Stocks closed near session highs Monday, as the S&P 500 (^GSPC) notched its best three-day run in a rip-roaring 2024. Wall Street continued to build on an end-of-week surge precipitated by a softer-than-expected jobs report that helped spur bets toward an earlier rate cut from the Federal Reserve.
The S&P 500 gained 1%, while the tech-heavy Nasdaq Composite (^IXIC) rose 1.2%. The Dow Jones Industrial Average (^DJI) increased almost 0.5%.
Stocks extended their rally from the end of last week, getting a boost from a "Goldilocks" jobs report that struck the balance in providing welcome news for both the markets and the Fed. More than two-thirds of bets are now on a September rate cut from the Fed, according to the CME FedWatch Tool. Most traders now expect at least two cuts by the end of the year.
Those bets could be swung by the return of Fedspeak, now that free-speaking Fed officials are untethered from a pre-meeting blackout period.
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On Monday, New York Fed president John Williams said officials will make rate cut decisions based on the totality of incoming data. Williams assured eventually "we'll have rate cuts," but for now monetary policy is in "a very good place."
Also on Monday, Federal Reserve Bank of Richmond president Thomas Barkin expressed optimism that inflation will come down to 2% as "the full impact of higher rates is yet to come."
Minneapolis's Neel Kashkari is set to speak on Tuesday.
In corporate news, Disney (DIS) will take center stage this week as earnings season starts to wind down. Its stock is up more than 25% so far this year.
After a 6% post-earnings rally on Friday, Apple (AAPL) shares lost around 0.9% after Berkshire Hathaway CEO Warren Buffett revealed over the weekend the company had pared its holdings in the iPhone maker.
Boeing (BA) sank more than 1% in afternoon trading after the the Federal Aviation Administration said it has launched a new probe into the aircraft maker's 787 Dreamliner after the company revealed to regulators last month it may not have completed the required inspections.
A Boeing spokesperson told Yahoo Finance, "we promptly notified the FAA and this is not an immediate safety of flight issue for the in-service fleet."
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Ines Ferré
S&P 500 notches biggest 3-day rally gain of the year
Stocks gained to close around session highs Monday as the S&P 500 (^GSPC) notched its biggest three-day rally gain of the year amid expectations of Fed rate cuts in 2024.
The S&P 500 gained 1% while the tech-heavy Nasdaq Composite (^IXIC) rose 1.2%. The Dow Jones Industrial Average (^DJI) increased almost 0.5%.
On Monday Richmond Fed president Tom Barkin said the current level of interest rates would be enough to eventually bring inflation down to the central bank's target of 2%.
Meanwhile, Federal Reserve Bank of New York president John Williams said a rate cut decision will be made on the totality of economic data but for now, monetary policy is in a "very good place."
Some of the biggest gainers on the Nasdaq 100 (^NDX) included Micron (MU) and Nvidia (NVDA), both up more than 3.5%.
Boeing (BA) shares sank as the the Federal Aviation Administration (FAA) said it had launched a new probe into the aircraft maker's 787 Dreamliner after the company revealed to regulators last month it may not have completed required inspections.
A Boeing spokesperson told Yahoo Finance, "We promptly notified the FAA and this is not an immediate safety of flight issue for the in-service fleet."
All eyes are on Disney (DIS), set to report quarterly results on Tuesday before the opening bell.
Alexandra Canal
Disney earnings preview: set to report first earnings report since Nelson Peltz proxy battle win
Disney (DIS) will report its fiscal second quarter earnings before the bell on Tuesday — its first earnings report since the media giant successfully fended off a high-profile proxy fight with activist investor Nelson Peltz.
As a reminder, Disney recently adjusted its reporting structure after CEO Bob Iger reorganized the company into three core business segments: Disney Entertainment, which includes its entire media and streaming portfolio; Experiences, which encompasses the parks business; and Sports, which includes ESPN networks and ESPN+.
Over the past year, Disney has been grappling with challenges that include a declining linear TV business, slower growth in its parks business, and profitability hurdles in streaming. But a recent turnaround plan from CEO Bob Iger has investors more bullish in recent months.
