Futures rise on Walmart forecast, debt ceiling deal optimism
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[May 18, 2023] By
Shreyashi Sanyal and Shristi Achar A
(Reuters) - U.S. stock index futures rose on Thursday after retail
behemoth Walmart's strong annual forecast eased worries about a slowdown
in consumer spending amid optimism over a potential deal to avoid a
catastrophic debt default.
Shares of Walmart Inc rose 1.4% in premarket trading after the retailer
raised its annual sales and profit targets, befitting from
inflation-wary consumers trading down to cheaper groceries.
Results earlier this week from retailers such as Target Corp, Home Depot
Inc and TJX Companies Inc have also shown consumers turning away from
non-essentials such as electronics and home goods in the face of high
inflation.
Wall Street's main indexes ended the previous session higher after
President Joe Biden and top U.S. congressional Republican Kevin McCarthy
reiterated their determination to strike a deal soon to raise the $31.4
trillion federal debt ceiling, agreeing to talk as soon as Sunday.
"We didn't actually get much in the way of concrete developments, but
negotiations are continuing and the mood was lifted by the fact that all
the major players reiterated they want to avoid a default, which helped
reassure market participants," strategists at Deutsche Bank wrote in a
note.
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At 7:15 a.m. ET, Dow e-minis were up 53 points, or 0.16%, S&P 500
e-minis were up 10.5 points, or 0.25%, and Nasdaq 100 e-minis were up
32.25 points, or 0.24%.
Investors now await weekly data on jobless claims, which are expected to
fall to 254,000 claims in the week ended May 13 from 264,000 in the
previous week. The Philadelphia Fed's business index is also scheduled
for release, with both data sets due at 8:30 a.m. ET.
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Traders work on the floor of the New
York Stock Exchange (NYSE) in New York City, U.S., May 4, 2023.
REUTERS/Brendan McDermid
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Shares of U.S. regional lenders extended gains, led by a 7.7% rise
in PacWest Bancorp as markets bet on the worst of the bank rout
being over.
Western Alliance Bancorp and Zions Bancorporation NA added 4.0% and
1.3% respectively.
Dow Jones Industrial Average constituent Cisco Systems Inc's shares
fell 4.2% after it said a large backlog of products due to supply
chain constraints has hit demand for new orders from customers.
Bath & Body Works Inc gained 9.7% after the beauty and skincare firm
raised its annual profit forecast.
Take-Two Interactive Software Inc jumped 13.6% as it beat analyst
estimates for quarterly adjusted sales on strong demand from legacy
titles "NBA 2K" and "Grand Theft Auto".
Chipmaker Micron Technology Inc's shares gained 2.0% as it plans to
invest up to 500 billion yen ($3.70 billion) in Japan for new chips
over the next few years.
Japan's Prime Minister Fumio Kishida said he welcomed and expected
more investment from global chipmakers in the country.
(Reporting by Shreyashi Sanyal and Shristi Achar A in Bengaluru;
Editing by Maju Samuel)
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