Stock Indexes Wrap: Tesla, Apple Lead Indexes Higher; Alphabet, Meta Weigh on Communications Sector
April 29, 2024 04:10 PM EDT
The Dow
Boeing (BA) climbed 3.8% amid reports it had tapped the bond market to raise $10 billion after last week reporting it burned through nearly $4 billion in cash in the first quarter.
Apple (AAPL) rose 2.5% after analysts at Bernstein upgraded the stock to outperform, calling the recent pullback a good entry point for investors.
Intel (INTC) shed 1.6%, falling for a second consecutive session after last week’s disappointing earnings report.
The S&P 500
Tesla (TSLA) led the index higher, jumping 15.3% amid reports CEO Elon Musk had received approval from Chinese authorities to introduce the company’s full self-driving system in the country.
Domino’s Pizza (DPZ) added 5.6% after its quarterly earnings exceeded Wall Street’s expectations.
Onsemi (ON) climbed 4% after reporting its revenue and earnings declined less than analysts had feared in the first quarter.
Paramount (PARA) rose 2.9% as merger talks between the entertainment company’s board and Skydance continued.
Alphabet (GOOGL) slid 3.4%, with investors likely taking profits after the stock skyrocketed last Friday on better-than-expected earnings.
Mastercard (MA) fell 1.2% ahead of its earnings report before the bell tomorrow.
Ford (F) slipped 0.4% after federal regulators said they were looking into two fatal crashes involving its BlueCruise self-driving feature.
The Nasdaq 100
Advanced Micro Devices (AMD) advanced 1.8% ahead of its earnings report, due after markets close on Tuesday.
Meta (META) fell 2.4%, continuing to slide after last week’s post-earnings sell-off.
Onsemi Stock Rises as Chipmaker’s Profit and Sales Top Estimates
April 29, 2024 03:34 PM EDT
Onsemi (ON) shares gained nearly 4% Monday after the provider of semiconductors for the automotive industry posted stronger-than-expected results for the first quarter, but offered soft guidance as it said it faces tough economic conditions.
Onsemi reported first-quarter diluted earnings per share (EPS) of $1.04, down from $1.28 in the year-ago period, but ahead of analyst forecasts compiled by Visible Alpha. Revenue declined 5% year-over-year to $1.86 billion, although that also was more than anticipated.
The company anticipates current-quarter revenue to be in the range of $1.68 billion and $1.78 billion, while the consensus estimate compiled by Visible Alpha was for $1.8 billion.
Despite Monday’s gains, shares of Onsemi have lost about 15% year to date.
What’s Giving Apple’s Stock a Boost?
April 29, 2024 02:51 PM EDT
Apple (AAPL) shares jumped Monday after an upgrade by Bernstein analysts, who said in a note that the company is an “essential consumer brand” whose shares have fallen too much on investor worries about weak revenue and China growth.
The analysts upgraded Apple, which reports quarterly earnings Thursday, to “Outperform” from “Market Perform.” They maintained their $195 price target on the iPhone maker. Apple shares were up 3% at $174.41 with a little more than an hour left in the session.
Bernstein said investors should “buy the fear,” noting that the recent “pullback provides an attractive entry point.”
“Be like Buffett. Despite his reputation as a long term buy and hold investor, Warren Buffett has been remarkably disciplined at adding to his Apple position when it is relatively cheap and trimming when it is relatively expensive,” Bernstein analysts wrote.
So, Musk’s Stuck With a ‘Twitter Sitter’
April 29, 2024 01:37 PM EDT
The U.S. Supreme Court on Monday declined to consider Elon Musk’s appeal of his “Twitter sitter” agreement, which the Tesla CEO said violated his right to free speech.
The decision leaves in place an agreement with the Securities and Exchange Commission that Musk has all Tesla-related social media posts reviewed by a company lawyer before they’re published.
The “Twitter sitter” arrangement stems from an August 2018 tweet in which Musk claimed to have secured funding to take Tesla private at $420 a share, sending the stock soaring. Musk called off the plans weeks later, leading the SEC to charge Musk misled investors. His “Twitter sitter” arrangement was made as part of a settlement of those charges.
Still, having his communications pre-approved hasn’t stopped Musk from moving Tesla stock with his posts. Shares tumbled more than 16% over two days in November 2021 after Musk proposed, in a Twitter poll, selling 10% of his stake.
Are Markets Underestimating Geopolitical Risk?
April 29, 2024 12:24 PM EDT
The S&P 500 fell in each of the first three weeks of April as inflation data came in higher than expected and tensions in the Middle East ratcheted up.
Geopolitics took a backseat to economic data and corporate earnings last week, “but the newsflow in the financial sphere pales into complete insignificance when compared with the tectonic shifts going on in geopolitics,” wrote Christoper Wood, global head of equity strategy at Jefferies, in a note distributed Sunday.
The firm’s base case, he wrote, “is that financial markets are utterly useless in discounting geopolitics until events become impossible to ignore.”
Markets, in Wood’s view, appear to think Middle East and the Russia-Ukraine tensions have peaked. But, with Congress’s recent passing of a $95 billion aid package for Ukraine and Israel, both conflicts will continue, raising the risks of a direct conflict between Russia and NATO and further provocations between Israel and Iran.
