Stock futures rose Wednesday evening as investors awaited a deluge of earnings results set for release Thursday morning, along with new economic data on the state of the consumer and labor market as the pandemic continues. Investors are excited about good news from a phase 1 study of the biotech’s coronavirus vaccine candidate. SocialChorus, a startup that helps distribute communications internally in a similar way marketers reach customers externally, announced a $100 million investment today led by Sumeru Equity Partners. With this investment, the firm has bought a majority stake in the company. As part of today’s deal, Sumeru will be adding three members to the SocialChorus board. […] Here are the biggest calls on Wall Street on Wednesday Monaeo, a company that helps taxpayers track and store their location data to show to tax authorities, said its business has more than doubled in May and June over last year. Stock futures surged after Moderna said its coronavirus vaccine candidate produced antibodies in all patients participating in a trial.
Stock futures rose Wednesday evening as investors awaited a deluge of earnings results set for release Thursday morning, along with new economic data on the state of the consumer and labor market as the pandemic continues.
At the close of the regular session Wednesday, the S&P 500, Dow and Russell 2000 each rose to their highest levels in five weeks, as optimism over a potential vaccine came alongside stronger than expected earnings results from Goldman Sachs (GS). Anthony Fauci, Director of the National Institute for Allergy and Infectious Diseases, told Reuters he was optimistic that the US would have an effective vaccine by the end of the year.
Nevertheless, companies and individuals across the country continue to contend with the pandemic in the meantime. Walmart (WMT), Kroger (KR) and Kohl’s (KSS) on Wednesday became some of the latest companies to require that customers wear masks while shopping, and the National Retail Federation called on all retailers to adopt nationwide policies of mask-wearing.
The new requirements came as the US continued to grapple with an ongoing rise in coronavirus cases, still especially in the South and West. California on Wednesday recorded its second-highest one-day rise at 11,126 new cases, while hospitalizations were at a record 6,786. Cases in Florida and Arizona rose at slower paces than each states’ respective average over the last seven days.
The ongoing economic impacts of the coronavirus pandemic will be captured in two key reports Thursday morning, including the Labor Department’s weekly jobless claims print and Commerce Department’s June retail sales report. The former is expected to show another 1.25 million individuals filed new unemployment claims last week, for a 15th straight week of declines but a still-elevated level relative to the period before the pandemic. And retail sales are expected to extend their rebound for another month, rising 5% in June after a record 17.7% month over month gain in May.
Meanwhile, earnings results are set to continue rolling in on Wednesday, with a number of giants across industries poised to report. Bank of America (BAC), Morgan Stanley (MS), Johnson & Johnson (JNJ), Domino’s Pizza (DPZ) and Abbott Laboratories (ABT) will be among the headlining reporters before market open. Streaming giant Netflix (NFLX) is set to report results after market close.
Here were the main moves at the start of the overnight session for U.S. equity futures, as of 6:07 p.m. ET:
S&P 500 futures (ES=F): 3,226.00, up 6.5 points or 0.2%
Dow futures (YM=F): 26,840.00, up 75 points, or 0.28%
Nasdaq futures (NQ=F): 10,693.5, up 10.25 points, or 0.1%
NEW YORK, NY – MARCH 12: A woman wearing a protective mask walks past the New York Stock Exchange on March 12, 2020. in New York City. The Dow Jones industrial average fell 2,352.60 points, a decrease of almost 10% and the largest since 1987. (Photo by Pablo Monsalve/VIEWpress/Corbis via Getty Images)
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Author: Emily McCormickReporter
Why Moderna Stock Is Surging Today
Shares of Moderna (NASDAQ:MRNA) are surging today, up 12.7% as of 10:07 a.m. EDT. The nice gain came after the biotech announced on Tuesday the publication of results from a phase 1 study of COVID-19 vaccine candidate mRNA-1273 in The New England Journal of Medicine. The clinical study was led by the National Institute of Allergy and Infectious Diseases (NIAID).
Those results revealed that neutralizing antibodies (which can prevent infection by the novel coronavirus that causes COVID-19) were found in all 45 participants involved in the phase 1 study. Moderna’s experimental vaccine also appeared to be generally safe and well tolerated.
Image source: Getty Images.
Moderna announced positive preliminary results from the phase 1 study on May 18, 2020. However, the company didn’t provide as many details in that announcement. The data published in The New England Journal of Medicine was even better than expected.
