Stock futures slide after first trading day in August

Oil giant BP raises dividend as quarterly profits jump on high commodity prices

British oil giant BP increased its dividend on Tuesday as it posted bumper second-quarter profits, benefiting from a surge in commodity prices.

Underlying second-quarter replacement cost profit, used as an indicator of net profit, was $8.5 billion. Soaring profits allowed BP to increase its quarterly dividend to shareholders by 10% to 6.006 cents per common share.

European stocks fall, following global risk aversion sentiment

European markets fell slightly on Tuesday, following global risk aversion sentiment as investors assess whether last month’s rally has yet to continue.

The pan-European Stoxx 600 fell 0.7% in early trading, with basic resources shedding 1.8% to lead losses as nearly all sectors and major exchanges slipped into the red.

Earnings remain a key driver of individual stock price performance. BP, Ferrari, Maersk and Uniper were among the top European companies reporting before the bell on Tuesday.

Chinese stocks fall as tensions rise over Pelosi visit

Flat Open Equity Futures Contracts

Stock futures opened flat in overnight trading on Monday.

Futures contracts linked to the Dow Jones Industrial Average edged down 0.06%, or 21 points. S&P 500 and Nasdaq 100 futures fell 0.06% and 0.01% respectively.

— Samantha Subin

The upside from here is limited over the next few months, says Truist’s Lerner

Investors overinvested in equities should consider using current market conditions to trim their positions, as the upside in equities is limited going forward, says Keith Lerner, co-chief investment officer at Truist.

According to Lerner, market upside over the next few months is likely capped between 3% and 5%, but the downside could exceed that amount.

“The market has been very resilient, no doubt, and maybe it will be for a little while, but we don’t see the risk-reward ratio as compelling here,” he said.

This is by no means an indication of the top of the market and shares could rise, but it is an opportunity to reallocate exposure after the market’s strong rally last month, Lerner added.

Samantha Subin

Pinterest shares rise 21% as Elliott Management reveals position as biggest investor

pinterest shares jumped more than 21% after the company posted higher-than-expected user numbers and Elliott Management revealed it was the image-sharing company’s largest shareholder.

Activist investor Elliott said in a statement that he was “convinced of the opportunity to create value” at Pinterest, calling the social media company a “highly strategic company with significant growth potential.”

“As the market-leading platform at the intersection of social media, search and commerce, Pinterest is uniquely positioned in the advertising and shopping ecosystems, and CEO Bill Ready is the right leader for oversee Pinterest’s next phase of growth,” Elliott wrote.

Despite the stock move, Pinterest missed estimates for the second quarter on both the top and bottom lines, monthly active users for the period exceeded estimates by 2 million.

— Samantha Subin

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