Dow Jones futures rose modestly Sunday evening, along with S&P 500 futures and Nasdaq futures. The stock market rally held near highs last week with a number of leaders flashing buying opportunities.
Square (SQ) announced a major acquisition and released blowout earnings, but sales below views. Li Auto reported booming July sales with Nio (NIO), Xpeng and Tesla’s other China EV rivals are in focus.
Square Takeover, Earnings
Square agreed to pay $29 billion for Afterpay, an Australian fintech specializing in buy now/pay later services. The digital payments leader also released Q2 results ahead of Thursday’s scheduled date. Square earnings per share spiked 266% to 66 cents with revenue up 266% to $4.68 billion. Analysts expected EPS of 30 cents on sales of $5.03 billion.
Square stock fell 6.3% last week to 247.26, below a 254.88 cup-with-handle buy point.
Li Auto (LI) on Sunday reported July deliveries of 8,589, up 251% vs. a year earlier. Fellow Chinese EV makers Nio, Xpeng (XPEV), and BYD Co. (BYDDF) are set to release July sales within the next few days. Tesla (TSLA) China sales for July won’t come for at least another week. Tesla has made a series of moves in China, including exports, cheaper variants and outright price cuts.
Chinese EV makers are trying to maintain rapid growth amid chip shortages and other supply-chain issues plaguing the auto industry. Meanwhile, China stocks have come under heavy pressure as Beijing has cracked down on private industry, including U.S.-listed Chinese companies, Internet and consumer-data heavy firms and more.
So far, China has not cracked down on automakers or EV makers specifically. But the risk is always there. More U.S. investors may steer clear of Chinese equities entirely, while others will be extremely wary.
China EV sales come amid signs of a slower Chinese economic recovery. China’s official manufacturing index fell 0.5 point in July to 50.4, the weakest since February 2020 and below views for 50.8. The nonmanufacturing index dipped 0.2 point to 53.3, in line with estimates.
Nio stock, Xpeng, Li Auto and BYD Co. all rallied last week back above key levels amid signs that China wanted to halt the broader sell-off in Chinese stocks. BYD stock arguably cleared an aggressive entry and is near a legitimate buy point.
Tesla stock also rebounded last week from key support, flashing an aggressive entry above a trend line.
Dow Jones Futures Today
Dow Jones futures rose 0.5% vs. fair value. S&P 500 futures advanced 0.6% and Nasdaq 100 futures climbed 0.5%.
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A national eviction ban imposed during the pandemic expired Saturday. That could spur foreclosures and evictions, as well as reduce consumer spending outside of housing. It could…
Read More News: Futures Rise: Tesla Rival’s Sales Soar, Square Makes Big Deal