Here's how Wall Street expects Disney to perform, according to consensus estimates compiled by Bloomberg:
Total revenue: $22.10 billion versus $21.82 in Q2 2023
Adj. earnings per share: $1.10 versus $0.93 in Q2 2023
Entertainment revenue: $10.31 billion
Sports revenue: $4.33 billion
Experiences revenue: $8.18 billion
Disney+ subscribers: 4.71 million versus a loss of 4 million subscribers in Q2 2023
Disney's stock has been on a tear since the start of the year, up about 30% compared to the S&P 500's (^GSPC) 10% rise over that same time period.
The bullish sentiment has been driven by improved financials along with a slew of fresh announcements the company revealed in February — just ahead of its proxy fight win.
"I don't know that [Disney has] a lot left in its pocket for this earnings report," Doug Creutz, managing director at TD Cowen, told Yahoo Finance. "I think numbers will be fine, but I don't think you'll see nearly as much 'new news' as we did three months ago."
A quiet economic data week is usually a good thing for stocks
After several weeks of inflation and Federal Reserve interest rate cuts driving the market narrative, it's all quiet on the economic news front.
There are no notable economic data releases set for this week.
And research from Bank of America shows that's usually a good thing for stocks. Since 2014, the S&P 500 (^GSPC) has risen 0.6% during weeks with no key macro data releases. The median gain in other weeks is 0.2%, per BofA.
Josh Schafer
Companies are having their best earnings season in nearly 2 years
With 80% of the companies in the S&P 500 (^GSPC) done reporting, the benchmark index is pacing for 5% growth in first quarter earnings per share, per FactSet. This is the biggest year-over-year increase since the second quarter of 2022 and higher than the 3.2% growth analysts had expected prior to the start of the season.
"Higher interest rates usually hurt U.S. stock valuations," Jean Boivin, the head of the BlackRock Investment Institute, wrote in a weekly note on Monday. "Instead, strong Q1 earnings have supported stocks even as high rates and lofty expectations raise the bar for what can keep markets sanguine."
Perhaps the most notable move on the earnings front in the past month has come in second quarter outlooks. Thus far, 55% of the companies that have reported have given lower EPS guidance than analysts expected for the current quarter, well below the 10-year average of 63%, per FactSet.
This comes as analysts have remained surprisingly optimistic on the current quarter. Typically, analysts cut earnings forecasts as the quarter rolls on. That hasn't happened yet.
Through the first month of the second quarter, analysts have raised their earnings per share projections for companies in the S&P 500 by an aggregate of 0.7%. This compares to a usual decline of 1.8% over the past 20 years.
DataTrek co-founders Jessica Rabe and Nicholas Colas described this as a "bullish development."
"Even with all the uncertainty around monetary policy, it is hard to see US large caps falling very much when estimate revisions are positive," the DataTrek team wrote. "The bear case for stocks needs an exogenous shock to come along, and quickly."
Richmond Fed president Tom Barkin said Monday he is optimistic that the current interest rates will be enough to eventually bring inflation down, and that the Fed can afford to be patient due to a strong job market.
"The recent data whiplash has only confirmed the value of the Fed being deliberate," Barkin said in a speech at Columbia Rotary Club in South Carolina.
"The economy is moving toward better balance, but no one wants inflation to reemerge."
Barkin’s comments come after inflation showed a lack of progress in the first three months of the year after a steady decline in the second half of last year.
Boeing countdown to Starliner first crewed mission to ISS
Boeing (BA) stock was up more than 1% ahead of the industrial giant's first planned astronaut launch to NASA's International Space Station on Monday night at 10:34 p.m. Eastern.
If the flight proves successful, it could pave the way for NASA to allow Boeing to conduct routine flights to and from the ISS for the agency. Boeing's Starliner program has faced a series of setbacks and delays over the years. The Starliner space capsule failed to reach the ISS in 2019.
Palantir stock rose more than 6% Monday morning to occupy the No. 1 slot on Yahoo Finance's trending ticker page with the software developer's first quarter earnings results due out after the market close. Analysts will be paying close attention to the company's performance in its artificial intelligence platform (AIP) segment.
