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Disney delights, consumer earnings, jobless claims - what's moving markets

By Geoffrey Smith

© Reuters.


Investing.com -- Walt Disney stock jumps as the company's streaming loss narrows and CEO Bob Iger flags a dividend restart. Pepsi, Unilever, and BAT, all forecast weak outlooks for 2023 after forcing consumers to wear some chunky price increases last year. Stocks are set to open higher ahead of the weekly jobless claims numbers, and oil rises on the back of another report showing how much the market will tighten this year. Here's what you need to know in financial markets on Thursday, 9th February.

1. Disney delights

Walt Disney (NYSE:DIS) stock soared in premarket after the company narrowed its loss on streaming and announced 7,000 job cuts to shore up profitability.

Chief executive Bog Iger, presenting his first quarterly results since replacing Bob Chapek, also said he will ask the board to reinstate the company's dividend by the end of the year, addressing one of activist investor Nelson Peltz's key points.

Disney posted first quarter earnings that were 25% above market forecasts, thanks to the strength of its theme parks division, while Disney+, ESPN, and Hulu all eked out marginal gains in subscribers in the quarter, but the company saw average revenue per user drop as customers opted for better-value multi-product bundles. Worldwide subscriber numbers dropped after Hotstar's loss of broadcast rights to Indian Premier League cricket.

2. Consumer sector posts weak outlook after hefty price rises

It's a day when the consumer sector dominates the earnings calendar, with updates due from PepsiCo (NASDAQ:PEP), Philip Morris (NYSE:PM), Kellogg (NYSE:K), Unilever (NYSE:UL) and British American Tobacco (NYSE:BTI).

Pepsi and Unilever both forecast demand would weaken this year, in response to some huge price increases for their range of food and drink products.

Pepsi's average prices jumped 16% for the fourth quarter, while organic volume slipped 2%. Unilever, the owner of Dove soap and Ben & Jerry's ice cream said its prices were up 13.3%, while sales volumes declined, leaving 9% rise in net sales.

BAT (LON:BATS), meanwhile, hit a 12-month low in London after suspending buybacks as it grapples with rising costs for servicing over $40 billion of debt. Mattel (NASDAQ:MAT), another consumer-facing company, also slumped in premarket after a weak late update.

3. Stocks set to open higher; jobless claims due, earnings torrent continues

U.S. stock markets are set to open higher, supported by Disney's earnings, but still appear to be struggling for direction amid a mixed earnings season dominated by gloomy full-year outlooks.

By 06:30 ET, Dow Jones futures were up 215 points or 0.6%, while S&P 500 futures were up 0.8%, and Nasdaq 100 futures were up 1.1%.

Other companies due to report earnings in the course of the day include AbbVie (NYSE:ABBV), PayPal (NASDAQ:PYPL), Apollo Global (NYSE:APO), and Warner Music (NASDAQ:WMG). BorgWarner (NYSE:BWA) has already joined O'Reilly Automotive (NASDAQ:ORLY) in posting surprisingly strong numbers from the auto components sector.

The data calendar is light, with only U.S. jobless claims of note.

4. German CPI may cause Eurozone number to be revised higher

The mystery over Germany's January inflation deepened, with Destatis publishing figures that suggest the Eurozone's number for last month will have to be revised upward.

Headline CPI fell to 9.2%, using the EU's methodology, but rose to 8.7% on the national standard, after a 1% rise in prices in the month. However, there was no hint as to how the agency had accounted for rebates on gas and electricity bills, which are supposed to be issued retroactively in March, backdated to the start of the year.

The numbers at least gave no clear signal that would cause the ECB to deviate from the guidance it gave at last week's press conference (which was, in any case, dismissed as a bluff by Eurozone stock and bond markets). ECB vice president Luis de Guindos may shed more light in a speech later.

5. Oil hits one-week high, shrugs off U.S. stock build

Crude oil prices edged to new one-week highs, shrugging off official U.S. data which showed that crude stocks actually rose last week. That's seven straight weeks of rising inventories, the longest such streak since 2020.

By 06:40 ET, U.S. crude futures were up 0.1% at $78.56 a barrel, while Brent crude was up 0.2% at $85.22 a barrel.

Earlier, Saudi Arabian think tank KAPSARC said it expected Chinese demand to rise by an average of 550,000 barrels a day, while some 820,000 barrels a day of Russian output will be lost to western sanctions and price cap measures.

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