US stock futures wavered early on Friday as the world awaited an update on US-Iran peace talks.
Futures attached to the Dow Jones Industrial Average (YM=F) rose 0.3% while the benchmark S&P 500 (ES=F) and the tech-heavy Nasdaq 100 (NQ=F) rose 0.1%. The S&P 500 is vying for the index’s longest weekly winning streak since 2023.
Markets started the week on a down note, with concerns of persistent inflation stoking worries about Federal Reserve rate hikes. Since reports of movement on US-Iran talks picked up on Wednesday, however, investors have had reason to believe a primary source of rising prices could be resolved soon.
Stocks rebounded on Thursday after Secretary of State Marco Rubio and Iranian media signaled progress on negotiations between the US and Iran for a peace deal. However, clear sticking points remain.
On Friday, the University of Michigan’s latest readings on consumer sentiment and inflation expectations will offer fresh insight into how much price pressures are rising as the war drags on.
Earnings season also continues to wrap up, with major government contractor Booz Allen Hamilton (BAH) reporting an earnings beat but a revenue shortfall versus estimates.
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Campbell Soup stock hasn’t been this low in over 30 years
Yahoo Finance’s Brian Sozzi reports:
Shares of the maker of Rao’s pasta sauce, Snyder’s pretzels, Goldfish crackers, and Campbell’s chicken noodle soup are now hovering at 30-year lows. The stock is down about 19% since the company reported earnings in March.
Only General Mills (GIS), Conagra (CAG), and McCormick (MKC) have performed worse since The Campbell Company’s last earnings report: They have declined 21%, 24%, and 26%, respectively.
Campbell’s had a dreadful quarter. Net sales dropped 5% year over year to $2.56 billion, under estimates of $2.64 billion. Consumers pulled back on discretionary snack purchases. The core Meals & Beverages segment grappled with lower demand for traditional condensed soups.
Booz Allen stock pops after earnings
Booz Allen Hamilton (BAH) stock jumped 5% after adjusted earnings of $1.78 per share exceeded Wall Street’s expectations for earnings of $1.32 per share.
However, the contractor’s revenue of $2.78 billion fell short of Street forecasts.
Investors were looking for Booz Allen stock to bottom out after it lost 9% year to date, as concerns grew about its relationship with the Trump administration. In January, the Treasury Department canceled all 31 separate contracts with Booz Allen, amounting to $21 million, citing a failure “to implement adequate safeguards to protect sensitive data.”
In late April, Treasury Secretary Scott Bessent told Senate lawmakers that Treasury officials “no longer have confidence” in the company.
IBM just scored a $26 billion quantum windfall — and the stock’s rally isn’t over
IBM’s (IBM) 11% stock rally on Thursday, following a landmark announcement by the US Commerce Department to award $2 billion in grants to fund domestic quantum computing firms, created a windfall for the company. And the stock rose another 3% on Friday morning.
The move added about $26 billion to IBM’s market cap, bringing it to $237.8 billion, Yahoo Finance’s Brian Sozzi reported. He writes:
IBM secured the single-largest allocation in the program — a $1 billion government grant — which the tech giant will match with $1 billion of its own capital to construct “Anderon” in Albany, New York. It’s being billed as America’s first pure-play, dedicated 300mm quantum chip manufacturing foundry.
The hype around this deal reflects a transition in IBM’s quantum roadmap from a long-term research and development project into a critical national-level manufacturing platform. In turn, the company is viewed as the primary infrastructure and foundry provider for its own hardware and that of its competitors.
Most analysts on Wall Street have come out in favor of the news.
Estée Lauder stock jumps after Puig merger talks fail
Estée Lauder (EL) stock jumped 10% after late-stage merger talks with Spanish beauty group Puig (B1B.F) ended. Puig’s stock fell 13%.
Bloomberg reported that Charlotte Tilbury’s compensation demands for the deal were a sticking point in the negotiations. Charlotte Tilbury sold her makeup brand to Puig in 2020.
Estée Lauder, which owns cosmetics brands including Clinique and Mac, said the company remains focused on executing its turnaround strategy.
“Today, we are reiterating our confidence in the power of our incredible brands, our talented teams, and our strength as a standalone company,” CEO Stéphane de La Faverie said. “We are more optimistic than ever about our ability to unlock significant long-term value through Beauty Reimagined, and we remain focused on accelerating that progress.
Oil pushes higher as Iran talks on uranium puts pressure on global stability
Bloomberg reports:
Oil rose after three days of declines, as statements by Iran on uranium and the Strait of Hormuz pared earlier optimism over progress in the negotiations with the US.
Brent (BZ=F) climbed toward $105 a barrel, but is still down more than 4% this week. West Texas Intermediate (CL=F) was near $98. Iran said the latest proposal from the US partly bridged the gap between the warring sides, but comments from the Islamic Republic’s Supreme Leader about keeping Tehran’s uranium stockpile and a dispute over tolls in the Strait of Hormuz clouded the outlook for a breakthrough.
The conflicting statements on key issues left it unclear if the two sides were any closer to a deal after renewed threats of escalation in recent days, buffeting oil prices as traders try to gauge when energy flows through the strait will fully resume. The war and the curtailment in supplies has seen global stockpiles of crude oil and products being drawn down at a record pace, according to Goldman Sachs Group Inc.