Futures for the major averages were pointing to losses in early trading, which would have extended the declines seen in regular trading yesterday that was attributed largely to the gloomy outlook from Fed Chair Jerome Powell. The CEO of Novartis (NVS) has said a vaccine may not be available until late 2021, which is adding some weight as well. However, in early afternoon trading, stocks have come off their lows and turned mixed, witht the Dow and S&P now in the green and the Nasdaq lagging but nearly positive as well.
ECONOMIC EVENTS: In U.S. data, initial jobless claims fell 195,000 to a higher than expected 2.98M in the week ended May 9, leaving the four-week moving average at about 3.62M. The trade price indexes revealed big April declines that accompanied this week's huge drops for CPI and PPI last month. Import prices fell 2.6%, while export prices fell 3.3%. The export price drop is the biggest on record going back to 1989, while the import price slide is the steepest since the start of 2015.
TOP NEWS: Shares of Wells Fargo (WFC) and Goldman Sachs (GS) were in the spotlight after Fox Business Senior Correspondent Charles Gasparino said via Twitter last night that speculation is growing about a possible merger between the two banks. In a research note to investors, JPMorgan analyst Vivek Juneja argued that the media speculation of a possible merger is "unfounded," noting that any bank acquisition by Wells Fargo is banned by law as the company already exceeds the 10% deposit market share limit.
Cisco (CSCO) shares are nearly 4% higher after the network gear giant reported fiscal Q3 results that beat reduced expectations. JPMorgan analyst Samik Chatterjee and several Wall Street peers called the results and guidance for revenue declines in Q4 better than feared, but Needham analyst Alex Henderson was among those who argued that recovery will be a slow process for Cisco.
Meanwhile, shares of Norwegian Cruise Line (NCLH) are up 3% after the cruise ship operator reported steeper than expected losses in the first quarter and said it believes it can "weather an unlikely scenario of over 18 months of suspended voyages."
Additionally, shares of SmileDirectClub (SDC) have slid 6% after the company posted Q1 results last night that JPMorgan analyst Robbie Marcus described as "decent." Less bullish, BofA analyst Michael Ryskin downgraded SmileDirectClub two notches, to Underperform from Buy, with a price target of $7, down from $10, following the company's earnings report.
After abstracts were posted for the upcoming virtual meeting of the American Society of Clinical Oncologists, or ASCO, Wall Street analysts weighed in with some of the companies that they viewed as "winners" on the heels of the first looks at the clinical data that will be discussed at the meeting of cancer doctors. Analyst commentary, and the moves in the stocks, points to Allogene (ALLO) being among the winners while the reactions to data from MacroGenics (MGNX) and CytomX appear to be more lukewarm.
MAJOR MOVERS: Among the noteworthy gainers was Laureate Education (LAUR), which rose 7.5% after CFO Jean-Jacquire Charhon disclosed the purchase of 101,000 shares of common stock in the company. Also higher were Wix.com (WIX) and Oceaneering (OII), which gained a respective 9% and 5% after reporting quarterly results.
Among the notable losers was CytomX Therapeutics (CTMX), which slid 32% after H.C. Wainwright analyst Robert Burns cut his price target on the stock to $12 from $16, saying that the company's abstracts at ASCO leave more questions than answers. Also lower were Virtusa (VRTU) and Stratasys (SSYS), which fell 27% and 5%, respectively, after reporting quarterly results.
INDEXES: Near 1 pm ET, the Dow was up 146.93, or 0.63%, to 23,394.90, the Nasdaq was down 12.75, or 0.14%, to 8,850.42, and the S&P 500 was up 7.10, or 0.25%, to 2,827.10.
