Stocks Extend Losses as Oil Rises, Bitcoin Retreats

Midday Movers

21 minutes ago

Apple (AAPL) shares fell for a second straight day after Barclays raised concerns about iPhone sales and downgraded the stock.

Shares of Charles Schwab (SCHW) also sank after a downgrade from Goldman Sachs, which said that lower interest rates could hurt Schwab’s profits.

Walgreens Boots Alliance (WBA) shares slumped ahead of its financial report tomorrow, as analysts expect a drop in earnings because of a big decline in COVID-19 vaccines and treatments.

Shares of Marathon Petroleum (MPC) and other energy providers gained as oil prices spiked after a disruption in production at a key oilfield in Libya.

Northrop Grumman (NOC) shares advanced as the U.S. Air Force awarded it a $9.2 million contract to improve the range of air-to-air missiles.

Shares of AutoZone (AZO) rose with Phil Daniele officially taking over as CEO from longtime company head Bill Rhodes.

–Bill McColl

Oil Jumps as Fear of Regional Middle East Conflict Builds

1 hr 9 min ago

Oil futures surged Wednesday morning as fighting in the Red Sea and a deadly attack at the gravesite of an Iranian military commander fanned fears of a larger conflict engulfing the oil-rich region. 

More than 100 people were reported dead Wednesday after two bombs detonated near the grave of Qassem Soleimani in the city of Kerman on the fourth anniversary of his killing by a U.S. drone strike. The bombing comes a day after Hamas accused Israel of ordering an air strike that killed a senior official in Lebanon. 

This week’s violence has fanned fears that fighting between Israel and Hamas will spill over into neighboring countries like Lebanon and draw in Iran, which supports Hamas and allies like Hezbollah. Iran-backed Houthi rebels in Yemen have for weeks been targeting commercial ships transiting the Red Sea, leading many oil tankers and shipping companies to redirect traffic around Africa. In response, the U.S. and Iran have both sent naval vessels to the waterway. 

West Texas Intermediate futures jumped more than 3% Wednesday, rising from below $70 a barrel to nearly $73 by midday. Brent crude, the European benchmark, rose from $75 to about $78 a barrel. 

Ford Falls After Recalling Over 112,000 F-150 Pickups For Roll Away Risk

1 hr 59 min ago

Ford (F) shares fell nearly 4% Wednesday morning after the automaker recalled 112,965 F-150 pickups due to roll away risks.

The automaker said that the recall, which potentially affects 112,965 pickup trucks, concerns a rear axle hub bolt that “may fatigue and break” which could “result in damage to the axle hub splines.”

The company reported that a “remedy is currently under development” and that “owners will be instructed to take their vehicle to a dealer for an interim repair if they experience symptoms related to rear axle bolt breakage, such as a clicking or rattling noise.”

–Naomi Buchanan

Walt Disney Reaches Agreement with ValueAct in Bid to Fend off Peltz

2 hr 33 min ago

Shares of Walt Disney Co. (DIS) rose early Wednesday after the company said it was teaming up with hedge fund ValueAct to fend off a proxy fight with activist investor Nelson Peltz. 

The companies said in a joint statement Wednesday that they had reached an agreement allowing Disney to share otherwise confidential information with ValueAct and consult the investment firm on strategic decisions. As part of the pact, ValueAct has agreed to support Disney’s slate of nominees to its Board of Directors.

“ValueAct Capital has a track record of collaboration and cooperation with the companies it invests in, and its Co-CEO Mason Morfit has been very constructive in the conversations we’ve had over the past year. We welcome their input as long-term shareholders,” said Disney CEO Bob Iger in a statement.

Disney is facing a proxy fight with activist investor Nelson Peltz, who through his firm Trian Fund Management nominated himself and former Disney CFO James Result to the company’s board in December. It is Peltz’s second proxy battle with Disney in two years. He attempted to join the board in 2022 before dropping his bid after the company announced sweeping cost-cutting measures. 

Stocks Making the Biggest Moves Premarket

3 hr 39 min ago

Gains:

• Pure Storage Inc. (PSTG): Shares of the storage company rose about 6% after S&P Global said it would join the S&P 400 MidCap Index effective Jan. 5, replacing Patterson Companies Inc. (PDCO).
• Novartis AG (NVS): Shares of the pharmaceutical company rose 2% a day after it announced a gene therapy deal with biotech Voyager Therapeutics that will see it pay $100 million upfront, plus an additional $1.1 billion if certain regulatory and sales milestones are met.
• Verizon Communications Inc. (VZ): Shares rose nearly 2% after KeyBanc upgraded the telecom provider to “overweight,” citing its relative strength compared to AT&T, one of its only real competitors. 

Losses:

• Coinbase Global (COIN): Shares of the cryptocurrency exchange fell more than 6%, adding to yesterday’s losses, as the price of Bitcoin tumbled ahead of the SEC’s decision, expected this week, on a spot ETF. 
• Royal Caribbean Cruises Ltd. (RCL): Shares of the cruise operator fell nearly 2% as investors continued to sell off 2023’s biggest winners; Carnival was the third-best performing stock in the S&P 500 last year. 
• Nvidia (NVDA): The chipmaker’s shares fell about 1%, extending yesterday’s losses alongside other chip stocks Arm Plc (ARM), down 2% premarket, and Advanced Micro Devices (AMD), down more than 1%. 

Stock Futures Lower Ahead of Jobs Data, Fed Minutes

4 hr 30 min ago

Futures contracts connected to the Dow Jones Industrial Average were down 0.3% in premarket trading Wednesday.

S&P 500 futures fell 0.4%.

Nasdaq 100 futures were off 0.7%.