 p.m. ET: S&P 500, Dow rise while Nasdaq holds near the flat line

The S&P 500 and Dow each held in positive territory in intraday trading, while the Nasdaq struggled for direction. The materials company Dow Inc. and McDonald’s led gains in the 30-stock index, with the Dow higher by more than 100 points.

The energy, materials and real estate sectors led advances in the S&P 500 while the health-care and information technology sectors lagged, reversing the leadership seen during Monday’s session. Facebook, Google and Microsoft declined, and Amazon and Apple rose only marginally after rallying over the past several weeks.

10:22 a.m. ET: US factory orders beat expectations in June, rising for second straight month

Factory orders in the US rose 6.2% in June following a 7.7% rise in May, the Commerce Department said Tuesday, in a signal of the manufacturing sector’s recovery before coronavirus cases resurged in some parts of the country. Consensus economists expected a 5% rise in June, according to Bloomberg data.

Despite the rise, however, orders for new US-made products remained below levels from February, before the pandemic hit.

9:38 a.m. ET: Stocks open lower after recent earnings disappoint

Here were the main moves in markets, as of 9:38 a.m. ET:

  • S&P 500 (^GSPC): -6.56 points (-0.2%) to 3,288.05

  • Dow (^DJI): -36.63 points (-0.14%) to 26,627.77

  • Nasdaq (^IXIC): -27.77 (-0.27%) to 10,872.6

  • Crude (CL=F): -$0.44 (-1.07%) to $40.57 a barrel

  • Gold (GC=F): +$6.10 (+0.31%) to $1,992.40 per ounce

  • 10-year Treasury (^TNX): -3.3 bps to yield 0.53%

9:15 a.m. ET: Ford shakes up C-suite as CEO Jim Hackett steps down, Jim Farley set to assume role

Ford Motor Company (F) announced Tuesday that CEO Jim Hackett will step down and retire from the company on Oct. 1 and will be replaced by Chief Operating Officer Jim Farley.

Farley took on the role of COO earlier this year. The CEO shift at Ford comes as the automaker prepares for the launch of its redesigned F-150 this fall.

7:40 a.m. ET: UK oil major BP slashes dividend; Bayer swings to a loss

European companies BP PLC and Bayer each reported tough quarterly results Tuesday morning as the coronavirus pandemic weighed on each of their respective business operations.

BP (BP) slashed its dividend for the first time in a decade, and said it intends to shift its business more heavily toward greener low-carbon energy after the pandemic crushed demand across oil majors. The new dividend payment will be 5.25 cents per share quarterly, from 10.5 cents.

Bayer (BAYN.DE) posted a net loss of 9.5 billion euros, or about $11.2 billion, in the second quarter, with some of this coming from legal provisions relating to a settlement with plaintiffs that said Bayer’s Roundup herbicides caused cancer.

The company slashed its outlook to see sales growth of between 0% and 1% this year, down from a 3% to 4% rise seen previously, due in part to disruptions from the pandemic. Second-quarter sales fell 6.2% to just over 10 billion euros, with pharmaceutical and consumer care segment declining as consumers veered away from nonessential doctors’ visits and held off on purchases of new products they’d stocked up on earlier on during the pandemic.

7:15 a.m. ET: Tuesday: Stock futures edge lower

Here were the main moves in markets, as of 7:16 a.m. ET:

  • S&P 500 futures (ES=F): 3,280.5, down 8 points, or 0.24%

  • Dow futures (YM=F): 26,531.00, down 27 points, or 0.1%

  • Nasdaq futures (NQ=F): 11,018.25, down 26 points, or 0.24%

  • Crude (CL=F): -$0.69 (-1.68%) to $40.32 a barrel

  • Gold (GC=F): +$6.50 (+0.33%) to $1,972.50 per ounce

  • 10-year Treasury (^TNX): -2.7 bps to yield 0.536%

6:01 p.m. ET Monday: Stock futures open little changed to slightly lower

Here were the main moves in equity markets, as of 6:01 p.m. ET:

  • S&P 500 futures (ES=F): 3,287.00, down 1.5 points, or 0.05%

  • Dow futures (YM=F): 26,548.00, down 10 points, or 0.04%

  • Nasdaq futures (NQ=F): 11,043.5, down 0.75 points, or 0.01%

A trader walks in front of the New York Stock Exchange (NYSE) on May 26, 2020 at Wall Street in New York City. – Wall Street stocks surged early May 26, 2020 on optimism about coronavirus vaccines as the New York Stock Exchange resumed physical floor trading for the first time since late March. About five minutes into trading, the Dow Jones Industrial Average was up 2.3 percent at 25,023.76. The broad-based S&P 500 gained 2.0 percent to 3,013.04, while the tech-rich Nasdaq Composite Index advanced 1.6 percent to 9,468.96.The gains came after a ceremony presided over by New York Governor Andrew Cuomo, who wore a mask as he rung the opening bell to signal the start of the day for traders, also clad in masks and separated by plexiglas. (Photo by Johannes EISELE / AFP) (Photo by JOHANNES EISELE/AFP via Getty Images)

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