Latest Stock News: Nasdaq and S&P 500 Highlights
The Nasdaq closed at a record high on Monday, while the S&P 500 nudged higher, as technology stocks sharply rose ahead of Nvidia’s earnings on Wednesday.
Nvidia, the world’s leading maker of AI processor chips, is one of the last big tech stocks to report this earnings season, giving investors an idea of how explosive growth will continue.
It will also inform traders if the company can remain a leader in the chip industry as Intel, and with Taiwanese peers clamour for the spotlight.
The S&P 500 technology index was up by 1.32% as other chip companies also moved higher, including Nvidia, up 2.49%.
Latest Stock News: Anticipation Around Nvidia Earnings
It will be watching to see if Nvidia’s earnings show that the AI-chip market leader has enough forward momentum to accelerate further.
At least three brokerages raised their price targets for Nvidia following its numbers.
Micron Technology was also up 2.96% after Morgan Stanley upgraded the memory chipmaker from ‘underweight’ to ‘equal-weight’.
The PHLX semiconductor index rose 2.15%.
Nvidia is planning to change its rising form ahead of its the earnings report on 18 th of August.
The S&P 500 and Dow Jones took a contraction today but ended higher.
Latest Stock News: Nasdaq Hits Record High Amid Nvidia Earnings Anticipation
With the Fed picking a half-point rate cut at its recent meeting, markets are open to speculation that the Fed may start to cut interest rates later this month.
The market is sensing the rate cut and other central bankers are factoring this into trades. This trend informed investors about how central bankers are giving up expectations that they could get all their money back by the middle of 2019.
It’s also a month since the tech market first fell more than 15% below its peaks.
This reflects how not just tech but global economic growth has slowed down.
The geopolitical turmoil has caused investors to seek safety, resulting in general bank’s safe stocks outperforming shares.
On Wednesday, the benchmark index in China rose for another third straight session to its highest in almost two months.
Latest Stock News: Federal Reserve and Market Reactions
The Dow Jones Industrial Average dropped 196.82 points, or 0.49%, to 39,806.77. The S&P 500 finished up 4.86 points, or 0.09%, at 5,308.13, and the Nasdaq Composite climbed 108.91 points, or 0.65%, to 16,794.87.
The Dow was held down by a 4.5% drop in shares of JPMorgan after its chief executive Jamie Dimon expressed caution in a conference with analysts and indicated the company will not buy back its shares as the shares trading at present high prices.
Recent good earnings and some signs that inflation might be peaking fuelled speculation the Fed would even be on track to cut interest rates this year.
Major averages shot to new records.
The closely watched blue-chip Dow closed above 40,000 points for the first time, last week.
Comments from four Fed officials on Monday did little to dim expectations that the central bank would trim interest rates this year.
Fed officials were cautious about claims that inflation pressures were easing.
Latest Stock News: Market Valuations and Predictions
Indeed, the rally has left valuations stretched: the S is currently at a forward price-to-earning ratio of 20.8, thanks to historically low interest rates, far above the long-term average of 15.9.
Deutsche Bank now expects the S to reach 5,500 points by the end of 2024, the highest target among large brokerages.
Morgan Stanley expects the index to achieve 5,400 points by June 2025.
Norwegian Cruise Line gained 7.56% after it raised its annual profit forecast.
On the NYSE, advancers edged decliners 1.14 to 1, while on the Nasdaq, decliners edged advancers 1.01 to 1. The S&P 500 posted 58 new 52-week highs and four new lows; the Nasdaq posted 222 new highs and 101 new lows.
Latest Stock News: Nvidia’s Market Impact
As the chipmaker Nvidia is set to report earnings on Wednesday afternoon, traders are already pricing in a massive move for its stock. Options in Nvidia are leafed such that they could swing 8.7% in either direction by Friday, which would translate to a market cap swing of $200 billion – bigger than the market cap of roughly 90% of the S&P 500. That’s a huge move, though it would represent about a 25% slide from the 16.4% jump that Nvidia’s shares logged following the company’s most recent quarterly earnings report.
