Markets Await New Home Sales Data

Pre-market futures are fluctuating a bit at this hour, starting even with yesterday’s close, then swelling nicely on the tech-heavy Nasdaq. Indexes are carrying these levels more or less straight across presently, with the Dow -12 points at this hour, the S&P 500 +7 points, the Nasdaq +84 points and the small-cap Russell 2000 +1 point.

The biggest economic news this week has yet to come. This will take place Friday morning, when Personal Consumption Expenditures (PCE) for May come out. These numbers will inform other economic prints throughout the month, and are the Fed’s preferred metric for deciding on monetary policy. Early PCE data comes out tomorrow, including a second revision of Q1 Gross Domestic Product (GDP).

General Mills Q4 Results Mixed

Ahead of today’s open, the current space in between informal “earnings seasons” still sees the occasional quarterly report. This morning it’s the fiscal Q4 for household food brands giant General Mills (GIS), the producer of Cheerios, Chex, Pillsbury, Nature Valley and Blue Buffalo pet food, to name just a few. Results were mixed for the company, with earnings beating expectations but results coming up a tad short.

Earnings of 74 per share outperformed the Zacks consensus by 3 cents (still 25% lower than the $1.01 per share posted in the year-ago quarter), while revenues of $4.56 billion missed estimates by -1.04%. Guidance was slightly disappointing as well, and the stock is trading down -3% on the news. GIS was already down -16% year to date.

What to Expect from the Stock Market Today

After the regular trading day gets underway, New Home Sales for May will hit the tape. Expectations are for a big cooling off to 695K seasonally adjusted, annualized units from the previous month’s 12-month high of 743K. Mortgage rates remained elevated last month, within a range of 6.76-7.06%, which provides a natural headwind. On Monday, Existing Home Sales actually outperformed expectations.

Fed Chair Jerome Powell spends his second of two days on Capitol Hill, today across the rotunda to testify before the Senate Banking Committee about the state of the economy. Yesterday, Powell reiterated his message from last week’s Fed meeting that uncertainty regarding tariff policy going forward is keeping interest rate cuts at bay.

After today’s close, Idaho-based data storage giant Micron (MU) reports fiscal Q3 results. Expectations are enormous, as they tend to be these days in the semiconductor space. Earnings are expected to have bloomed +156% year over year, with revenues estimated up +30%. Pre-market trading has Micron -1% at his hour, but up more than +50% year to date. 

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This article originally published on Zacks Investment Research (zacks.com).

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