Equity Indexes Wrap: Nvidia Rally Powers Dow, S&P 500 to Records
February 22, 2024 04:30 PM EST
The Dow
Tech stocks soared on Nvidia’s earnings, with Salesforce (CRM), up 3.6%, leading the index. International Business Machines (IBM) rose 2.5% and Microsoft (MSFT) added 2.4%.
Intel (INTC) missed out on the chip rally; its shares shed 1.1%.
Verizon (VZ) fell 0.9% amid a widespread service outage that affected thousands of customers.
The S&P 500
Nvidia (NVDA) surged 16.4%, adding a record $270 billion in market cap, after handily beating fourth-quarter earnings estimates.
Moderna (MRNA) jumped 13.5% after reporting a surprise profit as it increased its share of the U.S. Covid-19 vaccine market.
Royal Caribbean Group (RCL) rose 6.7% after the cruise operator raised its full-year guidance, citing strong holiday bookings. Competitor Carnival Corp (CCL) gained 3.4%, while travel stocks Booking Holdings (BKNG) and Airbnb (ABNB) advanced 4.3% and 4%, respectively.
Big tech rode the AI wave higher, with Meta (META) gaining 3.9% and Amazon (AMZN) adding 3.6%.
Etsy (ETSY) tumbled 8.4% after missing earnings estimates despite posting better-than-expected sales in the fourth quarter.
Newmont (NEM) slid 7.6% after the world’s largest gold miner said it would sell assets and cut its dividend as it refocuses following its acquisition of Newcrest.
AT&T (T) slipped 2.4% amid Thursday’s service outage.
The Nasdaq 100
Advanced Micro Devices (AMD), a fierce Nvidia competitor, rose 10.7% on a wave of AI enthusiasm.
Synopsys (SNPS) rose 6.9% to a record high after its earnings topped forecasts, which it also credited with a boom in AI demand.
Semiconductor stocks popped following Nvidia’s earnings. Broadcom (AVGO) climbed 6.3%, while chip fabrication equipment makers Applied Materials (AMAT) and ASML Holding (ASML) added 4.9% and 4.8%, respectively.
DoorDash (DASH) gained 5.9% following an upgrade to “overweight” by analysts at Morgan Stanley.
Keurig Dr. Pepper (KDP) dropped 3.9% after topping Wall Street’s estimates with its fourth-quarter earnings but coming up short on revenue.
Synopsys Stock Soars To a Record High as AI Boom Drives Bullish Outlook, Earnings Beat
February 22, 2024 03:45 PM EST
Synopsys Inc. (SNPS) shares surged to an all-time high Thursday, after the software firm posted better-than-expected first-quarter results and guidance on the back of the boom in demand for artificial intelligence (AI) products.
The maker of chip-design software reported adjusted earnings per share (EPS) of $3.56 after the bell Wednesday, beating analysts’ forecasts.
Quarterly revenue in its fiscal first quarter, which ended January, rose to $1.65 billion, up about 21% year over year.
The Sunnyvale, Calif.-based company projected adjusted earnings per share for the current quarter ranging between $3.09 and $3.14.
Synopsys makes software that engineers use to design and test silicon chips, with its customers including chipmakers Nvidia (NVDA) and Intel (INTC).
Synopsys shares were up 7% at $582 shortly before the close on Thursday. They are more than 60% higher in the past year.
Nvidia Poised to Post Largest Market Value Gain in History
February 22, 2024 03:10 PM EST
Nvidia (NVDA) was on track to record the largest-ever one-day jump in market capitalization on Thursday after it blew past analysts’ earnings estimates for a fourth-consecutive quarter amid a boom in demand for artificial intelligence.
Nvidia rose 15% Thursday afternoon, adding more than $250 billion to its market capitalization. That blows out of the water the prior record set just two weeks ago by Meta (META), which added $205 billion in market cap after it beat earnings forecasts and announced its first dividend.
Before Meta, no company had added more than $200 billion in market cap in a single session, but Apple and Amazon had come close. They each gained slightly more than $190 billion on separate days in 2022.