Volatility and the expectations weren’t nearly as high last time,” says Chris Murphy, co-head of derivative strategy at Susquehanna Financial Group, which is currently long Nvidia. And the chipmaker is a proxy for the rapidly expanding AI industry.
It is up about 87% this year, currently stands as the third-largest company on Wall Street behind Microsoft and Apple, and commands a market value of around $2.3 trillion.%Volatility and the expectations weren’t nearly as high last time,” says Chris Murphy, co-head of derivative strategy at Susquehanna Financial Group, which is currently long Nvidia.
And the chipmaker is a proxy for the rapidly expanding AI industry. It is up about 87% this year, currently stands as the third-largest company on Wall Street behind Microsoft and Apple, and commands a market value of around $2.3 trillion.
Latest Stock News: AI Industry and Market Speculation
The other beneficiaries of the AI theme have gained investor interest in recent months, as the BofA strategists, including Gonzalo Asis write. ‘AI themes appear to be broadening out in power, commodities and utilities.’
Whereas, the BofA strategists estimate that 37% of the S&P500 earnings growth came from Nvidia this year, only 9% of the next 12 months S&P500 earnings growth can be attributed to it.
This is a clear indication of the diversification of the benefits of AI across different sectors reinforcing its position in the latest market news.
Matt Amberson, founder of the options analytics service ORATS, noted that implied volatility for out-of-the-money call options, and out-of-the-money put options, now are ‘uniformly around the same level’, which doesn’t seem to ‘discount any more upside [for Nvidia] going forward, even though it’s already up 170% year to date’.
Latest Stock News: Broader Market Dynamics
European shares closed marginally lower on Tuesday, notching up a third drop in four sessions as fears over interest rate cuts took hold, pushing the pan-European STOXX 600 index 0.2% lower as bank and luxury stocks bore the brunt of the losses.
The Italian share index trailed regional peers the hardest, falling 0.6% to a more than one-week low.
Sentiment for the STOXX index has cooled from record highs since European Central Bank policymakers started suggesting in June and July that interest rate cuts could not be relied upon to follow one after the other.
Markets are betting on interest rate cuts adding up to 66 basis points by the end of the year, with the first one in June. Eurozone negotiated wage data for the first quarter and May manufacturing data out on Thursday might give clues to the health of the economy and how interest rates could turn.
Latest Stock News: Global Market Trends
Investors will also be looking for clues as to whether the momentum that pushed US and European equities to all-time highs last week can be sustained, from minutes to the last meeting of the Fed’s policy committee and Nvidia’s earnings on Wednesday.
German producer prices fell more than expected in April, according to data published on Tuesday, as lower energy prices dented the headline figure.
Drugmaker AstraZeneca was the standout riser on the UK’s FTSE 100 main index, up 2.2%, after saying it seeks to lift revenue by about 75%, pushing revenue past $80 billion by 2030.
Italy’s insurance giant Generali dropped 1.5% after publishing first-quarter results, as some analysts flagged a cut to the insurer’s core profitability in the property and casualty business.
Energy contractor Saipem, meanwhile, rose 4% after winning orders of $3.7 billion, landing a contract with a subsidiary of French oil major TotalEnergies.
Latest Stock News: U.S. Stock Market Movements
The big three US indexes oscillated in narrow range on Tuesday as nervous investors geared up for chipmaker Nvidia’s earnings and for Federal Reserve officials to reiterate that the central bank was in no rush to cut interest rates.
Nvidia, Wall Street’s third most-valuable company, is scheduled to report quarterly earnings on Wednesday, a number that’s certain to be the next big market trigger.
The stock can get pushed higher still if investors demand a much more aggressive forward number.’
In fact, according to Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey, the market is poised for a dramatic swing, with Nvidia options up 8.7%, or $200 billion in market cap, either way by Friday.
Nvidia emerged as one of the greatest successes of the internet age.
In 1999, a group of hard-driving Stanford PhD students raised $2.6 million in capital, and armed with an intuitive concept and a sleek logo, Jeff Fisher, owner of Siegel+Gale, created their name.
