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Stock Futures Inch Up As Chip Stocks Weigh, Oil Prices Rise, This Pot Stock Soars

Stock futures recovered to tight premarket gains Wednesday, as rising oil prices countered early losses among chip stocks. Meanwhile, the Apple (AAPL) iPhone event and the approach of Hurricane Florence overshadowed early trade.




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Amazon.com (AMZN) advanced after announcing it would expand its grocery delivery services. Marijuana IPO Tilray (TLRY) appeared set for a third straight gain. Home Depot (HD) headed the continuing advance of storm-related stocks, and Gilead Sciences (GILD) spiked on positive clinical trial results.

Dow futures rose 0.1% above fair value. S&P 500 futures gained a fraction. Chevron (CVX) and Exxon Mobil (XOM) led the Dow. Gilead Sciences notched the S&P 500’s widest early gain, followed by a handful of oil-related names.

Chipmakers sat at the bottom of the morning’s action. Intel (INTC) was down 0.7% on the Dow and Micron Technologies (MU) dropped 4.7%. Micron sat at the bottom of both the S&P 500 and Nasdaq 100.

Nasdaq 100 stock futures edged up 0.2%. Gilead was its top advancer. Chip stocks posted nine of the 10 worst premarket hits among Nasdaq 100 listings.

Stock Futures: Tilray Set For Gap Up Open; China’s Nio Prices IPO

Home Depot edged up 0.2%, Lowe’s (LOW) rose 0.3% and generator manufacturer Generac (GNRC) added 0.9% as investors continued to speculate on the impact of Hurricane Florence. Forecasters see the storm hitting South Carolina late Thursday, then possibly stall over the East Coast. That suggests heavy impact from rain and potential flooding.

Home Depot shares ended Tuesday near the top of a buy range above a 204.35 buy point. Generac was extended above a 53.88 buy point. Lowe’s was extended above a 101.43 buy point.

Cannabis IPO Tilray bolted 7% higher ahead of the open. The British Columbia-based distributor announced Tuesday it had exported its first CBD oil product into the U.K. for medical purposes. Shares are up 47% in September and nearly 500% above their July IPO price.

China-based electric car maker and purported Tesla (TSLA) rival Nio (NIO) was set to launch its IPO. Shares priced at 6.26, the low end of the expected range of 6.25 to 8.25. The pricing values the company at $6.4 billion. Nio aims to raise $1 billion with the offering.

Gilead Surges, Amazon Expands Deliveries

Gilead Sciences popped 3.2% higher after announcing the rheumatoid drug filgotinib hit its targets in a phase 3 clinical study. The biotech giant co-developed the drug with Galapagos (GLPG). Galapagos shares spiked 16% in premarket trade. Gilead is trading below a flat base buy point at 79.14.

Amazon gained 0.2% after announcing plans to expand delivery services from its Whole Foods grocery stores in 10 new cities. They include Las Vegas, Phoenix, Charlotte, Memphis, Nashville and New Orleans. The company also plans service expansion in Los Angeles, New York and Dallas/Ft.Worth. The service launched earlier this year now covers 38 cities, with grocery orders delivered in as little as an hour.

Amazon shares are extended after clearing a three-weeks tight pattern in July.

Apple gained 0.3%, aiming to extend its rebound after Tuesday’s powerful 2.5% gain. Chief Executive Tim Cook is expected to unveil three Apple iPhone models at an event scheduled to begin at 1 p.m. ET. Apple stock tends to fall on the company’s iPhone event day and week. Shares rose 2.5% on Tuesday, but that snapped a four-day losing streak. Apple stock is up 18% since its July 31 earnings report.

IBD 50 stock PGT Innovations (PGTI) tumbled 7% in premarket action. The company announced late Tuesday a follow on offering of 7 million shares of common stock. PGT shares are up 55% so far this year, at new highs and extended after clearing a flat base in July.

Oil Near $70; Producer Prices Post First Slip In 18 Months

Prices paid to producers dipped 0.1% in August, just below expectations for a flat month, and reportedly the first decrease in 18 months. The Labor Department said core prices, minus energy and food, also slipped 0.1%, vs. consensus expectations for a 0.1% gain.

Oil prices rose 1%, sending West Texas Intermediate to just below $70 per barrel, after data from the American Petroleum Institute late Tuesday showed a weekly inventory decrease of 8.6 million barrels, vs. expectations for a 2.7 million barrel draw. The Energy Information Administration releases official supplies data at 10:30 a.m. ET.

Federal Reserve Gov. Lael Brainard speaks at 12.45 p.m. ET in Detroit. The Fed’s August Beige Book report is due out at 2 p.m. ET.

Across global markets, China dug deeper into bear market territory on Wednesday, with the Shanghai Composite and Hong Kong’s Hang Seng index each falling 0.3%. Japan’s Nikkei 225 also dropped 0.3%.

Stocks in Europe recovered their early gains, as miners and energy companies lead the advance. London’s FTSE 100 reversed and rose 0.2%. Frankfurt’s DAX climbed 0.3%. And the CAC-40 in Paris held its 0.6% advance in afternoon trade.

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