Shares of Tyson Foods fell Monday despite reporting better-than-expected earnings for the second quarter. While the company beat revenue estimates, it missed on net sales due to a consumer spending slowdown and issues stemming from the company's chicken production operations.
Disney is set to deliver its quarterly results on Tuesday prior to the market open. The print will be the first results released since the media conglomerate won its proxy fight with Nelson Peltz last month. Investors will be watching for subscriber growth in streaming services, parks attendance, and Disney's read on the summer box office.
Ines Ferré
Robinhood gets new legal threat from SEC as crypto crackdown continues
Robinhood (HOOD) said it received a Securities and Exchange Commission warning that the trading platform could face an enforcement action related to its US crypto business.
The so-called Wells notice that Robinhood received May 4 stated that the SEC’s staff made a "preliminary determination" to recommend the action due to violations of registrations as a securities broker and transfer agent.
Its stock, however, rose more than 1% in early morning trading Monday after dropping by as much as 7% before the market open.
Robinhood warned in its disclosure that a potential action from the SEC could mean a civil complaint and a public court proceeding that could end in a fine, a cease-and-desist order, and other limitations on its crypto activities.
The SEC has gone after a number of firms that let US customers trade cryptocurrencies as part of a wide-ranging crackdown on the industry. Read more here.
Ines Ferré
Energy stocks lead gains as oil edges higher
Energy-related stocks gained Monday as oil inched higher. The S&P 500 Energy Sector Select ETF (XLE) rose more than 1%, leading the overall market gains.
Crude futures rose on renewed geopolitical tensions and after Saudi Aramco increased its prices for Asian customers, signaling tight supply.
West Texas Intermediate (CL=F) rose less than 1% to hover above $78 per barrel. Brent, the international benchmark price, also gained (BZ=F) to trade above $83 per barrel.
Last week, oil fell more than 6% amid diplomatic efforts for a ceasefire between Hamas and Israel. By Monday, that prospect had dimmed.
"I believe we have seen some major liquidation in the crude space from hedge funds and therefore, more buying power could be on the sidelines if we get renewed Geopolitical fears," Dennis Kissler, senior vice president at BOK Financial, said in a note to clients on Monday.
Ines Ferré
Stocks edge higher on hopes of Fed rate cuts this year
Stocks opened higher on Monday as Wall Street looked set to continue the market's surge on Friday on bets the Federal Reserve will cut rates this year amid a softening job market.
The S&P 500 (^GSPC) gained 0.4%, while the tech-heavy Nasdaq Composite (^IXIC) rose 0.3%. The Dow Jones Industrial Average (^DJI) rose more than 0.4%.
In corporate news, Disney (DIS) will report quarterly results this week, as earnings season starts to wind down.
Apple (AAPL) shares opened slightly lower Monday after Berkshire Hathaway CEO Warren Buffett revealed over the weekend the company had pared its holdings in the iPhone maker. Apple stock gained more than 6% on Friday in reaction to the company's quarterly results and historic share buyback announcement.
RobinHood (HOOD) revealed it received a "Wells Notice" from the Securities and Exchange Commission (SEC) informing the trading platform of potential securities violations related to crypto trading.
Brett LoGiurato
Monday's quick earnings primer
Via the Yahoo Finance Morning Brief newsletter (sign up here), here's a quick glance at the biggest companies reporting earnings today:
These three stocks have performed impressively this year, but could there be more upside for the remainder of 2024? The post Share Prices of These 3 Singapore Stocks Shot Up 36% or More Year-to-Date: Can Their Run Continue? appeared first on The Smart Investor.
China Evergrande's former CEO, who Chinese regulators recently said was "uncontactable", has sold his home in Hong Kong at a loss of HK$74 million ($9.48 million) from the purchase price, according to a property agent. Xia Haijun last month sold a 2,834 net sq ft (263 sq m) five-bedroom duplex flat in North Point Mid-Levels district on Hong Kong island for HK$82 million, said Gary Lam, a senior sales director at real estate agency Centaline. Xia, who stepped down from the embattled Chinese developer in 2022 after an internal probe found he was involved in diverting loans worth $2 billion secured by unit Evergrande Property Services to the group, bought the flat from New World Development in 2019, according to records from the Land Registry.