The primary objectives of a phase 1 clinical study are to evaluate a candidate’s safety and determine the optimum dosing. Both objectives seem to have been readily met in this case.
Moderna’s mRNA-1273 didn’t produce any serious adverse events. The adverse events that did occur were generally mild to moderate in severity and were resolved relatively quickly. The study also showed that the 100-microgram dose of the vaccine candidate was the best dosage to use.
But the observation of neutralizing antibodies in all participants receiving mRNA-1273 really captured investors’ attention. Even better, the levels of these neutralizing antibodies were much higher than levels seen in patients who recovered from COVID-19. This is an encouraging sign that could point to the potential for mRNA-1273 to be effective in preventing infection by the novel coronavirus.
Moderna is currently evaluating mRNA-1273 in its own phase 2 study. The next major catalyst for the biotech stock could come when results from this study are announced. The main thing to watch with Moderna, though, is the phase 3 study of mRNA-1273, which is scheduled to begin on July 27.
Author: Keith Speights
Sumeru Equity Partners buys majority stake in SocialChorus with $100M investment – TechCrunch
SocialChorus, a startup that helps distribute communications internally in a similar way marketers reach customers externally, announced a $100 million investment today led by Sumeru Equity Partners. With this investment, the firm has bought a majority stake in the company. As part of today’s deal, Sumeru will be adding three members to the SocialChorus board.
“Sumeru Equity Partners is making a majority investment in the company but also well capitalizing the business for future growth,” Mark Haller, principal at Sumeru told TechCrunch.
The company previously raised $47 million, according to Crunchbase data. Haller says this is not a buyout, so much as a partnership with those previous investors. “We’re seeing continued partnership with existing investors and we’re coming in and making that majority investment, and we’ll also be making another investment in the balance sheet,” he said.
What Sumeru is getting is a company that helps with internal communications using marketing techniques, says company CEO Gary Nakamura. “You can run campaigns with targeting segmentation and all the telemetry back that you need as a leader, as a manager, as an organization to understand how your communications are landing with your workforce,” Nakamura told TechCrunch.
The target is large companies and customers, including big names like Ford, Archer Daniels Midland and Boeing. The company reports it has 120 large customers around the world, and the business has been growing at 50% year over year.
While the company is getting this infusion of cash from Sumeru, Nakamura says he will continue to try to manage the company in a thoughtful way, and that means being careful about how they hire beyond the 120 employees the company already has.
“What we have built is a business that doesn’t require a lot of heads to run it. We can maintain a 50% growth rate with financial discipline that we’ve implemented. Historically that is what we’ve been able to do,” he said.
Sumeru Equity Partners is a private equity firm based in San Francisco. It targets mid-market companies, according to the company website, and then tries to apply operational efficiency by working with them on areas like product strategy, go-to-market acceleration and organizational development, with the goal of building up the company and taking it to exit.
Author: Ron Miller
Here are Wednesday’s biggest analyst calls of the day: Apple, Moderna, Western Digital, Gap, & more
A Western Digital office building is shown in Irvine, California, U.S., January 24, 2017.
Mike Blake | Reuters
(This story is for CNBC PRO subscribers only.)
Here are the biggest calls on Wall Street on Wednesday:
Evercore said in its initiation of the beer maker that it sees “upside” to consesus and that the company was the only publicity-traded play on hard seltzer.
“SAM is the only publicly-traded play on the booming hard seltzer category, with Truly accounting for ~30% of revenue last year, going to ~50% in 2020E and ~70% in 2022E. Truly weathered this year’s competitive onslaught and came out stronger. While this is not lost on investors, with the stock up ~90% over the past 2 years, our proprietary U.S. Beer Market Model, analysis of Numerator panel data, and margin driver analysis supports upside to consensus.”
JPMorgan said in its downgrade of American Express that it thinks the company’s model will remain “pressured” as wealthier consumers reduce travel among other things amid the coronavirus pandemic..
“Spend-driven model likely to remain pressured as high-income consumers reduce discretionary and leisure travel spend and corporate T&E likely to remain pressured into 1H21. Potential return at low end of our sector coverage.”
Author: Michael Bloom
The app financial traders are using to avoid a New York City tax during the coronavirus pandemic
A growing number of hedge-fund and private-equity partners are using a new app that helps them avoid a special New York City tax if they’ve been working outside the city.
