ECONOMIC SILUET: 5 things to know before the stock market opens Friday

Jumat, 28 April 2023

5 things to know before the stock market opens Friday

FRI, APR 28, 2023

MORNING SQUAWK

1. Here comes the weekend

After Thursday's big rally – the Dow and the S&P 500 had their best days since January – stocks look like they might end the week with a whimper. Friday morning futures indicated that investors weren't too happy with the latest batch of tech earnings. And overall, while companies are doing well against Wall Street's expectations this earnings period, they're not exactly wowing investors, according to some market watchers. There are more quarterly results ahead next week, too, with big names such as Ford, Starbucks and Warner Bros. Discovery on deck. Follow live market updates.

2. Cloudy with a chance of disappointment

For a minute there Thursday, Wall Street loved Amazon's earnings report, sending the tech behemoth's stock up about 10% in after hours trading. Revenue topped expectations, and its AWS cloud business posted a 16% increase in sales. Then things turned murkier on the company's earnings call, as executives offered a somewhat sour outlook on cloud revenue, noting that clients have continued to pare back their spending into the current quarter. "As expected, customers continue to evaluate ways to optimize their cloud spending in response to these tough economic conditions in the first quarter," said Chief Financial Officer Brian Olsavsky. Shares went negative after that.

3. Intel wins despite a loss

Shares of Intel were doing fine in extended trading, on the other hand, even after the chip maker reported the biggest quarterly loss in its history. The results cleared a very low bar, however. Wall Street had expected a dramatic decline in revenue. Indeed, Intel did report just that, but its top line of $11.7 billion still beat analysts' outlook. Its second quarter revenue outlook, too, just barely cleared estimates. It's fair to say the company is stuck in a rut as PC demand tumbles, even though it's stock is up more than 12% so far this year through Thursday's close.

4. Beyond available

Hundreds of Bed Bath & Beyond locations, including Buy Buy Baby stores, are about to close, as the company liquidates during its bankruptcy process. But don't expect them to stay vacant for long. Even with inflation and other uncertainties in the economy, retail space in strip malls and shopping centers is a hot commodity. Those cavernous Bed Bath locations could become mega gyms, or dollar stores, or even be split among multiple businesses. "In the past, I may have been a bit more concerned if we were to go through something like this, but I'm just not," one retail industry expert told CNBC's Melissa Repko.

5. Exxon turns a record profit

Sagging energy prices be darned. Exxon had a blockbuster first quarter. Its profit for the period more than doubled compared to the year-ago period. Indeed, the oil giant's $11.43 billion in earnings for the first three months of 2023 is a first-quarter record for the company. Increased production helped beef up the bottom line, according to Chief Financial Officer Kathryn Mikells. "We delivered a first-quarter record despite the fact that energy prices and refining margins are softening a bit," she told Reuters. Rival Chevron also reported higher profits that topped Wall Street's expectations, even as profit for its oil and gas production division fell by a fourth compared to the same period a year ago.

— CNBC's Mike Calia wrote this newsletter. Sarah Min, Annie Palmer, Kif Leswing, Melissa Repko and Reuters contributed.

— Follow Squawk Pod for the best conversations and analysis from Squawk Box in a curated, daily podcast.