To put Nvidia’s gains Thursday into perspective:
- Only 28 companies in the S&P 500 (excluding Nvidia) have market caps of more than $250 billion. The smallest of those is Netflix (NFLX), worth about $254 billion.
- $250 billion is more than half the assets under management of the SPDR S&P 500 ETF Trust (SPY), one of the world’s largest, most widely traded ETFs.
- Goldman Sachs (GS) and Boeing (BA) have a combined market value of about $250 billion.
- The Big Three U.S. automakers—Stellantis (STLA), Ford (F), and General Motors (GM)—have a combined market cap of $176 billion.
- The world’s four most valuable non-luxury footwear makers—Nike (NIKE), Adidas (ADDYY), Anta Sports (ANPDF), and Deckers (DECK)—are worth a combined $244 billion.
- Thursday’s increase put Nvidia’s market cap above $1.9 trillion, more than the GDP of all but 11 national economies in 2022—between Brazil ($1.92 trillion) and Australia ($1.69 trillion).
Moderna Takes a Bigger Share of US COVID-19 Vaccine Market and Stock Jumps
February 22, 2024 02:00 PM EST
Moderna (MRNA) grabbed a larger percentage of the COVID-19 vaccine market in the U.S. in the fourth quarter, and that helped the biotech firm post a surprise profit. Shares surged in intraday trading Thursday following the news.
The company reported that it captured a 48% share of U.S. COVID-19 sales during the fall season, up from 37% a year earlier.
Even so, global revenue from the vaccine slumped 43% to $2.8 billion, which it said was driven by lower volume as demand waned. The company pointed out that the total was boosted by $600 million in deferred revenue.
Moderna reported earnings per share of $0.55, while analysts had anticipated a loss. The company said that it was seeing the impact of cost-cutting measures it began to take in the third quarter.
The company reiterated its full-year revenue guidance of $4 billion, noting that it is anticipating gains from its experimental Respiratory Syncytial Virus (RSV) vaccine, which it expects will get U.S. regulatory approval by May 12.
Moderna shares were up 15.8% to $101.32 Thursday afternoon. Despite Thursday’s rise, shares of Moderna have lost over one-third of their value over the past year.
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Midday Movers: Nvidia, Moderna, Etsy
February 22, 2024 12:55 PM EST
Nvidia (NVDA) led gains on the S&P 500 with shares up close to 15% after the artificial intelligence (AI) chipmaker reported a five-fold jump in AI and cloud revenue.
Booming demand for AI products and services sent shares of semiconductor software tools maker Synopsys (SNPS) to an all-time high.
Moderna (MRNA) shares also jumped as the biotech firm reported a surprise profit and its share of the U.S. COVID-19 vaccine market rose.
Newmont (NEM) shares slid as the world’s biggest gold miner said it would cut jobs and sell off six non-core assets to reduce debt following its purchase of Australian rival Newcrest.
Shares of Etsy (ETSY) tumbled after the e-commerce company warned that current quarter gross merchandise sales are expected to decline.
Keurig Dr. Pepper (KDP) shares sank as consumers balked at paying higher prices for its beverages, hurting revenue.
What You Need To Know Ahead of Berkshire Hathaway’s Earnings on Saturday
February 22, 2024 12:10 PM EST
Berkshire Hathaway Inc. (BRK.A, BRK.B) will report fourth-quarter and full-year 2023 earnings on Feb. 24, 2024. This will be Berkshire’s first earnings report since the passing of Vice Chair Charlie Munger in November.
The Oracle of Omaha led his company to post profits in the first two quarters of 2023, but it swung to a loss for the three months ending last October.
While there is no way to predict how different Berkshire’s earnings will look this year, the S&P 500 did gain over 24% last year versus a near 20% decline in 2022, when Berkshire reported a $22.8 billion loss after accounting for $53.6 billion in investment and derivative losses.
Another key metric that investors will be watching is Berkshire’s cash pile. Rising Treasury yields boosted the company’s cash hoard to a record $157.2 billion in the third quarter.
