Nvidia, Tesla, Rest of Mag 7 Lift Stock Market Higher | Wall Street Today

Moomoo Recap US joined discussion · Jul 22 15:40

Nvidia, Tesla, Rest of Mag 7 Lift Stock Market Higher | Wall Street Today

The $S&P 500 Index (.SPX.US)$ recovered from its biggest weekly slump since April, and the $Nasdaq Composite Index (.IXIC.US)$ rebounded, buoyed by gains in $NVIDIA (NVDA.US)$, $Tesla (TSLA.US)$ and the rest of their Magnificent Seven peers.

Nvidia, which dominates the semiconductor market for chips used to power artificial intelligence applications saw its shares climb 4.8% Monday, recouping some of its loss last week. Earlier Piper Sandler analyst Harsh Kumar raised his price target on the stock, optimistic that the company's quarterly revenue will again blow past analysts' estimates.

The S&P 500 gained 1.1% to close at 5,564.41 Monday, while the Nasdaq rose 1.6% to 18,007.568. The $Dow Jones Industrial Average (.DJI.US)$ added 0.3% to 40,414.44.

Big tech is giving the stock market a boost at a time when investors are weighing the prospects for a Trump Trade, and pondering what a Kamala Harris Trade would look like after President Joe Biden backed off the presidential race and endorsed his vice president for the top post in elections due in November.

MACRO

In the absence of any new economic data released Monday, the market stuck to trades that price in a 25 basis point cut in the September meeting by the Federal Reserve. Traders are pricing in an almost 92% chance that the key interest rate will be at a range of 5% to 5.25% in the September meeting, up from 59.5% a month ago, according to the CME FedWatch tool.

SECTORS

Treasury yields advanced to the highest in almost two weeks Monday as investors gauge whether the change in the presidential candidate for the Democratic Party to Harris, from Biden, would result in a shift in investor sentiment.

Later this week, the personal consumption expenditures (PCE) price index for June could provide a better clue on the rate path in the U.S. Another indicator investors are watching is the auction of $69 billion in two-year notes that could gauge the appetite for U.S. debt and its increasing supply.

In the oil market, West Texas Intermediate crude futures fell to the lowest since mid-June amid concerns over global demand for the fuel. The outcome of the U.S. presidential race could also affect the industry, with Republicans calling for continued exploration and development of oil rigs, while the Democrats continue to promote the use of renewable energy.

MOVERS

$NVIDIA (NVDA.US)$'s revenue for its fiscal first quarter ending this month could beat the average estimate of analysts by more than $2 billion, boosted by a rebound in networking supply, MarketWatch reported, quoting Kumar. He raised his price target for the stock to $140, from $120, signaling an upside potential of more than 10% from its current level.

The stock of the third-largest company by market capital, behind $Apple (AAPL.US)$ and $Microsoft (MSFT.US)$, rallied 4.8% to close at $123.54, helping fuel the bounce seen in the broader stock market. Those gains also added to the advance in the PHLX Semiconductor Index.

$Tesla (TSLA.US)$ shares rose ahead of earnings results. Tesla is expected to report second quarter earnings of about 48 cents a share on revenue of $24.7 billion, according to the average estimate of analysts polled by Capital IQ.

$AMC Entertainment (AMC.US)$ rallied Monday after the company said it's refinancing its $1.6 billion debt to extend the maturity.

$CrowdStrike (CRWD.US)$ fell another 13%, extending Friday's slump that was fueled by a buggy software update that triggered a global outage.

$Verizon (VZ.US)$ shares slipped after its second quarter sales missed analysts' estimates.

(To see the options market page, click here.)

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