Stock Index Roundup: Nvidia, Chipmakers Lagging, Other Tech Giants Gaining
2 hours 54 minutes ago
Dow
Tech stocks on the index were mostly higher, with Intel (INTC) up 1.5%, Salesforce (CRM) up 1.3% and Microsoft (MSFT) up 0.9%, as selling in AI stocks weighed on the broader IT sector.
Boeing (BA) rose 0.3% after reports it was close to a deal to buy supplier Spirit AeroSystems (SPR).
American Express (AXP) rose 0.1% after acquiring restaurant reservation company Tok.
JPMorgan Chase (JPM) and Goldman Sachs (GS) fell after U.S. regulators determined their respective living wills were “defective.” Goldman fell 1.7% and JPMorgan fell 1.2%.
Apple (AAPL) was up for most of the day before dropping 1% in the final minutes of the session, which could be a byproduct of today’s triple witching or a major rebalancing of major index funds.
S&P 500
FactSet Research (FDS) rose 3.8% after reporting better-than-expected quarterly earnings and raising its full-year outlook.
Gilead (GILD) rose 3.2%, its second straight day of gains after the company said its injectable lenacapavir is 100% effective in preventing HIV infection in women.
Nvidia (NVDA) fell 3.2%, its second straight day of losses, after briefly overtaking Microsoft as the world’s most valuable company on Tuesday.
Hewlett Packard Enterprise (HPE) fell 2.8% on the back of declines in Nvidia and other AI stocks, while semiconductor giants Broadcom (AVGO) and Micron (MU) fell 4.4% and 3.2%, respectively.
Capital One Financial (COF) fell 1% after it was reported that it had settled a lawsuit related to its credit card partnership with Walmart (WMT).
Nasdaq 100
Alphabet (GOOGL) rose 1.9% to close at a record high.
Amazon (AMZN) rose 1.6%, shedding about $30 billion to a market cap of $2 trillion.
Chipotle shares stall ahead of 50-for-1 stock split
4 hours 23 minutes ago
Shares of fast-casual restaurant chain Chipotle Mexican Grill (CMG) were flat on Friday afternoon after dropping 6.2% on Thursday, its biggest one-day percentage drop since last July.
The company’s shares have risen more than 40% since the beginning of the year and have more than doubled since the beginning of 2023, meaning institutional investors may be taking profits ahead of a 50-for-1 stock split next Wednesday.
CMG shares found support near the 200-day moving average (MA) in October last year and have since been on a steep uptrend with buyers stepping in on the pullback to the 50-day MA.
Earlier this week, the stock surpassed a period of consolidation to hit new highs, but a volatile day on Thursday saw it close below the breakout point on its highest trading volume since late March, signaling a possible bull trap.
Additionally, while stocks have been hitting new highs this week, the relative strength index (RSI) has also been hitting new highs, creating a bearish divergence that suggests momentum is weakening.
Read more here to find out where this stock can find support ahead of its stock split next week.
–Tim Smith
Stocks to watch on Friday
5 hours 23 minutes ago
FactSet Research Systems (FDS) Shares rose after the financial data provider reported better-than-expected profits and raised its outlook for revenue growth from institutional investors, asset owners, partners and corporations.
of stocks Sarepta Therapeutics (SRPT) The biotech’s shares soared after the U.S. Food and Drug Administration expanded approval of its treatment for a rare pediatric muscle disorder, a decision that also boosted shares of Catalent (CTLT), which has a manufacturing contract with Sarepta for the drug.
Boeing (BA) Supplier Shares Spirit AeroSystems (SPR) The stock price surged after reports that Boeing was close to buying the company. Boeing shares also rose slightly.
Capital One Financial (COF) The stock price fell after the company settled a lawsuit filed by Walmart (WMT) over its credit card partnership. Walmart’s stock price rose.
of stocks American Express (AXP) Credit card company acquires Tock restaurant reservation system for $400 million Squarespace (SQSP)Squarespace’s stock price rose.
Allstate (ALL) Shares fell after the company estimated a devastating loss in May at $1.4 billion, nearly triple April’s figure.
–Bill McCall
Narrowing range increases risk of S&P 500 pullback
6 hours 39 minutes ago
The S&P 500 has been breaking record after record over the past month, but open the hood and things aren’t much better.
The A/D line, a measure of market breadth, has continued to fall since the end of May even as the S&P 500 surged to new highs, according to a Friday note from LPL Financial.
A sharp rise in the S&P 500 and a falling A/D line could be cause for concern on Wall Street, as shown in the chart below from LPL Financial. This suggests that gains in a few large stocks are masking weakness in smaller stocks, which could signal weakening investor sentiment.
