Pre-Market Brief: Stocks Retreat as Ukraine War Continues and ECB Slows Asset Purchases

Morning Markets

March S&P 500 futures this morning are down by -0.98%.  U.S. stocks indexes this morning are moving lower, weighed down by a -2.75% plunge in the Euro Stoxx 50.  European stocks are falling on signs the Russian attack on Ukraine will continue. Stock losses accelerated after the ECB announced a faster winding down of its asset-purchase program.  U.S. stock indexes maintained moderate losses after this morning’s U.S. economic data showed weekly jobless claims rose more than expected, and consumer prices accelerated for a sixth month at the fastest pace in 40 years. 

U.S. weekly initial unemployment claims rose +11,000 to 227,000, showing a weaker labor market than expectations of 217,000.

U.S. Feb CPI rose +7.9% y/y, right on expectations and the largest increase in 40 years.

The Euro Stoxx 50 index today is down sharply by -2.75%, giving back nearly half of Wednesday’s +7.4% surge.  European stocks retreated today after negotiations between Russia and Ukraine made little progress in halting the war.  Ukrainian Foreign Minister Kuleba said Russian Foreign Minister Lavrov conveyed that Russia seeks Ukraine’s surrender and will continue its attack until its demands are met.  Stocks extended their decline after the ECB unexpectedly decided to accelerate the winding down of its asset purchase program, citing price pressures from the war in Ukraine.

The ECB today said it would end its Pandemic Purchase Program (PEPP) in March and unexpectedly said it will slow its asset purchase program (APP) to 30 billion euros a month in May and then to 20 billion euros in June and may end the APP program in Q3.  The ECB also said that any changes in borrowing costs will take place “some time after” the end of net bond purchases and will be “gradual.”

The ECB cut its Eurozone 2022 GDP estimate to 3.7% from 4.2% and raised its Eurozone 2022 inflation forecast to 5.1% from 3.2%.

Goldman Sachs predicts Eurozone Q2 GDP will contract due to the war in Ukraine.  Goldman cut its Eurozone 2022 GDP estimate to 2.5% from a previous estimate of 3.9%.

Asian markets today closed higher.  China’s Shanghai Composite closed up +1.22%, and Japan’s Nikkei Stock Index closed up sharply by +3.94%.  Asian stock markets rallied today on the heels of Wednesday’s rally in U.S. and European markets.  Also, inflation concerns eased after crude prices tumbled -12% on Wednesday.  A bearish factor for Japanese stocks was a surge in producer prices after today’s data showed Japan Feb PPI rose +9.3% y/y, stronger than expectations of +8.6% y/y and the fastest pace of increase in 41 years. 

Pre-Market U.S. Stock Movers

Cisco Systems (CSCO) fell -2% in pre-market trading after Wells Fargo Securities downgraded the stock to equal-weight from overweight.

Cryptocurrency-exposed stocks are falling in pre-market trading, with the price of Bitcoin down more than -6%.  Marathon Digital (MARA) and Bit Digital (BTBT) are down more than -6%, Microstrategy (MSTR) and Riot Blockchain (RIOT) are down more than -5% and Coinbase Global (COIN) is down more than -3%. 

Fossil (FOSL) tumbled -12% in pre-market trading after it reported Q4 adjusted Ebitda of $7.5 million, down -85% y/y.

Coupang (CPNG) dropped more than -7% in pre-market trading after a block of 50 million shares of the company’s stock is said to be launched via Goldman Sachs.

Amazon.com (AMZN) climbed +6% in pre-market trading after the company announced a 20-for-1 stock split and a $10 billion stock buyback. 

Crowdstrike Holdings (CRWD) jumped +12% in pre-market trading after it reported Q4 revenue of $431.0 million, better than the consensus of $410.5 million, and forecast 2023 revenue of $2.13 billion to $2.16 billion, stronger than the consensus of $2.01 billion.

Marqeta (MQ) surged +22% in pre-market trading after it reported Q4 revenue of $155.4 million, stronger than the consensus of $137.8 million.

Today’s U.S. Earnings Reports (3/10/2022)

Acutus Medical Inc (AFIB), Aemetis Inc (AMTX), AFC Gamma Inc (AFCG), Alto Ingredients Inc (ALTO), American Outdoor Brands Inc (AOUT), Amphastar Pharmaceuticals Inc (AMPH), Artesian Resources Corp (ARTNA), BioDelivery Sciences Internati (BDSI), Bioventus Inc (BVS), Bioxcel Therapeutics Inc (BTAI), Blink Charging Co (BLNK), Cadre Holdings Inc (CDRE), Centrus Energy Corp (LEU), Citizens Inc/TX (CIA), Clarivate PLC (CLVT), Comtech Telecommunications Cor (CMTL), Concrete Pumping Holdings Inc (BBCP), Custom Truck One Source Inc (CTOS), Design Therapeutics Inc (DSGN), DocuSign Inc (DOCU), Duckhorn Portfolio Inc/The (NAPA), Duluth Holdings Inc (DLTH), Earthstone Energy Inc (ESTE), Eiger BioPharmaceuticals Inc (EIGR), El Pollo Loco Holdings Inc (LOCO), Erasca Inc (ERAS), Eros STX Global Corp (ESGC), Eros STX Global Corp (ESGC), Finch Therapeutics Group Inc (FNCH), FuelCell Energy Inc (FCEL), Genesco Inc (GCO), Geron Corp (GERN), Harpoon Therapeutics Inc (HARP), Kronos Worldwide Inc (KRO), Landsea Homes Corp (LSEA), Latham Group Inc (SWIM), Lazydays Holdings Inc (LAZY), Legalzoom.com Inc (LZ), Life Time Group Holdings Inc (LTH), LifeStance Health Group Inc (LFST), Limoneira Co (LMNR), Lineage Cell Therapeutics Inc (LCTX), MeridianLink Inc (MLNK), Mission Produce Inc (AVO), Myers Industries Inc (MYE), NeuroPace Inc (NPCE), NI Holdings Inc (NODK), NL Industries Inc (NL), NN Inc (NNBR), Oncocyte Corp (OCX), Oncternal Therapeutics Inc (ONCT), Oracle Corp (ORCL), PlayAGS Inc (AGS), Portillo's Inc (PTLO), Postal Realty Trust Inc (PSTL), Red Robin Gourmet Burgers Inc (RRGB), Rekor Systems Inc (REKR), Reneo Pharmaceuticals Inc (RPHM), Rivian Automotive Inc (RIVN), Selecta Biosciences Inc (SELB), Seritage Growth Properties (SRG), Shoals Technologies Group Inc (SHLS), Smith Micro Software Inc (SMSI), StarTek Inc (SRT), StoneCo Ltd (STNE), Target Hospitality Corp (TH), Tattooed Chef Inc (TTCF), TherapeuticsMD Inc (TXMD), Thryv Holdings Inc (THRY), Tilly's Inc (TLYS), Ulta Beauty Inc (ULTA), UroGen Pharma Ltd (URGN), Viant Technology Inc (DSP), Viracta Therapeutics Inc (VIRX), Vita Coco Co Inc/The (COCO), Vital Farms Inc (VITL), Willdan Group Inc (WLDN), Zumiez Inc (ZUMZ).