Investors will also be looking to Buffett for commentary about the company’s acquisitions, share buybacks by listed companies, or even federal taxes.
See here for more on Berkshire’s upcoming earnings report.
Rivian Stock Skids After EV Maker Delivers Weak Production Guidance
February 22, 2024 10:58 AM EST
Rivian Automotive (RIVN) posted a wider-than-expected quarterly loss and provided 2024 production guidance that fell substantially below analysts’ expectations, sending the electric carmaker’s stock sliding more than 25% Thursday morning.
The company behind the all-purpose S1 SUV and 5-seat R1T truck disclosed a fourth-quarter per-share loss of $1.58, wider than the $1.35 a share loss Wall Street had expected. Sales for the period of $1.3 billion matched the consensus view.
Looking ahead, Rivian set its 2024 production guidance at 57,000 vehicles, considerably below the 81,700 units analysts had forecast and less than the 57,232 vehicles it produced last year. Typically, production volume and sales closely correlate in the auto industry, meaning investors pay close attention to this important metric.
In recent weeks, Rivian’s share price has managed to remain above key support near a horizontal line positioned around $15.20. On Thursday, monitor the stock’s record low at $11.68 set in April last year as a potential support area. A reversal candlestick formation at this level, such as a bullish engulfing pattern, could indicate that the stock has possibly bottomed.
Semiconductor Stocks Rebound from Three Day Slump on Nvidia Earnings
February 22, 2024 09:59 AM EST
The iShares Semiconductor ETF (SOXX) jumped 4% to an all-time high of more than $639 in early trading after a blowout quarterly earnings report from Nvidia sent investors running to the artificial intelligence shovel store.
Nvidia (NVDA) reported revenue of $22.1 billion, a 265% increase from a year ago and more than $1 billion more than analysts had forecast. Net income of $12.29 billion, or $4.93 per share, was also more than $1 billion higher than Wall Street’s consensus estimate and represented a more than eight-fold increase from the year-ago quarter. Shares soared more than 12% to a record-high Thursday morning.
And it wasn’t the only semiconductor stock to benefit. Advanced Micro Devices (AMD), one of Nvidia’s fiercest competitors in the race to dominate AI, soared more than 6%. Broadcom (AVGO), one of the world’s largest chipmakers, advanced more than 5%. AMSL Holdings (ASML) and Applied Materials (AMAT), which make the equipment required to manufacture the world’s most sophisticated semiconductors, both gained more than 4%.
Stocks Making the Biggest Moves Premarket
February 22, 2024 08:57 AM EST
Gains:
- Nvidia Corp. (NVDA): Shares of the AI chip leader soared more than 12% in premarket trading, putting them on track to open at a record after handily beating high expectations with its fourth-quarter earnings.
- Moderna Inc. (MRNA): Shares rose more than 6% after the vaccine maker posted a surprise profit in the fourth quarter despite slumping Covid-19 sales.
- DoorDash Inc. (DASH): Shares of the food delivery company rose more than 5% after analysts at Morgan Stanley upgraded it to overweight, citing its attractive valuation and growth potential.
Losses:
- Rivian Automotive Inc. (RIVN): Shares of the electric truck maker tumbled more than 18% after reporting a wider-than-expected loss in the fourth quarter. It also forecast it would produce 57,000 vehicles this year, well below Wall Street’s expectations.
- Etsy Inc. (ETSY): Shares of the e-commerce platform fell 5% after its earnings fell short of analyst estimates despite reporting better-than-expected sales.
- AT&T Inc. (T): Shares of the telecom slipped more than 1% amid reports of a widespread outage affecting thousands of customers.
Stock Futures Soar Following Nvidia Earnings Beat
February 22, 2024 08:34 AM EST
Futures contracts connected to the Dow Jones Industrial Average ticked up 0.4% in premarket trading on Thursday.
S&P 500 futures were up 1.3%.
Nasdaq 100 futures jumped more than 2% about an hour before markets opened.