Tesla's (TSLA) stock momentum seems to have stalled Friday morning after shareholders voted to approve CEO Elon Musk's pay packages — valued at nearly $46 billion — at the company's annual shareholder meeting on Thursday. Many analysts and Wall Street experts have shared new, incredibly bullish forecasts for the EV company, including Wedbush's Dan Ives — whose latest call sees Tesla's market cap reaching over $1 trillion in 2025 — and Ark Invest (ARKK) Founder, CEO, and CIO Cathie Wood, who believes the stock could reach $2,600 by 2029. However, not everyone shares this enthusiasm around Tesla and Elon Musk. Clean Energy Transition CEO and Portfolio Manager Per Lekander — a long-time Tesla short-seller — joins The Morning Brief to explain his $15 price target, likening Tesla to "the next Enron." "Let's not forget, that the stock is down 60% from all-time high at the same time as the market has gone up, 20, 25% in the meantime," Lekander says, citing Tesla's earnings and its year-to-date stock losses. "So the stock needs to go down. Once it goes down, it's going to go down more. And I think what drives it down is earnings. And I think we are very, very close to the turning point because so far it's been a slippery slope. They've sold cars poorly therefore they lowered the price, therefore earnings went down..." Lekander characterizes Musk as "missing... what's going on in the overall EV space" coming out of COVID-19 pandemic trends. For more expert insight and the latest market action, click here to watch this full episode of Morning Brief. This post was written by Luke Carberry Mogan. Catch up on Yahoo Finance's coverage of all things Tesla, Elon Musk, and his pay package saga: Don't bet against Elon Musk: Dan Ives talks $1T Tesla call Elon Musk wins Tesla shareholder battle to keep his record-breaking pay Elon Musk has been integral to Tesla's growth, AI: Cathie Wood Musk's pay battle is not over. Here's why. Is Elon Musk the right fit as Tesla's CEO? Musk pay package: What's incentivizing shareholder votes Elon Musk's $46B Tesla pay package: Explained
Huawei Technologies' mobile platform HarmonyOS has overtaken Apple's iOS to become the second-biggest mobile operating system in mainland China in the first quarter, according to the latest market data from Counterpoint Research. HarmonyOS accounted for a 17 per cent share in the first quarter to surpass iOS for the first time in the world's biggest smartphone market, as strong domestic demand for Huawei's latest 5G handsets drove up adoption of the Shenzhen-based company's self-developed mobile
We look at the latest software updates from a technology giant and the latest moves by the US central bank. The post Top Stock Market Highlights of the Week: Apple, US Federal Reserve and DBS Group appeared first on The Smart Investor.
Retiring in your 50s doesn't require a superpower, a trust fund, or the lottery, but it does require discipline. Since your investments will have less money to compound, you'll need to contribute...
The Bank of Japan on Friday said it would trim its vast hoard of government bonds as it cautiously steps away from its long-running ultra-loose monetary policy.The central bank kept interest rates unchanged after a two-day meeting but announced plans to "reduce its purchase amount of JGBs (Japanese Government Bonds) thereafter to ensure that long-term interest rates would be formed more freely".
Elon Musk's pay deal — worth up to $56 billion -—has now been approved by Tesla shareholders. Yet investors and analysts Yahoo Finance spoke to are feeling mixed about the future of the electric car company.
NEW YORK (Reuters) -New York Attorney General Letitia James has recovered $50 million from the cryptocurrency platform Gemini Trust to repay investors defrauded in its Gemini Earn program, she said on Friday. Gemini, run by billionaire twin brothers Cameron and Tyler Winklevoss, will provide full recoveries to more than 230,000 Earn investors, including 29,000 in New York, and agreed to a ban on operating crypto lending programs in the state. The payout is in addition to James' related $2 billion settlement with crypto lender Genesis Global Capital, which she announced on May 20.
We recently compiled the list of the 10 Stocks That Are Upgraded by Wall Street Analysts. In this article, we are going to take a look at where Microsoft Corporation (NASDAQ:MSFT) stands against the 10 stocks whose price targets were recently raised by analysts. But first, we are going to take a look at what the […]