LPL Financial
Lately, the S&P 500’s returns have been driven by a trio of $3 trillion market cap tech giants — Microsoft (MSFT), Apple (AAPL) and Nvidia (NVDA) — which have all surged to all-time highs in recent weeks, along with smaller and mega-cap names like Broadcom (AVGO), Oracle (ORCL) and Adobe (ADBE), buoyed by earnings reports showing strong demand for AI products.
But the rest of the market is struggling. As of Thursday’s close, Information Technology (+10.7%) was the only sector to outperform the S&P 500 (+3.7%) so far this month. Only Consumer Discretionary (+3.3%) and Communication Services (+2.7%), dominated by AI giants Amazon (AMZN), Alphabet (GOOGL), and Meta (META), were within one percentage point of the broad index.
Adam Turnquist, chief technical strategist at LPL Financial, noted that the aforementioned divergence in the A/D line does not signal the end of the bull market, “but it does signal a growing risk that the broader market may pause or pull back.”
FactSet shares rise after it beat third-quarter profit estimates and raised guidance
7 hours 48 minutes ago
Shares of financial data provider FactSet Research Systems (FDS) rose on Friday after the company reported much better-than-expected profits and raised its full-year outlook on higher revenue from institutional investors, asset owners, partners and corporations.
The company reported third-quarter fiscal 2024 adjusted earnings per share (EPS) of $4.37, well above the $3.90 consensus estimate compiled by Visible Alpha. Revenue rose 4.3% year over year to $552.7 million, roughly in line with expectations. Organic sales increased 4.5%.
Adjusted operating margin increased to 39.4% from 36.0% in the same period last year, and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $239.9 million, up 16.9%.
The company’s annual subscription value (ASV) and professional services were $2.22 billion, up 4.7%. FactSet’s user base increased by 1,662 to 208,140. The company noted that the increase was across all business types except banks, and was primarily driven by high net worth clients.
FactSet raised its full-year adjusted EPS outlook to a range of $16.00 to $16.40, up from a previous range of $15.60 to $16.00, but now sees sales falling to a range of $2.21 billion to $2.18 billion, down from $2.2 billion previously.
FactSet’s shares rose 3%, but are down more than 10% so far this year.
–Bill McCall
Sarepta Therapeutics soars as new muscular dystrophy drug approval expands
8 hours 51 minutes ago
Shares of Sarepta Therapeutics (SRPT) soared on Friday, the day after the Food and Drug Administration allowed expanded use of the biotech company’s treatment for a rare pediatric muscle disease that primarily affects boys.
The company said its drug, Erebidis, received previous approval for patients with Duchenne muscular dystrophy (DMD) who are at least four years of age and have a confirmed genetic mutation. DM They have the genes and can walk.
Sarepta said regulators granted accelerated approval for use in people with non-ambulatory conditions, but that continued approval “may be contingent on verification of clinical benefit in a confirmatory trial. ” The company added that a confirmatory Phase 3 trial is currently underway.
Last year, the FDA granted accelerated approval for a gene therapy drug for 4- and 5-year-olds, despite lingering questions about its effectiveness.
Sarepta’s shares have soared 40%, bringing their year-to-date gains to about 80%.
–Bill McCall
Gold regains shine as investors focus on rate cuts — key price levels in focus
10 hours 18 minutes ago
Gold remained in focus on Friday after rising more than 1% to a two-week high on Thursday as recent lackluster economic data has boosted investor expectations that the Federal Reserve will cut interest rates later this year.
While a U.S. government report last week showed inflation was easing, data on Tuesday showed a slowdown in retail sales, signaling a slowdown in economic activity and suggesting the Fed’s high interest rate policies to combat inflationary pressures are working as intended.
According to the CME FedWatch tool, which predicts interest rate movements based on data from federal funds futures contracts, market participants currently rate the likelihood of a rate cut in September at 66%.
Investors generally view lower interest rates as a positive for gold prices because they put downward pressure on the U.S. dollar, making dollar-denominated products cheaper for buyers using foreign currencies and helping to stimulate demand. Lower interest rates also reduce the opportunity cost of holding non-yielding assets such as gold compared to lower-risk investments such as bonds.
Looking at the weekly chart, gold prices broke out of a year-long trading range in early March and initially continued to trend upwards, but have been trading in a narrow rectangular pattern since mid-April, suggesting a pause in momentum before surging again.
If gold prices break above the upper trendline of the rectangle to a new all-time high, investors can use the measuring principle to determine a price target. To do this, calculate the distance in dollars of the move preceding the pattern and add that amount to the breakout point. In this case, add $448 to $2,414 to project a price target of $2,862. Conversely, if prices break below the rectangle, keep an eye on the $2,080 level, where they are likely to find support from the upper trendline of the previous trading range.
–Tim Smith
Stock futures mixed
10 hours 52 minutes ago
Dow futures were flat in premarket trading Friday.
S&P futures fell 0.2%.
Nasdaq futures fell 0.2%.
