Dow Jones Surges: S&P 500 & Nasdaq Update

Noteworthy S&P 500 Movers on Tuesday

6 hr 58 min ago

Advancers

• Viatris (VTRS) presented its strategic growth initiatives at the UBS Global Healthcare Conference Tuesday, and shares of the pharmaceutical company jumped 10%, the most of any S&P 500 stock. The company projected 2% to 3% operational revenue growth excluding issues related to a facility in India. Viatris also said it expects new product launches to generate significant revenue and intends to return more than $1 billion to shareholders.
• Paramount Skydance (PSKY) shares surged 9.8% after the entertainment giant released its first quarterly earnings report since the August completion of the merger between Paramount Global and Skydance Media. The firm outlined major cost-reduction plans, including job cuts tied to asset sales in Argentina and Chile, and lifted its cost-savings target. Paramount Skydance also increased its outlook for merger savings, highlighted ambitious investments in its studio and streaming business, and said it would hike streaming prices.
• Package delivery giant FedEx (FDX) jumped 5.5% after CFO John Dietrich provided a forecast for fiscal second-quarter earnings per share that exceeded consensus estimates. The upbeat outlook for the critical holiday quarter came as the shipper and its peer United Parcel Service (UPS) navigated challenges related to the grounding of their fleets of McDonnell Douglas MD-11 cargo aircraft following a devastating crash last week. UPS rose 2.1% today.

Decliners

• AppLovin (APP) shares tumbled 8.7%, posting the steepest daily decline in the benchmark index. Although the mobile advertising technology company topped sales and profit estimates in its latest quarterly report, released Nov. 5, reports of an SEC investigation into AppLovin’s data-collection practices b have weighed on the stock. AppLovin stock has gained around 85% year-to-date, boosted by optimism surrounding its AI-powered Axon platform.
• Japanese holding company SoftBank (SFTBY) said that it sold its stake in AI chip behemoth Nvidia (NVDA). SoftBank stressed that it was not abandoning AI, noting that proceeds from the asset sale would help fund its investments in ChatGPT owner OpenAI. Still, the move weighed on semiconductor stocks: Nvidia sank about 3%, while the PHLX index of chip shares fell 2.5%.
• The uncertainty surrounding the AI boom extended beyond the semiconductor industry into other areas exposed to the technology. Shares of nuclear-focused energy generator View (VST), which has drawn attention for its opportunity to power AI data centers, dropped 4.8% Tuesday. In its third-quarter earnings report, released last week, Vistra posted lower-than-expected revenue and a year-over-year decline in net income.

–Michael Bromberg

Tech Is The Only Sector in the Red Today

8 hr 41 min ago

Technology stocks powered Monday’s big gains but have come under pressure on Tuesday.

The tech sector declines aren’t enough to keep the S&P 500 from rising today, however, as the other ten sectors that comprise the index are all gaining ground.

The S&P 500 health sector was up about 2% in late trading Tuesday, while the energy, consumer staples and real estate sectors each tacked on more than 1%.

The information technology sector was down 0.5%, led by a 7% decline for shares of ad tech company Applovin (APP). Chip stocks Micron (IN) and Lam Research (LRCX) each dropped about 4%.

Softbank Sells Entire Stake in Nvidia

11 hr 19 min ago

SoftBank is out of Nvidia stock—but not the AI trade.

The Japanese company in a Tuesday statement said it sold 32.1 million shares of chip giant Nvidia (NVDA), a “complete sale,” in October, raising $5.83 billion. That comes to an average price of just under $182, below Monday’s $199.05 per share close. (It also reported $9.17 billion in proceeds on sales of T-Mobile (TMUS) between June and September.)

Nvidia’s shares hit their latest record high of $212 in late October, but investors more recently have shown signs of wariness about valuations and the health of the AI trade. That’s shown up in today’s action, too; Nvidia’s stock was down more than 3% in midday trading, more than broader markets.