Escalation of either conflict could put even more pressure on global oil supply, already crimped by OPEC production cuts and Russian sanctions. That could send prices higher, accelerating a recent uptick in inflation.
By one Wells Fargo analyst’s measure, oil hitting $100 per barrel would add half a percentage point to the Consumer Price Index. Oil at $120 a barrel could raise the index a full percentage point.
Domino’s Pizza Stock Climbs on Soaring Earnings
April 29, 2024 11:34 AM EDT
Shares of Domino’s Pizza (DPZ) rose over 4% Monday morning after the pizza chain’s first-quarter results soared past estimates as its loyalty program and a deal with Uber Eats (UBER) drove sales.
The world’s biggest pizza company reported diluted earnings per share of $3.58, rising 22.2% from $2.93 in the year-ago period, with revenue increasing 5.9% year-over-year to $1.08 billion. Both exceeded the consensus estimate among analysts surveyed by Visible Alpha. Same-store sales were up 5.6%.
CEO Russell Weiner said the chain’s same-store sales got a boost from “our new and improved Domino’s Rewards loyalty program.” He added that Domino’s “went live” with marketing on Uber Eats, and that “we remain on track to exit the year at 3% or MORE of sales coming through this new channel.”
With Monday’s gains, shares of Domino’s Pizza were up more than 26% since the start of 2024.
Super Micro Computer Chart Levels To Watch Heading Into Earnings
April 29, 2024 10:49 AM EDT
Shares of server and data storage provider Super Micro Computer (SMCI) remain in focus on Monday after recovering 20% last week ahead of the company’s earnings report due after Tuesday’s close, amid expectations of quarterly sales growth driven by soaring demand for artificial intelligence (AI).
Since reaching a record high in early March, the newest S&P 500 constituent has fallen as much as 45% over the past two months as investors may have used announcements of a share offering and the company’s decision to break away from its recent pattern of disclosing its preliminary results to take some profits.
However, Super Micro Computer bulls returned from the sidelines last week to bid up the tech infrastructure company’s share price leading into earnings, halting three consecutive weeks of declines.
Taking a look at the chart, the share price broke down below a head and shoulders pattern and 50-day moving average earlier this month, indicating a potential top in the stock.
After the company’s earnings release, investors could monitor if the price can close above the pattern’s neckline around $925, a move that could lead to a retest of the all-time high of $1,229. A failure to reclaim this key chart level could spark another wave of selling down to the 200-day moving average, which currently sits at $478.90, around 44% below Friday’s closing price of $857.44.
Tesla Stock Surges After CEO Elon Musk’s Visit to China
April 29, 2024 10:04 AM EDT
Tesla (TSLA) shares jumped over 11% in early trading Monday following reports that CEO Elon Musk‘s weekend trip to China brought a number of wins for the electric vehicle maker.
Tesla reportedly cleared key data privacy hurdles and won tentative approval to deploy Tesla’s Full Self-Driving (FSD) system in China, Tesla’s second-largest market behind the U.S.
The software is a source of revenue for Tesla in the U.S., with many users paying a monthly fee for it, and expanding it to China could boost the company’s revenue and profit margins, which have taken hits in recent quarters.
Tesla is also set to expand its partnership with Chinese tech giant Baidu (BIDU) to help with mapping and navigation for Tesla’s operations in China.
Tesla shares were up 10.6% to $186 about half an hour into Monday’s session, though even at that price, they were down 25% year to date.
Stocks Making the Biggest Moves Premarket
April 29, 2024 09:25 AM EDT
Gains:
- Tesla (TSLA): Shares of the electric vehicle maker surged more than 12% amid reports CEO Elon Musk had received approval from Chinese government officials to introduce autonomous driving software in the world’s largest car market.
- Paramount Global (PARA): Shares of the entertainment company were up about 5% ahead of quarterly earnings after the bell and amid reports the company’s board could oust CEO Bob Bakish today as it engages in merger talks.
- Apple (AAPL): Shares of the tech giant climbed more than 2% after analysts at Bernstein upgraded the stock to outperform, citing the market’s overreaction to sluggish iPhone and China sales.
Losses:
- SoFi Technologies (SOFI): Shares of the financial services company fell more than 4% despite reporting better-than-expected first-quarter earnings, as lending revenue came in little changed from the year-ago period.
- Coinbase Global (COIN): The cryptocurrency exchange’s shares fell more than 1% as bitcoin continued to slide after getting a modest post-halving bump last weekend.
- Lululemon (LULU): Shares of the athletic apparel company slipped 1% after analysts at Barclays downgraded the stock to equal weight, citing decelerating growth and intensifying competition.
Stock Futures Rise to Start Busy Earnings, Fed Week
April 29, 2024 08:36 AM EDT
Futures contracts connected to the Dow Jones Industrial Average were up 0.2% in premarket trading on Monday.
S&P 500 futures climbed 0.3%.
Nasdaq 100 futures traded 0.4% higher about an hour before markets opened.
