Editorial StaffStocks lower ahead of inflation data; searing China factory gate inflation adds to concerns for faster CPI print; Coinbase slides amid crypto trading slump; Rivian looks for $76 billion valuation after IPO pricing and Poshmark shares plunge as Apple privacy changes hit online clothing reseller.
1. — Stocks Futures Track Inflation Concerns
U.S. equity futures edged lower Wednesday, while global stocks hovered near all-time highs, as investors braced for a key reading on domestic inflation that could have ripple effect for central bank policy makers around the world.
Stocks snapped their record winning streak of eight consecutive all-time highs yesterday amid a modest retreat from risk markets fueled by a faster-than-expected reading for producer price inflation and a slump in investor demand for the Treasury’s $39 billion 10-year note auction.
Overnight data from China showing factory gate inflation surging 13.5% from last year, to the fastest pace in nearly three decades, only added to concerns that supply chain disruptions, record high energy prices and loose central bank policies will stoke consumer price pressures well into next year.
Futures contracts tied to the Dow Jones Industrial Average are indicating a 60 point opening dip while those linked to the S&P 500 are priced for an 8.5 point move to the downside.
Futures tied to the tech-focused Nasdaq Composite are indicating a 35 point pullback crept higher, to 1.478%, in overnight trading.
2. — October Inflation Data In Focus
October inflation data could show core consumer prices rising nearly 5% from last year, according to some economists’ forecasts, as domestic and international price pressure continue to feed into U.S. consumer prices.
The Bureau of Labor Statistics will publish both its core and headline readings for U.S. inflation at 8:30 am Eastern time, with the Street looking for a month-on-month increase of 0.6% and an annualized inflation rate of 5.8%, a reading that would be the highest in fifteen years.
Bond investors shunned a sale of $39 billion in 10-year Treasury notes yesterday as inflation concerns clouded bond markets around the world and central banks repeated their pushback against faster policy tightening amid an insistence that price pressure will ease — along with supply chain bottlenecks — early next year.
3. — Coinbase Slides on Trading Revenue Slump
Coinbase Global (COIN) shares slumped lower in pre-market trading after the cryptocurrency brokerage posted a sharp decline in third quarter trading volumes that clouded better-than-expected earnings.
Coinbase said profits for the three months ending in September came in at $1.62 per share, 5 cents ahead of forecasts, but noted that trading volumes fell nearly 30% from the previous quarter, to $327 billion, amid tepid price volatility in digital currency markets, leading to weaker-than-expected revenues of $1.31 billion.
“Despite a sequential decline in trading volume, we saw a 41% sequential increase in subscription and services revenue, with broad based momentum in both staking and custody,” said Canaccord Genuity analyst Joseph Vafi. “We are seeing an increase in user engagement beyond just trading as 28% of retail (monthly transaction users) engaged with at least other product in addition to trading.”
Coinbase shares were marked 11.1% lower in pre-market trading to indicate an opening bell price of $317.75 each.
4. — Rivian Prices IPO At $78, Seeks $76 Billion Market Valuation
Rivian, the electric vehicle maker backed by online retail giant Amazon (AMZN) – Get Amazon.com, Inc. Report, is looking to raise nearly $12 billion from its upcoming IPO, making it one of the biggest listings in U.S. market history.
Rivian priced its upcoming Nasdaq listing at $78 per share late Tuesday, with plans to sell 153 million shares as the Irvine, California-based group looks to take on Tesla (TSLA) – Get Tesla Inc Report in the electrified vehicle market.
Last night’s pricing values Rivian at around $76.4 billion, and will raise $11.9 billion in fresh capital. Amazon, which has already ordered 100,00 of its new electric delivery vans, owns a 20% stake in the group.
The stock will debut on the Nasdaq later today under the ticker symbol RIVN.
5. — Poshmark Plunges as Apple Privacy Changes Hit Platform
Poshmark (POSH) – Get Poshmark Report shares plunged lower in pre-market trading after the online resale platform posted a wider-than-expected third quarter loss and warned the recent privacy changes from Apple (AAPL) – Get Apple Inc. (AAPL) Report would trigger higher marketing spend.
Poshmark said its loss for the three months ending in September was pegged at 9 cents per share, 2 cents wider than the Street consensus forecast, as revenues came in 3 million light of analysts’ forecasts at $82.7 million.
“For the remainder of the year, we expect marketing as a percentage of revenues to be in the high 40s due to higher cost in digital advertising as a result of Apple privacy changes,” interim CFO Kapil Agrawal told investors on a conference call late Tuesday. “We expect that uncertainty due to COVID and its effect on reopening time lines across international markets launched in 2021 will result in a slower ramp-up than what we had initially expected for next year, impacting growth rates.”
Poshmark shares were marked 29.3% lower in pre-market trading to indicate an opening bell price of $17.34 each. Shares in the group traded at around $97.50 when they listed on the Nasdaq in early January.
Source: The Street
