Coffee With Greta: PCE Inflation Cools

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DJIA Futures: +7 (+0.02%)

SPX Futures: +16 (+0.4%)

NASDAQ Futures: +112 (+0.8%)

Good morning friends!

Futures are rising after the release of the Fed's preferred inflation gauge.

Let’s get right to it!

PCE Inflation In-Line With Expectations

The Fed’s preferred inflation gauge was in-line with expectations in September. 

The Bureau of Economic Analysis’ personal consumption expenditures (PCE) price index rose 0.4% monthly and 3.4% year over year. 

The core PCE price index rose 0.3% monthly and 3.7% annually.

That was the lowest reading for the core PCE since August 2021.

Consumer spending rose sharply during the month, up 0.7% vs 0.5% expected.

Personal incomes increased 0.3% vs 0.4% expected 

Amazon Rallies On Blowout Earnings

Amazon (AMZN) shares are up 5% ahead of the open after solidly beating Q3 expectations on the top and bottom line. 

Here’s how the tech giant’s results compared to analysts’ estimates: 

• EPS: $0.94 vs $0.58 expected
• Revenue: $143.1 billion vs $141.4 billion expected
• Amazon Web Services revenue: $23.1 billion vs $23.2 billion expected
• Advertising revenue: $12.1 billion vs $11.6 billion expected

Revenue jumped 13% year over year while net income more than tripled.

E-commerce sales rose 7% from a year ago, digital ad revenue soared 26%, and Amazon Web Services revenue jumped 12%. 

Amazon forecast Q4 sales will be between $160 billion and $167 billion vs $166.6 billion expected.

The midpoint of that guidance implies 9.6% growth.

Intel Jumps On Earnings Beat, Strong Guidance

Intel (INTC) shares are rallying 7.2% in premarket trade after beating Q3 expectations and issuing strong revenue guidance. 

Here’s how the chipmaker’s results compared to analysts’ estimates: 

• Adjusted EPS: $0.41 vs $0.22 expected
• Revenue: $14.16 billion vs $13.53 billion expected

Revenue fell 8% year over year while the company’s gross margin of 45.8% was flat. 

On the conference call, the CEO said Intel would cut costs by about $3 billion this year.

The CFO said operating expenses were down 15% year over year in Q3, which boosted earnings.

Intel forecast Q4 adjusted EPS of $0.23 on $14.6 billion to $15.6 billion in revenue vs $0.32 EPS on $14.31 billion in revenue expected.

Ford Drops On Earnings Miss

Ford (F) shares are down 3.7% ahead of the open after missing Q3 expectations on the top and bottom line. 

Here’s how the automaker’s results compared to analysts’ estimates: 

• Adjusted EPS: $0.39 vs $0.45 expected
• Revenue: $41.18 billion vs $41.22 billion expected

The CFO blamed that miss on the UAW strikes which began on September 15, saying Ford was “poised” to reach its previous earnings guidance prior to the strikes.

The company’s traditional business, Ford Blue, earned $1.72 billion in Q3, the Ford Pro commercial business earned $1.65 billion, and the Model e EV unit lost $1.33 billion.

The CFO said Ford will delay about $12 billion in previously announced EV investments due to lower-than-expected demand for its electric vehicles.

He also said the new UAW deal reached this week would add $850 to $900 in costs per vehicle assembled and Ford will work to “find productivity and efficiencies and cost reductions throughout the company”.

The company did not issue guidance.

In Case You Missed It

• Pending home sales rose unexpectedly in September. The National Association of Realtors reported the number of contracts signed to purchase a home rose 1.1% last month. That was better than expectations for a 1.5% decrease but still marked the second-lowest reading on record. Pending sales were down 11% year over year. These sales are expected to close in 30 to 60 days and serve as a leading indicator for existing home sales.