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5 things to know before the stock market opens Wednesday

1. Nasdaq futures jump 1.5% as Google parent Alphabet surges

Traders on the floor of the NYSE, Feb. 1, 2022.
Source: NYSE

U.S. stock futures rose Wednesday, with Google parent Alphabet’s 10.4% premarket surge on strong earnings pushing Nasdaq futures more than 1.5% higher as Wall Street looks to advance for the fourth straight session. Shares of Facebook parent Meta Platforms rose 3% in the premarket ahead of earnings out after the bell.

The late-January market rally continued into February, with the Dow Jones Industrial Average, the S&P 500 and the Nasdaq closing up roughly 0.7% each. The Nasdaq remained in correction territory heading into the new trading day.
Ahead of Friday’s monthly employment report, ADP said before-the-bell Wednesday that U.S. companies cut 301,000 jobs in January. Economists had expected growth of 200,000 new private-sector positions. December was downwardly revised to a 776,000 gain. It’s worth noting that during the Covid pandemic, the ADP numbers have not been the best indicator of the government’s jobs report.

2. Alphabet delivers strong quarter, plans a 20-for-1 stock split

American multinational technology company Google logo seen at Googleplex, the corporate headquarters complex of Google and its parent company Alphabet Inc.
Alex Tai | SOPA Images | LightRocket | Getty Images

If Alphabet’s premarket advance were to hold at the open, the stock would top November’s all-time high and go back above a $2 trillion market value. Late Tuesday, the tech giant reported better-than-expected earnings and revenue for the fourth quarter. It beat estimates in the services and cloud businesses. Alphabet announced a 20-for-1 stock split, pending shareholder approval, leading to speculation about whether the name could eventually be added to the Dow 30. It also repurchased a record $13.47 billion of stock in the quarter.

3. PayPal plunges on weak guidance; AMD surges on strong outlook

The PayPal logo displayed on a smartphone screen with a stock market graphic in the background.
Omar Marques | SOPA Images | LightRocket | Getty Images

PayPal reported disappointing fourth-quarter results after the closing bell Tuesday, and the stock got pummeled, sinking roughly 17% in the premarket. The digital payments company slightly missed estimates for fourth-quarter earnings and slightly beat on revenue. But it was the forward guidance that really crushed the stock.

The Epyc 2nd generation chip, manufactured by Advanced Micro Devices Inc. (AMD) is arranged for a photograph during a launch event in San Francisco, California, U.S., on Wednesday, Aug. 7, 2019.
David Paul Morris | Bloomberg | Getty Images

Advanced Micro Devices shares jumped 12.5% in Wednesday’s premarket, the morning after the chipmaker reported fourth-quarter earnings and revenue that beat estimates and delivered a strong full-year sales forecast. With the closing of the Xilinx acquisition on the horizon, AMD is poised to add more firepower to compete against Intel in the data center semiconductor market.

4. GM sees strong full-year earnings as chip shortage abates

A General Motors sign is seen during an event on January 25, 2022 in Lansing, Michigan. – General Motors will create 4,000 new jobs and retaining 1,000, and significantly increasing battery cell and electric truck manufacturing capacity.
Jeff Kowalsky | AFP | Getty Images

General Motors shares rose 2.3% in the premarket after the automaker said late Tuesday that it expects to generate an operating profit this year of between $13 billion and $15 billion as a semiconductor shortage that marred vehicle production and sales for most of last year shows signs of improving. GM reported a mixed fourth quarter, beating estimates on earnings but slightly missing on revenue.

5. Starbucks earnings miss on higher costs, CEO sees more inflation

A person wearing a protective mask enters a Starbucks coffee shop in San Francisco, California, U.S., on Thursday, Jan. 21, 2021.
David Paul Morris | Bloomberg | Getty Images

Starbucks shares fell nearly 3% in premarket trading following the coffee giant saying after the bell Tuesday that higher costs are weighing on profits, leading the company to miss fiscal first-quarter earnings estimates and cut its full-year profit outlook. Starbucks did beat estimates on Q1 revenue. CEO Kevin Johnson said on the company’s earnings call that he’s anticipating higher inflation for the rest of the year.

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