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Pre-markets Down on Tension Between U.S. And China

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U.S. stock futures have dropped in today’s pre-market following tensions between the United States and China. Market participants will also closely monitor second-quarter 2022 earnings results as 270 companies are slated to report their quarterly numbers.

U.S. House of Representatives Speaker Nancy Pelosi is expected to arrive in Taiwan today and stay the night there. China has expressed strong reservations against Pelosi’s visit to Taiwan.

Chinese authority claims that Taiwan is part of its territorial integrity while the U.S. government has replied that the Biden administration will not bow down to China’s threat. Reuters reported that Chinese warplanes flew and warships remained close to the line dividing the Taiwan Strait.

Pelosi would become the first House Speaker to visit Taiwan since Newt Gingrich in 1997. Following the U.S.-China geopolitical conflict, the yield on the benchmark 10-Year U.S. Treasury Note fell around 2.54% as investors opted for safe-haven government bonds.

On the M&A front, Canada’s Toronto-Dominion Bank (TD - Free Report) has decided to purchase U.S. based investment-bank Cowen Inc. in an all-cash deal of $1.3 billion. The banking sector of Canada is dominated by six big brothers that control nearly 90% of the market share. The acquisition of Cowen is an effort by Toronto-Dominion Bank to expand business in the high-growth U.S. market.

A plethora of companies will report earnings today. Oil refining and marketing bigwig Marathon Petroleum Corp. (MPC - Free Report) has come up with quarterly earnings of $10.61 per share, beating the Zacks Consensus Estimate of $9.17 per share. The company posted revenues of $54.24 billion, surpassing the Zacks Consensus Estimate by 63.08%.

Caterpillar Inc.(CAT - Free Report) has reported quarterly earnings of $3.18 per share, beating the Zacks Consensus Estimate of $3 per share. The heavy equipment maker posted revenues of $14.25 billion, missing the Zacks Consensus Estimate by 0.34%.The company said that growing material and freight costs were partially offset by higher prices and increased sales.

Global luxury hotel Chain giant Marriott International Inc.’s (MAR - Free Report) quarterly earnings of $1.80 per share beat the Zacks Consensus Estimate of $1.59 per share. Marriott recorded revenues of $5.34 for the quarter ended June 2022, surpassing the Zacks Consensus Estimate by 7.41%.

Electronics manufacturing major Eaton Corporation plc (ETN - Free Report) has registered quarterly earnings of $1.87 per share, beating the Zacks Consensus Estimate of $1.82 per share. The company posted revenues of $5.21 billion, missing the Zacks Consensus Estimate by 0.29%.

Major companies that will report after the closing bell today are restaurant retailer Starbucks Corp. (SBUX - Free Report) , micro-chip developer Advanced Micro Devices Inc. (AMD - Free Report) , Internet-based payment platform PayPal Holdings Inc. (PYPL - Free Report) and crude oil producer Occidental Petroleum Corp. (OXY - Free Report) .

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