U.S. futures markets are pricing in a positive open Tuesday as Asian markets ended their trading day in the green. Markets appear to have calmed somewhat, as the likelihood of Thursday's Brexit vote leading to the U.K. leaving the European Union appears to have diminished.
Federal Reserve Chair Janet Yellen is due to begin her two-day testimony to Congress this morning, which is sure to have investors looking for further clues into the Fed's movements.
As Yellen speaks, bank stocks are sure to react, as hints about the course of monetary policy could have great impact on the banks' net interest margins. The banks are about to get a double whammy of Fed pressure this week: the Fed will also be releasing the results of its annual stress test Thursday. Particular attention will be paid to Bank of America (BAC), which has faltered in previous stress tests.
Marathon Oil (MRO) was upgraded to Overweight/Attractive from Equal Weigh by an analyst team at Morgan Stanley. The positive ratings action comes a day after the Texas-based oil and gas company announced that it plans to purchase Payrock Energy Holdings for $888 million. The acquisition allows Marathon to build up its position in the lucrative Anadarko Basin STACK play in Oklahoma. Shares of Marathon were up nearly 1% in premarket trading.
Analysts at Jefferies cut their price target on Nike (NKE) to $67 from $74, while maintaining a Buy rating on the athletic apparel company. Nike remains a top pick among Jefferies' analysts but the team worries about the near-term impact of increased competition in the sector, particularly in basketball. On the plus side, Jefferies notes that Nike shares tend to outperform the market during the Summer Olympics and World Cup.
Opko Health (OPK) shares gained nearly 8% in premarket trading after the Food and Drug Administration approved the company's drug, Rayaldee. The drug is used in treating secondary hyperparathyroidism associated with vitamin D insufficiency in patients with stage 3 and 4 chronic kidney disease. Rayaldee was expected to get FDA approval in March, but failed to do so after the FDA observed "deficiencies" at one of Opko's third-party contract manufacturers. With Tuesday's approval, the FDA expects to launch the drug later this year.
-- Written by Carleton English