Monaeo, a company that helps taxpayers track and store their location data to show to tax authorities, said its business has more than doubled in May and June over last year. Monaeo said it’s seeing especially strong demand from partners of hedge funds, private equity firms and other financial firms looking to challenge a New York City business tax because they’ve been working outside the city during the coronavirus pandemic.
“These are some of the highest earners,” said Anupam Singhal, co-founder of Monaeo, which was recently acquired by HR tech firm Topia. “So this could have a large impact on New York City’s tax revenues.”
At issue is the city’s Unincorporated Business Tax, a 4% tax charged at the company level to partnerships, which include hedge funds, private-equity firms, law firms, and accounting firms. In general, the city charges the tax based on where the firm’s services are performed. If the partners of a firm were all working in the Hamptons or Connecticut since March, they could seek to exclude the portion of the firm’s income earned outside the city from their taxes.
New York City has estimated that it will see a 17% decline — or about $300 million — in UBT collections this year. But Monaeo said its clients alone could end up saving more than $15 million this year on the UBT. Accountants to the wealthy say they expect the revenue decline could be far larger than the city expects.
“I think the loss is going to easily be twice what the city is expecting,” said Mark Klein, chairman of Hodgson Russ, a tax advisory firm.
The UBT loophole does not apply to personal income tax. Employees and executives who commuted to New York City before the Covid-19 crisis, and have been working from home since March won’t be able to avoid the city’s personal income tax even if they have been working from outside the city. New York’s “convenience of employer” rule allows the city to claim income tax even if a worker telecommutes.
Still, Singhal said that in addition to the UBT, many hedge fund and finance executives in New York City have started the process of changing their tax residency to the suburbs or even Florida. While the process of changing tax residency from New York City can take over a year, many have started using the Monaeo app to begin making their case that they have moved out of New York City for good.
“You can’t say you moved out of the city and keep your apartment and just move back in a year,” Klein said. “You really have to move. And the state looks at everything closely.”
Using the app doesn’t guarantee a successful audit, but Singhal said that so far, all of the company’s clients have had successful audits.
“It’s not a magic bullet,” Singhal said of the app. “But it strengthens their case. And as governments get more aggressive with audits, everything helps.”
Author: Robert Frank
5 things to know before the stock market opens Wednesday
Goldman Sachs reported quarterly numbers for the previous quarter that easily exceeded analyst expectations, sending the bank’s stock up more than 4%. The bank reported earnings per share of $6.26 per share on revenue of $13.3 billion. Analysts polled by Refinitiv expected a profit of $3.78 per share on revenue of $9.75 billion. Goldman’s global markets trading revenues surged 93% from the year-earlier period as equities trading had its best quarter in 11 years.
David Solomon, chief executive officer of Goldman Sachs & Co., listens during the Milken Institute Global Conference in Beverly Hills, California, U.S., on Monday, April 29, 2019.
Kyle Grillot | Bloomberg | Getty Images
Apple shares popped 2% after the European Union’s general court ruled in favor of the tech giant in a landmark case against the European Commission over Irish taxes. The court said the commission failed to prove the Irish government had given Apple a tax advantage, and thus the company shouldn’t have to pay the $15 billion in taxes being disputed.
Apple CEO Tim Cook delivers the keynote address during the 2020 Apple Worldwide Developers Conference (WWDC) at Steve Jobs Theater in Cupertino, California, June 22, 2020.
Brooks Kraft | Apple, Inc. | via Reuters
President Donald Trump has signed legislation to hit China with sanctions as Beijing interferes with Hong Kong’s autonomy. The law would sanction Chinese officials and companies that helped back a security law that suppresses dissent in Hong Kong. Trump also said Tuesday he signed an executive order ending preferential treatment for Hong Kong. “Hong Kong will now be treated the same as mainland China,” Trump said.
U.S. President Donald Trump speaks during a news conference in the Rose Garden at the White House in Washington, July 14, 2020.
Jonathan Ernst | Reuters
Wednesday marked the deadline for people in the U.S. to file their 2019 tax returns, which had been postponed from April 15 due to the coronavirus pandemic. The extension from the traditional deadline was meant to alleviate some of the financial pressures put on households by the pandemic.
A pamphlet about the new tax laws is displayed at Liberty Tax Service tax in Oakland, California.
Justin Sullivan | Getty Images
Author: Fred Imbert