But SoftBank isn’t pulling back from AI investments. It put billions of dollars into OpenAI earlier this year, making the ChatGPT owner the world’s most-valuable startup, and that appears to be behind some of the company’s latest investment moves; The company last month committed more than $22 billion in additional funding to OpenAI.

“We are making large investments in OpenAI,” The Wall Street Journal quoted SoftBank CFO Yoshimitsu Goto as saying today. “To do that, we have to use some of our existing assets to raise funds.”

Investors trying to connect the dots these days don’t have an easy job. Concerns about AI-stock valuations have weighed on shares lately, with some analysts suggesting shorting the hyperscalers whose spending has driven business and share prices this year. The word “bubble” has been in pretty heavy use in recent weeks.

But elsewhere in the trade, investors continue to look for opportunities to push some shares in the food chain higher. Yesterday, for exampleit was memory and data-storage stocks. And interest in the big names has hardly dried up; Nvidia, for example, was held by more than three-quarters of active fund managers in October, according to a Bank of America analysis.

–David Marino-Nachison

Tesla Stock Slips Following Chinese Sales Numbers

12 hr 46 min ago

Various news services overnight reported that Tesla’s (TSLA) October auto sales in China fell to their lowest level in three years, about 26,000, citing the China Passenger Car Association. The reports indicated sliding market share in China, though also rising shipments of Teslas made in China to other markets.

That’s weighing on Tesla’s shares, which were recently down more than 2%. Investor attention has been largely elsewhere recently: The shares jumped yesterday alongside U.S. stocks, lifted by optimism about a possible end to the government shutdown, and late last week they retreated in part on a sell-the-news reaction to a shareholder vote approving a big new pay package for CEO Elon Musk.

The vote removed a possible overhang—will Musk stick around for the next phase of Tesla’s growth or won’t he?—and formalized the company’s commitment to a set of targets upon which the CEO’s payout hinges. Several of them signal Tesla’s commitment to evolution into a business powered by robotaxis and robots.

But car sales remain important. For one, they still make up the lion’s share of Tesla’s revenue. And one of the targets requires the company to deliver a total of 20 million vehicles; another requires 10 million active subscriptions to Tesla’s self-driving software, which can’t happen without vehicle sales.

On a quarter-to-quarter basis, investors still care about the “old-school” Tesla business. Deliveries in the latest quarter came in higher than expectedthough the expiration of U.S. subsidies likely pulled forward demand for it and other automakers.

–David Marino-Nachison

AMD Expected to Lay Out AI Roadmap Today

14 hr 41 min ago

Traders will be on the lookout for updated financial targets from Advanced Micro Devices as it hosts an investor day later today.

AMD’s (AMD) shares climbed more than 4% Monday ahead of the event, which some analysts have suggested could be a positive catalyst for the chipmaker’s stock. The stock, which has doubled since the start of the year, was down about 1% in recent premarket trading.

Analysts at Bank of America, Citi, and Jefferies said they’ll be watching for an updated outlook and financial targets from AMD’s analyst day event. CEO Lisa Su is widely expected offer more details on the company’s artificial intelligence roadmap. (You can watch the stream, scheduled for 1 p.m. ET, here.)

A bigger estimate of AMD’s total addressable market, thanks to booming AI demand, might help boost confidence in the stock, the analysts said, following a strong run this year driven lately by a string of big AI dealsincluding one with ChatGPT maker OpenAI.

Last week, AMD posted record quarterly results and an upbeat outlook on surging demand for its data center chips, though the stock was little changed following the results amid some worries about an AI bubble.

Heading into the event, Wall Street analysts lean more bullish on the stock, with seven of the 10 with current ratings compiled by Visible Alpha calling it a “buy,” compared to three neutral ratings. Their mean target around $269 would suggest nearly 10% upside from Monday’s close.

–Kara Greenberg

Major Stock Index Futures Down Slightly

16 hr 26 min ago

Futures tied to the S&P 500 were down 0.2%.

Nasdaq 100 futures fell 0.4%.

Dow Jones Industrial Average futures rose fractionally.