The S&P 500 and Dow Jones Industrial Average closed lower Wednesday, retreating from recent record highs, as the stock market rally stumbled ahead of key economic data releases in the coming days.
The Dow and S&P 500 shed 0.7% and 0.2%, respectively, while the Nasdaq finished fractionally higher, boosted by continued gains for AI investor favorite Nvidia (NVDA).
U.S. stocks have recovered from an early-September selloff amid investor optimism that the economy is headed for a soft landing and the Federal Reserve will continue cutting interest rates. Coming into Wednesday’s session, the S&P and Dow were at all-time high levels, while the Nasdaq is only 3% away from a record of its own.
Nvidia shares closed 2.2% higher Wednesday, adding to the previous session’s big gains, while other large-cap technology stocks turned in a mixed performance. Meta Platforms (META) gained 0.9% as the company unveiled new products and AI features at its annual Connect conference, while Microsoft also rose. Apple (AAPL), Alphabet (GOOGL) and Amazon (AMZN) finished slightly lower.
Shares of Micron (MU) gained 1.9% ahead of the release of the company’s earnings report after the closing bell. The shares jumped 15% in after-hours trading after the chipmaker reported strong results and issued an optimistic demand outlook.
The economic data calendar was light on Wednesday, ahead of key releases on the labor market and inflation that are due later in the week, along with several speeches by Fed officials. Investors are keeping a close eye on economic data as they look for confirmation of the health of the economy and information that could affect the Fed’s future decisions on rates.
Gold futures were up slightly late Wednesday near record highs at around $2,680 an ounce, while crude oil futures were down more than 2%, giving back the previous session’s gains. Bitcoin fell to around $63,500 after rising to more than $64,500 overnight, its highest level since early August.
S&P 500 Movers on Wednesday
11 hr 36 min ago
Decliners
- Shares of the financial technology company Global Payments (GPN) plunged 6.5%, posting the widest loss of any stock in the S&P 500 for the second straight day. The payment solutions provider issued underwhelming profit guidance at an investor conference earlier this week, noting it expects a year of transition in fiscal 2025. Analysts at the financial firm BTIG downgraded Global Payment stock to neutral, citing a lack of visibility in the company’s growth trajectory that they believe leaves the stock in “no man’s land” over the coming quarters.
- Amgen (AMGN) shares lost 5.5% after the drugmaker released data from a Phase 3 clinical trial of an experimental eczema treatment. Although Amgen’s drug met its primary endpoint in the study, analysts question whether the results were strong enough for the treatment to merit a strong share in a market already served by Dupixent, a medication jointly developed by Amgen rivals Sanofi (SNY) and Regeneron (REGN).
- Shares of major U.S. automakers moved lower following unfavorable comments from analysts at Morgan Stanley. The investment firm downgraded General Motors (GM) to “underweight” from “equal weight” and scaled back its view on Ford Motor (F) to “equal weight” from “overweight,” citing increased competition in China and a challenging environment for U.S. consumers. GM shares were down 4.9% on Wednesday, while Ford shares slid 4.1%.
Advancers
- Vistra (VST) shares soared 5.9%, securing the S&P 500’s top daily performance after Jefferies and Morgan Stanley boosted their price target on the utility stock. Analysts reacted positively to Vistra’s recent acquisition of the remaining stake in its Vistra Vision subsidiary.
- In addition, the analysts said they believe the recent deal by fellow electricity generator Constellation Energy (CEG) to power Microsoft (MSFT) data centers sets a positive precedent for other attractive agreements. Constellation Energy shares were up 3.7% on the day.
- Shares of Hewlett Packard Enterprise (HPE) jumped 5.1% as Barclays upgraded the stock to “overweight” and lifted its price target. Analysts pointed to signs of recovery in the enterprise hardware business and said they view HPE stock as one of the best ways to invest in this trend. Barclays also believes HPE can continue to increase sales of its artificial intelligence (AI) servers, make gains in the storage market, and benefit from its acquisition of Juniper Networks (JNPR) announced at the beginning of the year.
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- Intel (INTC) shares added 3.2%, extending strong gains posted this week amid reports of a potential investment of up to $5 billion from asset management firm Apollo Global Management. Intel has also reportedly drawn interest from fellow chipmaker Qualcomm (QCOM). In addition, Intel launched two new AI products on Tuesday that are central to its strategy of improving its position in the data center market.
Vistra Powers Higher as Analysts Lift Price Targets
12 hr 37 min ago
Shares of Texas-based power generator Vistra (VST) gained nearly 6% on Wednesday, the largest daily gain of any S&P 500 stock. Vistra is no stranger to market-leading upticks, having surpassed Nvidia (NVDA) as the top-performing stock in the benchmark index this year.
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Several investment firms have suggested there could be even more upside potential for shares of the utility company. In research notes published this week, Jefferies boosted its price target on Vistra shares to $137 from $99, while Morgan Stanley lifted its target on the stock to $132 from $110.
Read the full story here.
Cintas Shares Hit Record High After Strong Earnings
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Cintas (CTAS) shares hit an all-time high Wednesday as the uniform and other workplace supplies provider posted better-than-expected results and raised its guidance.
Cintas reported fiscal 2025 first-quarter earnings per share (EPS) of $1.10, with revenue increasing 6.8% year-over-year to an all-time high of $2.50 billion. Both exceeded estimates.
