5 Things to Know Before the Stock Market Opens

Stock futures are lower Tuesday morning after major indexes fell sharply to open the week; Home Depot reported lower quarterly profits than analysts had expected; Apple’s new iPhone 17 gave the smartphone maker its best month of market share in China in three years; Nvidia stock is moving lower again as investors prepare for the chipmaker’s results; and buy now, pay later firm Klarna posted its first earnings report since going public in September. Here’s what investors need to know today.

Stocks Poised to Open Lower After Sharp Losses to Start Week

Stock futures are pointing to a lower open Tuesday after each of the major indexes lost ground in Monday’s trading session. Futures tied to the Dow Jones Industrial Average and S&P 500 were recently down 0.7% and 0.5%, respectively, while those connected to the tech-heavy Nasdaq dropped 0.6% amid ongoing concerns about the possibility of an AI bubble (see more below). Bitcoin was at $91,300, after falling to a seven-month low overnight below $90,000. Gold futures were down 1% at $4,030 an ounce, while crude oil futures fell slightly to just under $60 per barrel. The yield on the 10-year Treasury note, which affects all sorts of consumer loans, was at 4.11% recently, down from 4.13% late Monday.

Home Depot Stock Drops as Profits Miss Estimates

Home Depot (HD) kicked off a busy week of retail earnings Tuesday morning, reporting a 4 cent year-over-year decline in adjusted earnings per share to $3.74, while revenue grew 2.8% to $41.35 billion. Sales topped analysts’ estimates compiled by Visible Alpha, while adjusted EPS fell short by 10 cents. CEO Ted Decker said the retailer believes its results fell short of its own expectations because of a continuously weak housing market and a lack of severe storms in the quarter, which hampered demand for home improvement products. Shares of Home Depot, a Dow component, were down more than 3% in recent premarket trading. Other major retailers set to report earnings this week include home improvement rival Lowe’s (LOW), Target (TGT), TJX Companies (TJX), Ross Stores (ROST), BJ’s Wholesale (BJ), Gap (GAP) and Walmart (WMT), which announced a CEO succession plan last week.

Apple Gets a Boost From Strong China iPhone Sales

Apple’s (AAPL) newest slate of iPhones, the iPhone 17, appears to be boosting the company’s efforts to return to the role of market leader in China. The tech giant saw a 37% increase in smartphone sales in the region in the month of October, according to data from Counterpoint Research reported by Bloomberg, as China’s overall smartphone market grew 8% in the month. Apple was responsible for about a quarter of smartphones sold in China in October, the first time it has hit that mark since 2022, per Bloomberg. China is a key market for Apple, but the iPhone maker has been losing ground to domestic competitors in recent years. Apple shares, which hit a record high a week ago, were up slightly in premarket trading.

Nvidia Shares Extending Losses Ahead of Earnings

Nvidia (NVDA) shares are losing ground again this morning as investors prepare for the chipmaker’s highly anticipated earnings report after the closing bell tomorrow. Investors have been rattled recently by growing questions about whether the artificial intelligence boom has created a bubble in the stock market. The AI-fueled rally has turned Nvidia into the world’s most valuable company, as it is the recipient of much of the spending from “hyperscalers” such as Microsoft (MSFT), Alphabet (GOOG), Amazon (AMZN) and Meta (META). Nvidia is expected to report rising revenue and profits, though investors and analysts will likely be focused more on CEO Jensen Huang’s comments about the outlook for demand. Traders are pricing in the likelihood of a big move in Nvidia shares after the earnings report is released. The stock, which fell nearly 2% on Monday, was down about 1% this morning.

Klarna Releases First Earnings Report Since IPO

Klarna (KLAR), a buy now, pay later company that went public in September, released quarterly results that topped Wall Street estimates. Klarna said its revenue grew to $903 million, while it lost $0.25 per share in the quarter, each better than the analyst consensus compiled by Visible Alpha. Gross monetary value, or the total amount of products bought with Klarna’s services, beat estimates at $32.7 billion, as did its number of active users at 114 million. Shares were up slightly in recent premarket trading. Klarna’s stock has trended lower since its IPO in September, but analysts have stayed bullish on the stock.