By Aaron McDade
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Stock futures are slightly higher as investors await the release of more inflation data; the Producer Price Index report is expected to show that wholesale inflation picked up last month; Anthropic is reportedly looking to go public next month at a record valuation of $2 trillion; Cerebras shares are tumbling after the chipmaker’s second quarterly report as a public company; and Cisco shares are falling despite strong quarterly results. Here’s what you need to know today.
Stock Futures Inch Higher Ahead of More Inflation Data
Stocks are showing modest gains this morning as the market looks to extend yesterday’s momentum. Dow Jones Industrial Average futures were up 0.3% recently, while S&P 500 futures rose 0.2% and Nasdaq futures added 0.1%. Yesterday, the S&P 500 and tech-heavy Nasdaq gained 0.3% and 0.5%, respectively, powered by strong earnings from a number of AI-related companies, while the Dow closed slightly lower. WTI crude oil futures were down 2% to $81.50 a barrel recently as investors await the latest updates on talks with Iran that have recently fallen apart. Gold futures were down 0.5% at $4,445 an ounce after climbing to a two-month high yesterday, while bitcoin was little-changed at $63,400. The yield on the 10-year Treasury note ticked lower to 4.67%.
Producer Price Index Report Due Out This Morning
Investors get a second straight day of inflation data after yesterday’s Consumer Price Index reading for July came in as expected, showing that price growth slowed for the second straight month after the Iran war sent prices surging earlier in the year. The Producer Price Index report, set to be released at 8:30 a.m. ET, is expected to show that prices rose 0.2% in July, after dropping 0.3% the month before thanks to easing oil prices.1 Investors are keeping a close eye on inflation numbers amid concerns that the Federal Reserve could raise interest rates to contain price increases.
Anthropic Could Target $2 Trillion IPO Valuation With October Debut, Report Says
Anthropic investors are expecting it could go public in October with a $2 trillion valuation, which would top the record for most valuable IPO ever recently set by SpaceX (SPCX), The Financial Times reported.2 The report said Anthropic’s annualized revenue, a popular metric among AI companies taking their most productive month of revenue and extrapolating it to a full year, could reach $100 billion to $120 billion by the end of the year. The Claude chatbot maker faces some risks including intensifying competition with cheaper models coming out of China, along with regulatory uncertainty after Anthropic was forced to take two of its most advanced models down for a few days in June. Anthropic filed confidentially for an IPO earlier this year and would have to release more detailed information than it ever has about its finances, amid worries that AI firms are burning cash without a real path to profitability.
Cerebras Stock Tumbles After Earnings Report
Cerebras (CBRS) shares are sinking despite a solid quarterly earnings report. The chipmaker, which went public earlier this year, said after the bell yesterday that it generated $180.11 million in revenue in the second quarter, growth of more than 70% year-over-year and about $15 million above what analysts had forecast, per Visible Alpha estimates.3 Cerebras posted a “core,” or adjusted loss of $6.91 million, narrower than the $41 million analyst consensus, but its net loss of $450.53 million was nearly $100 million wider than analysts had expected. The chipmaker’s third-quarter sales forecast came in ahead of estimates, and Cerebras also lifted its full-year forecast for “core” revenue. Shares were down 15% in recent premarket trading.
Cisco Stock Falls Despite Solid Results
Cisco (CSCO) shares are also in the red this morning despite a solid report from the networking hardware giant. Cisco said late yesterday that its fiscal fourth-quarter revenue came in at $17.25 billion, up 18% year-over-year and better than analysts had forecast, while adjusted earnings were $1.22 per share, also better than expected.4 However, Cisco’s adjusted gross margins declined year-over-year, which could be a concern for some investors and analysts. Hardware makers such as Cisco have faced increasing costs in recent quarters as shortages for memory chips and other components have led to raised prices, squeezing the margins of some tech companies. Cisco shares were down 6% ahead of the opening bell.
This article has been corrected since it was first published to reflect the FT reported investors are expecting Anthropic to go public in October with a $2 trillion valuation.
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