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CEO Todd Schneider said Cintas “continued to experience strong demand for our services, not only from existing customers, but across our new business pipeline,” according to a transcript of its earnings call provided by AlphaSense.
The company now anticipates full-year EPS in a range of $4.17 to $4.25 versus its earlier forecast of $4.06 and $4.19.
Cintas shares gained 1.2% on Wednesday to close at $207.21. The stock hit an all-time of $209.58 early in the session.
GM, Ford Sink Following Morgan Stanley Downgrade
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Shares of General Motors (GM) and Ford Motor (F) tumbled Wednesday as Morgan Stanley downgraded the stocks and the overall U.S. industry sector because of competition from China.
Calling it the “China Butterfly Effect,” the analysts wrote in a note that the “China capacity ‘butterfly’ has emerged and is flapping its wings.” They noted that the country now produces 9 million more cars than it buys, “upsetting the competitive balance in the West.”
General Motors went to “underweight” from “equal-weight,” and its price target fell to $42 from $47. Ford Motor was dropped to “equal-weight” from “overweight,” with the price target going to $12 from $16.
Morgan Stanley also downgraded the U.S. auto industry to “in-line” from “attractive,” based on “a combination of international, domestic and strategic factors that we believe may not be fully appreciated by investors.” The analysts said that “there are better ways to play rate cuts.”
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Despite today’s 5% decline, shares of General Motors are up more than 25% year-to-date. Ford shares, which are down 4% Wednesday afternoon, are nearly 15% lower in 2024.
HP Enterprise Shares Jump as Barclays Sees AI Opportunity
15 hr 58 min ago
Hewlett Packard Enterprise (HPE) shares jumped Wednesday following an upgrade from Barclays on the information technology’s strength in the booming artificial intelligence (AI) sector.
Barclays raised its rating on HPE stock to “overweight” from “equal weight,” and boosted the price target to $24 from $20. Shares were up 4.6% to $19.75 in afternoon trading.
The upgrade from Barclays comes after Bank of America boosted its rating and price target for HPE last week, in part because of the company’s AI strength. Bank of America said HPE could hold a “command position” in AI adoption because of its “decades of expertise in liquid cooling (CRAY systems) and increased adoption of supercomputing.”
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Key Visa Stock Price Levels to Watch
17 hr 22 min ago
Visa (V) shares were down about 1% Wednesday after slumping more than 5% yesterday following news that the U.S. Department of Justice (DOJ) had filed an antitrust lawsuit against the payments giant.
The stock broke out to a new record high earlier this moth but promptly reversed course, raising the possibility of a bull trap, a chart pattern that lures investors into buying before the price makes a rapid move lower.
Investors should monitor key lower levels on Visa’s chart around $267, $263, and $254, while watching how the price responds to the $290 area if the stock’s uptrend continues.
Read the full technical analysis piece here.
Micron Rising Ahead of Earnings Report
19 hr 12 min ago
Shares of Micron Technology (MU) were up about 2% Wednesday morning as investors await the release of the company’s earnings report after the closing bell.
Analysts expect the memory chip maker and Nvidia (NVDA) partner to swing to a profit for its fiscal fourth quarter. The Street expects the company to report net income of $1 billion for the quarter, compared to a loss of $1.43 billion a year earlier. Revenue is projected to nearly double to $7.65 billion, according to estimates compiled by Visible Alpha.
Read the full earnings preview here.
Trump Media Stock Surges
19 hr 26 min ago
Trump Media & Technology (DJT) stock has shown a bit of bounce this week.
Stepping back a bit, shares of the Truth Social parent company are still well off highs seen earlier this year, when the stock changed hands at nearly $80 per share. But after touching intraday levels below $12 yesterday, they were more recently trading around $14, up about 9% on the day and ahead of Friday’s close of $13.55.
The company’s stock, majority owned by former President Donald Trump, has mostly fallen this year, moving dramatically at times based on its financial results and investors’ estimations of Trump’s political future. Late last week, another dynamic drove trading in the shares: the expiration of lock-up agreements that limited the ability of Trump and some other insiders to sell their shares.
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Trump has said he has no plans to sell his stake in the company. Still, investors have wondered whether he or other large investors in the company might move to sell shares. Others have speculated that the expiration of the lock-ups could spur further pressure on the shares by short sellers.
KB Home Shares Slide After Earnings-Key Levels to Watch
21 hr 41 min ago
KB Home (KBH) shares were down 6% in premarket trading after the homebuilder’s third-quarter profit fell short of Wall Street expectations.
The stock sits poised to fall below the lower trendline of an ascending triangle on Wednesday, opening the door for further price fluctuations.
Investors should monitor key post-earnings price levels on KB Home’s chart at $79, $72, and $64. A measured move, which calculates the distance of the ascending triangle near its widest point and adds that amount to the pattern’s top trendline, projects a price target of $108 if the stock resumes its longer-term uptrend.
Read the full technical analysis piece here.
Major Index Stock Futures Slightly Lower
22 hr 9 min ago
Futures tied to the Dow Jones Industrial Average were down fractionally.
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S&P 500 futures were also down less than 0.1%.
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Nasdaq 100 futures were down 0.2%.
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