Latest Stock News: Market Sentiment and Analysis
Investors also waited for the minutes of the Fed’s latest policy meeting, with two rate-setters arguing that it was ‘wise to wait for several more months’ to see that inflation was on its way to its 2% target before starting to cut rates.
Currently, traders are expecting roughly 44 basis points of rate cuts for this year, a quarter-point cut fully priced for November.
The worst-performing major S&P500 sector index was consumer discretionary, which weighed on the market after the home improvement Lowe’s shares sank 3.1% after issuing a profit warning about operating margin pressure in the current quarter, and auto parts retailer AutoZone fell 3.4% on a third-quarter sales miss.
S&P500 consumer discretionary distribution and retail index were lower by 1.1%.
Latest Stock News: Stock Performance Insights
Shares in JPMorgan Chase gained 1.3%, bouncing back from Monday’s 4.5% shellacking.
Big banks were the major boost to the S&P 500 banks index, which rose 1.2%.
The Dow was a bigger winner than its counterparts on Monday thanks to financials and to a 1.5% rise in Microsoft, which revealed its new line of PCs with artificial intelligence bells and whistles.
It lost 3.4% after the cybersecurity specialist’s fourth-quarter billings forecast missed the mark.
In the plus column, IBM gained 2.2% as it unveiled plans to release a family of artificial intelligence models as open-source software and help Saudi Arabia train an AI system to speak in Arabic.
Eli Lilly climbed 2.5% after the drugmaker won approval from Chinese regulators for its diabetes drug tirzepatide with improved glucose-lowering and reduced weight-gain properties compared with insulin.
Latest Stock News: Market Volatility and Trends
Macy’s eked out flat results, giving up earlier gains as it raised its full-year profit forecast even though it posted a bigger-than-expected sales drop for the first quarter.
Fitness equipment maker Peloton Interactive dropped 13.8%, as it looked to refinance its debt after sales tanked.
01-to-1 ratio on the NYSE and a 1.42-to-1 ratio on the Nasdaq.
The S&P 500 index recorded 34 new 52-week highs and three new lows, while the Nasdaq racked up 62 new highs and 67 new lows.
UK benchmark FTSE 100 was little changed, as upbeat results from the pharma giant AstraZeneca were offset by selloffs in automobiles/parts stocks.
Latest Stock News: Economic Indicators and Predictions
Although two Federal Reserve policymakers highlighted the benefits of waiting before cutting interest rates and continuing inflation worries, consumer prices index statistics due on Wednesday and awaited signals on the Bank of England’s interest rate cutting trajectory looked set to weigh on investors’ sentiment.
Also out was Nvidia’s quarter, set to move the broader markets given the hype around artificial intelligence.
Among other corporate news, SSP Group was the worst-performing company on the mid-cap index, shedding 9% after it posted half-year EBITDA that missed expectations.
Latest Stock News: Cryptocurrency and Commodity Markets
Wall Street stocks closed mixed on Tuesday and US Treasury yields pulled back as markets had no real issues to propel them higher.
Cryptocurrencies jumped higher after the US Securities and Exchange Commission (SEC) signaled approval of a spot ether exchange-traded fund was a real possibility.
Ethereum climbed 7.7% and bitcoin spiked 1.3%.
Latest Stock News: Trading opportunities
As the persistence of inflation and ‘higher for longer’ interest rates – the precise enablers of the lofty prices – spawned fears about demand, oil prices extended losses into a third straight day.
US crude was last down 0.75% at $79.20 per barrel, and Brent crude fell 0.6% to end at $83.21.
Gold prices remained close to their all-time high after Fed policymakers maintained an air of caution.
Spot gold added 0.2% to $2,429.66 an ounce.
Latest Stock News:
It is reflecting corporate earnings and news, enamoured of a techno-hype, flush with investor sentiment on AI and comforted by the prospects of a rate cut.
Before Nvidia issues its earnings, the implied volatility dropped sharply this week as markets began looking outwards for trends that might derive from Nvidia’s results.
As long as the economy continues to grow, corporate performance remains resilient, and geopolitics remains unsettled, stock markets will be pushed and pulled up and down.
