U.S. stocks rose on Monday, with tech shares leading the gains as investors gauged the potential impact of President Joe Biden’s withdrawal from the presidential election.
The S&P 500 (^GSPC) rose as much as 1%, while the tech-heavy Nasdaq Composite Index (^IXIC) added about 1.3%, both recovering from their worst weekly losses since April. The Dow Jones Industrial Average (^DJI) rose 0.4% after the index’s sharp decline on Friday.
Semiconductor giant Nvidia (NVDA) led a broader tech rebound after a big sell-off last week as investors pulled out of big name stocks.
Investors are closely watching the political situation after Biden on Sunday gave up his reelection bid and endorsed Vice President Kamala Harris for the Democratic nomination. The political shock could cause further volatility in an already battered stock market and dim focus on a slew of corporate earnings reports and key inflation readings this week.
Biden’s move, not unexpected after weeks of pressure, is seen on Wall Street as reducing the chances of Republican nominee Donald Trump returning to the White House. This could unwind some of the recent “Trump Trade” bets on assets that would benefit from a second term for Trump, including rising bitcoin, bank stocks and Treasury yields. Yields on the benchmark 10-year Treasury Note (^TNX) fell early Monday morning.
Meanwhile, earnings season is about to get into full swing, with a slew of S&P 500 companies scheduled to report earnings within the week, led by Alphabet (GOOGL, GOOG), Tesla (TSLA), and Chipotle (CMG).
The results will provide insight into the economy and consumers ahead of Thursday’s second-quarter GDP report and Friday’s release of the latest personal consumption expenditures (PCE) index, the Federal Reserve’s preferred inflation gauge.
Live7 Update
Monday, July 22, 2024 at 7:47 AM PDT
Tech leads again as Nvidia, Tesla and Alphabet shares rise
Tech stocks led the market again on Monday after heavy selling in large caps on the Nasdaq (^IXIC) and S&P 500 (^GSPC) last week.
The S&P 500 Technology ETF (XLK) rose more than 2%, reversing a recent pullback from the sector.
Semiconductor giant Nvidia (NVDA) rose more than 4%, while EV giant Tesla (TSLA) rose more than 3%.
Social media platform Meta (META) also rose more than 2%. Technology giant Alphabet (GOOGL) (GOOG) also surged more than 2%. Both Alphabet and Tesla are scheduled to report quarterly earnings after the market closes on Tuesday.
Tech stocks led the market again on Monday, with shares of Nvidia, Tesla and Meta rising.
Monday, July 22, 2024 at 7:33 AM PDT
Coca-Cola sees momentum continuing in second quarter despite consumer caution
Investors are hoping Coca-Cola (KO) can maintain its momentum and report strong quarterly results on Tuesday, reports Brooke DiPalma of Yahoo Finance.
Wall Street expects revenue to fall 1.75% year over year to $11.76 billion, according to Bloomberg forecasts. Earnings per share are estimated to increase 3.31% year over year to $0.81.
Meanwhile, Coca-Cola reported first-quarter sales of $11.3 billion, beating Wall Street expectations of $10.96 billion, and earnings per share of $0.72, beating the estimate of $0.70.
The company’s price increases are expected to continue to drive growth this quarter, according to CFRA analyst Garrett Nelson.
Please see here for the detail.
Monday, July 22, 2024 at 6:50 a.m. PDT
Nvidia rises 4% as semiconductor stocks recover
Semiconductor stocks rebounded on Monday after a week of steep declines in the semiconductor industry.
Shares of AI giant Nvidia (NVDA) rose more than 4% at the start of trading after falling more than 8% last week.
Shares of chipmaker ASML (ASML) rose more than 3%, while semiconductor foundry TSMC (TSM) also rose.
The semiconductor sector has been selling off sharply recently as investors pulled out of technology stocks, exacerbating the selloff last week as geopolitical headwinds for the industry emerged.
Semiconductor stocks rebound on Monday
Monday, July 22, 2024 at 6:33 AM PDT
Nasdaq rises after Biden drops out of presidential race
Major stock averages opened higher on Monday as investors gauged the outcome of the presidential election following President Joe Biden’s withdrawal from the 2024 presidential race.
