Wall Street Today | Long Weekend Led to Market Slump, Nvidia A Close Watch
RECAP
U.S. stocks traded lower Tuesday as investors returned from a holiday weekend cautiously amid earnings reports shedding light on consumers, with crucial earnings from AI-darling $NVIDIA (NVDA.US)$ expected Wednesday.
The $S&P 500 Index (.SPX.US)$ dipped 0.60%. The $Dow Jones Industrial Average (.DJI.US)$ fell 0.17%, while the $Nasdaq Composite Index (.IXIC.US)$ -0.92%, brought down by AI and semiconductor companies falling alongside a Nvidia price pullback.
News of a $35 billion credit card merger sent $Capital One Financial (COF.US)$ shares 4.8% lower after with plans to purchase $Discover Financial Services (DFS.US)$, up 10% after the news.
MACRO
January US Leading Index Falls More Than Expected, Conference Board No Longer Sees 2024 Recession
The Conference Board's measure of leading indicators fell 0.4% in January, below expectations for a 0.3% decrease in a survey compiled by Bloomberg as of 7:50 am ET and following a 0.2% decline in December.
"The US (leading economic index) fell further in January, as weekly hours worked in manufacturing continued to decline and the yield spread remained negative," said Justyna Zabinska-La Monica, Conference Board senior manager of business cycle Indicators.
"While the declining LEI continues to signal headwinds to economic activity, for the first time in the past two years, six out of its 10 components were positive contributors over the past six-month period."
The Conference Board said Tuesday it no longer expects a recession in 2024 but does forecast real GDP growth to slow to almost 0% in Q2 and Q3.
SECTORS
Nvidia Leads AI Stocks Lower
A day before posting earnings, $NVIDIA (NVDA.US)$ fell 5% as the market opened. AI-related stocks that build computing hardware fell in concert, leading to a 3% drop in the overall semiconductor sector according to moomoo industry heat maps.
Nvidia Leads AI Stocks Lower
A day before posting earnings, $NVIDIA (NVDA.US)$ fell 5% as the market opened. AI-related stocks that build computing hardware fell in concert, leading to a 3% drop in the overall semiconductor sector according to moomoo industry heat maps.
$Arm Holdings (ARM.US)$ fell 7% after a startling 60%+ jump following the chip design company's earnings.
Investor favorite $Super Micro Computer (SMCI.US)$ fell 10%, pulling back from a 100%+ gain since the start of the year.
$Advanced Micro Devices (AMD.US)$ also fell 5%.
WTI Crude Oil Closes Lower as Demand Worries Trump Middle East Tensions
West Texas Intermediate closed lower on Tuesday as geopolitical worries amid violence in the Middle East were more than offset by demand concerns.
WTI crude oil for March delivery closed down US$1.01 to settle at US$78.18 per barrel, while April Brent crude, the global benchmark, was last seen down US$1.37 to US$82.19. Futures put $Crude Oil Futures(JAN5) (CLmain.US)$ at $77.
Bitcoin Pullback Effecting Coinbase, Marathon Digital, Riot Platforms
Shares of several $Bitcoin (BTC.CC)$ related stocks fell Tuesday to follow the cryptocurrencies trading lower 1.33% after noon. $Coinbase (COIN.US)$ fell 8%, while $MARA Holdings (MARA.US)$ fekk 13% and $Riot Platforms (RIOT.US)$ fell 6%.
Bitcoin hit its highest level since December 2021 last week and Ethereum just crossed the $3,000 level for the first time since 2022.
COMPANIES
Palo Alto Networks -13% After Q2 '24 Beats EPS, Down on Guidance
$Palo Alto Networks (PANW.US)$ reported fiscal second-quarter 2024 EPS of $1.46 per diluted share, above expectations of $1.30. The stock fell on the outlook for the third quarter, stating a target $1.24 to $1.26 EPS compared to $1.30 expected.
Discover Shares Jump 12% as Company Agrees to be Bought by Capital One
$Discover Financial Services (DFS.US)$ shares climbed 11% after the company agreed to be bought by $Capital One Financial (COF.US)$ in a $35 billion all-stock deal.
Tesla -4% After Adam Jonas' Investor Survey Reveals Overwhelming Negativity
Morgan Stanley analyst and $Tesla (TSLA.US)$ bull Adam Jonas conducted an investor survey on Monday to note the overwhelming negative sentiment on the EV giant's shares. The analyst, however, continues to be bullish.
FuboTV Sues to Block ESPN, Warner and Fox Sports-Streaming Service
Sports-centric streaming service $FuboTV (FUBO.US)$ sued the media companies behind a new sports-streaming platform scheduled to launch this fall, alleging they wouldn't let Fubo carry a small bundle of sports-focused channels that they are now looking to include in the new service.
Home Depot Shares Fall After Retailer Reports Lackluster Home-Improvement Spending
$Home Depot (HD.US)$ shares fell after the company reported that quarterly sales declined as home-improvement spending continues to moderate from pandemic highs.
Walmart's Stock Heads for a Record After Earnings Beat, Vizio Buyout Deal
$Walmart (WMT.US)$ jumped further into record territory Tuesday amid a busy day for the discount retail giant, which reported an earnings beat, confirmed a $2.3 billion deal to buy smart-TV maker $VIZIO (VZIO.US)$ and raised its dividend by 9%.
Source: Bloomberg, Dow Jones, CNBC, Reuters
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