Pre-Market: Twitter, GM Falter on Earnings; Coke Takes a Stake in Green Mountain

By Vincent Trivett  FEB 06, 2014 8:55 AM

Weekly jobless claims fall.

 


Stocks were bouyant in pre-market trading this morning despite troubling earnings reports from Twitter (NYSE:TWTR) and General Motors (NYSE:GM). In an encouraging preview of tomorrow's big jobs report, weekly jobless claims fell significantly last week.

Before the opening bell, Dow (INDEXDJX:.DJI) futures were up 0.28% to 15,410. S&P 500 (INDEXSP:.INX) futures rose 0.32% to 1,749.50 and futures on the Nasdaq Composite (INDEXNASDAQ:.IXIC) gained 0.32% to 3,456.50.

Green Mountain Coffee Roasters (NASDAQ:GMCR) shares surged 43.1% in pre-market trading after it was announced that the Coca-Cola Company (NYSE:KO) will pay $1.3 billion to take a 10% stake in the maker of Keurig brewing machines. The two companies will have a 10-year partnership in which Green Mountain will exclusively sell Coke pods for forthcoming Keurig Cold -- a home appliance for making fizzy drinks, juices, and teas. Soda Stream (NASDAQ:SODA), which already makes a similar product, saw shares fall almost 2%.

Hurt by losses in Europe and Asia, General Motors delivered fourth-quarter profit that missed Wall Street's forecasts. Adjusted earnings per share came in at $0.67 as revenue rose to $40.5 billion from $39.3 billion in the same period a year ago. Analysts had expected earnings of $0.87 per share on $40.9 billion in revenue.Its loss in Europe, where GM has seen $18 billion in red ink over the last 14 years, shrank to $345 million from $761 million in the fourth quarter of 2012. In Asia, excluding China, GM lost $200 million. Shares were down 4.1% after the earnings results were announced.

Twitter shares dropped more than 21% overnight after the company reported weak user growth. In its first earnings report as a public company, the social network reported that monthly active users grew by just 9 million to 241 million during the quarter. Analysts had expected Twitter to gain 17 million new users. Timeline views fell by 11 billion to 148 million from the previous quarter. On the brighter side, revenue rose 116% year-over-year to $242.7 million. Earnings per share came in at $0.02. The markets had expected a per-share loss of $0.02 on $217.82 million.

The US released a bevy of important economic data this morning. Initial jobless claims fell by 20,000 to 331,000 last week, beating economists' forecasts by 6,000. Another report found that non-farm productivity rose 3.2% in the last three months of 2013, while unit labor costs fell 1.6%.

In a troubling prelude to tomorrow's official employment-situation report, the outplacement firm Challenger, Gray & Christmas said that announced layoffs rose to 45,107 in January from 30,623 in December 2013.

America's trade deficit widened more than expected to 38.7 billion in December 2013 from $34.3 billion the month before.

The European Central Bank, which was expected to cut interest rates today, opted to stay the course and keep key rates at 0.25%.

Twitter: @vincent_trivett
No positions in stocks mentioned.

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