The S&P 500 (^GSPC) surged and the tech-heavy Nasdaq Composite Index (^IXIC) rose 1% at the open after both indexes ended Friday with their worst weekly losses since April. The Dow Jones Industrial Average (^DJI) rose 0.1%.
Biden gave up his reelection bid on Sunday and named Vice President Kamala Harris as his successor as the top Democratic candidate.
Investors are awaiting a slew of earnings and key PCE inflation figures this week.
Companies reporting quarterly earnings this week include Alphabet (GOOGL, GOOG), Tesla (TSLA), and Chipotle (CMG).
Monday, July 22, 2024 at 2:23 AM PDT
Starbuck found Elliot on his doorstep.
It’s good that Starbucks (SBUX) is sounding the alarm.
The WSJ reported late Friday that Elliott Management has acquired a stake in the struggling coffee distributor.
In typical fashion, Starbucks told Yahoo Finance that it “does not comment on rumors or speculation,” but from what I understand, Elliott appears to be involved here.
In X, I outlined 10 problems at Starbucks, many of which are deep-rooted issues that have been pervasive for the past decade and which Elliott, no matter how powerful, is unlikely to be able to solve.
But Bernstein restaurant analyst Danilo Gargiulo sees a path for Starbucks to increase shareholder value.
please:
Invest in top-tier talent and leadership with operational and restaurant experience.
We will limit the increase in the number of stores and accelerate the transition to more specialized stores.
Reset your values.
It provides faster throughput and more predictable service times.
Improve the consumer experience.
Invest in purposeful innovation to attract core consumers and younger generations.
Re-establishing brand neutrality regarding political stances (moving headquarters from Seattle?).
Franchise China business.
Optimize your expenses.
Resetting long-term guidance and market expectations.
Monday, July 22, 2024 at 2:13 AM PDT
Featured: Nvidia
Nvidia (NVDA) is receiving buy orders this morning and is up 2% in pre-market trading following a bullish 30-day trading outlook from Citi.
Citi’s Atiq Malik said:
“We are watching the SIGGRAPH 2024 conference as a positive catalyst for NVDA for three reasons. First, we believe NVIDIA CEO Jensen Huang and Meta (META) CEO Mark Zuckerberg will likely discuss the future of AI and that NVIDIA may unveil its long-awaited standalone Arm-based Grace CPU for servers. Second, the CEO discussion should shed positive light on NVIDIA’s end-customer revenue methods and ROI profile, a topic of recent investor concern. Third, at the conference we heard that AI demand trends are accelerating with no signs of an air pocket, and we view the recent stock sell-off (13% price-to-earnings discount to the 3-year average) due to geopolitical concerns as a buying opportunity.”
SIGGRAPH opens on July 28, and Huang will give two fireside chats.
Monday, July 22, 2024 at 2:06 a.m. PDT
What to watch in today’s session following Biden’s decision
With Biden deciding not to seek reelection, keep an eye on the “Trump Trade.”
Over the past month, stocks that are seen as being linked to President Trump’s policies have rallied. For example, Exxon Mobil (XOM) shares have risen 5% over the past month. Lockheed Martin (LMT) has risen 1.6%, outperforming the S&P 500 (^GSPC).
According to Isaac Boltanski, a policy expert at BTIG, the mood on Trump trade is as follows:
“With the expected emergence of a new Democratic presidential candidate, we may see a reversal in market movements related to the ‘Trump trade.’ This is understandable, as the market will be forced to reassess the possibility of a Trump victory without knowing the official candidate. Furthermore, we believe that once Biden leaves office, the House will be more evenly split than leaning toward the Republicans. That said, we continue to see a slight advantage for Trump, and we note that many of the companies that would benefit from a second Trump administration would be based on administrative shifts rather than legislative changes. These benefiting companies include private prisons, digital assets, and companies exposed to increased M&A. Trump’s trade policies are likely to be largely the same in a divided government scenario. We continue to expect most of the $4.6 trillion in expiring tax measures to be postponed or extended, but generally speaking, spending should be relatively easier in a divided government scenario.”
