Government Funding Deal Can’t Lift Dow
7 hr 29 min ago
Investors weren’t swayed by last-minute legislation that kept the U.S. government funded, as the Dow kicked off the fourth quarter by falling 0.2%, or 74 points, for its second consecutive session of declines.
But losses could have been worse had UnitedHealth Group (UNH), the price-weighted index’s largest component, shares not moved up 2.1%.
Microsoft (MSFT) shares jumped 1.9% to trade at more than $320 after a Wells Fargo analyst gave the company an “Overweight” rating and set a $400 price target.
Shares of Apple (AAPL) gained 1.5% after it said it would release a software update to address issues that are causing its iPhone 15 to overheat. Other tech stocks performed well, with Cisco Systems (CSCO) moving up 1.2%, Salesforce (CRM) gaining 0.5%, and IBM (IBM) rising 0.4%.
3M (MMM) shares fell nearly 3.7% to lead the index lower as investors continued to weigh concerns over the company’s liabilities over its production of per- and polyfluoroalkyl substances, commonly known as “forever chemicals,” following its idling of a Belgian plant last week.
Shares of McDonald’s (MCD) declined nearly 2.2% after California Governor Gavin Newsom signed legislation that guarantees fast-food workers a $20 minimum wage starting in 2024.
Boeing (BA) shares dropped 2%, adding to its 15% slump in September amid production defects and delays.
Goldman Sachs (GS) shares lost 1.6% and JPMorgan Chase (JPM) moved down 0.9% as the financial sector slid 0.8% in the session.
-Terry Lane
Clean Energy and Utilities Stocks Hammered by Rising Rates
8 hr 2 min ago
The utilities sector was last quarter’s worst performer, falling more than 10% over three months. And the carnage continued Monday when the Vanguard Utilities ETF (VPU) tumbled 5%.
Alongside utilities: solar stocks. The Invesco Solar ETF (TAN) fell almost 5% Monday to a 3-year low today, dragged on by major components Enphase Energy (ENPH), down 3%, and SolarEdge Technologies (SEDG), down 6%.
Despite a torrent of investment in green energy and huge government subsidies, clean energy stocks have been hit hard by rising interest rates. As have utilities, a massively expensive business made even more expensive by high inflation and rising interest rates, which increase borrowing costs for a capital-intensive industry.
Chinese EV Sales Surged in September, Underscoring a Thriving Market
9 hr 8 min ago
Prominent Chinese EV makers such as XPeng (XPEV), Nio (NIO), and Li Auto (LI) reported surging EV sales last month.
Chinese EV Deliveries:
- XPeng: 15,310, up 81% year-over-year.
- Nio: 15,641, up 44% year-over-year.
- Li Auto: 36,000, up 212% year-over-year.
Plug-in electric vehicles accounted for almost 40% of Chinese auto sales last month, while fully electric ones accounted for just over a quarter. In a sign of the market’s continued strength, China accounted for a stunning 60% of global plug-in EV registrations last month.
However, challenges have emerged to China’s EV dominance. European Union (EU) regulators last month launched a probe into state subsidies for Chinese EV makers, in an effort to protect domestic carmakers like Volkswagen (VOW), Mercedes-Benz (MBG), Renault (RNO), and Stellantis (STLA)-owned brands like Opel, Alfa Romeo, and Fiat.
American depositary receipts (ADRs) of XPeng and Li Auto have surged 80% and 70%, respectively, so far this year, while those of Nio are down more than 6%.
-Mack Wilowski
TradingView
Midday Market Movers
10 hr 16 min ago
Sphere Entertainment Co. (SPHR): Shares of the live entertainment company jumped 15% after the opening of its $2.3 billion Las Vegas venue, The Sphere. Video of its inaugural U2 concert, set against an immersive 160,000 square foot LED screen, went viral over the weekend.
Liberty Media Corp – Series A Formula One (FWONA): Shares of Liberty Media subsidiary Formula One Group gained 9% on reports Apple (AAPL) is considering bidding $2 billion for global broadcasting rights, in its latest foray into sports broadcasting.
Discover Financial Services (DFS): The online bank’s shares rose more than 5% after it reached an agreement with the Federal Deposit Insurance Corporation (FDIC) to improve its consumer compliance and oversight practices. The company will not pay a fine for the issues found in the FDIC’s investigation.
ZScaler Inc. (ZS): Shares of the cloud-based security provider gained more than 3% after it was upgraded by Piper Sandler to overweight from neutral, saying the company will benefit from more widespread adoption of network security solutions.
Kellogg Co. (K): Shares of the cereal and packaged food company, now known as Kellanova, fell nearly 7% after it completed the spin-off of its cereal brands, now trading under the name WK Kellogg Co. (KLG).
Danaher Corp. (DHR): Shares of the health tech company fell 4% after it spun off its environmental and applied solutions segment to operate as a separate company under the name Veralto (VLTO).
Benchmark Yield Tops 4.7% for First Time Since 2007
11 hr 8 min ago
The yield on 10-year Treasury notes rose above 4.7%, its highest since October 2007, on Monday as markets continued to recalibrate in light of the Fed’s insistence rates will stay higher for longer.
Meanwhile, the 30-year bond yield climbed above 4.8%, a level briefly touched last week before Thursday and Friday’s retreat.
The 2-year yield—often the rate against which the 10-year yield is compared to determine the yield curve—rose more modestly to 5.125%. The yield curve has been gradually flattening since July when the 2-year yielded one percentage point more than the 10-year, a level of inversion not seen since the early 1980s.
The difference between the 2- and 10-year yields stood at just 0.44% at Friday’s close, its lowest since May.
Coinbase Shares Rise After Obtaining Key Regulatory Approval in Singapore
11 hr 38 min ago
Coinbase Global (COIN) shares gained after the largest U.S. cryptocurrency exchange received a Major Payment Institution (MPI) license from the Monetary Authority of Singapore.
Coinbase indicated the decision will enable it to expand its Digital Payment Token services to both individuals and institutions in Singapore, and noted that since its initial involvement there, it identified Singapore as a “vital market for Coinbase.”
Shares of Coinbase were 0.6% higher as of noon after giving up some of their earlier gains. They have more than doubled in value this year.
-Bill McColl
Ether Joins Bitcoin on Traditional Exchanges
12 hr 37 min ago
America’s first ether ETFs begin trading today, with ProShares launching the Ether Strategy ETF (EETH) and two other bitcoin-ether funds on the New York Stock Exchange and VanEck listing its Ethereum Strategy ETF (EFUT) on Cboe.
Each of the new ETFs tracks the performance of ether futures, not the price of ether itself. The Securities and Exchange Commission (SEC) has yet to approve cryptocurrency spot funds despite mounting pressure from investors and lawmakers.
The first bitcoin futures ETF, the ProShares Bitcoin Strategy ETF (BITO), began trading nearly two years ago, and the crypto world has been pushing for a spot ETF ever since.
Major ETF providers, initially skeptical of crypto ETFs, have piled in as of late. BlackRock, Fidelity, and Invesco all applied earlier this year to launch their own bitcoin spot ETFs. The SEC last week delayed a decision on those applications.
Markets as Unimpressed by One EV Producer’s Beat as Another’s Miss
13 hr 25 min ago
Investors have high expectations for electric vehicle makers—so high that meeting those expectations isn’t enough sometimes.
Rivian shares fell as much as 3% in early trading Monday after reporting an uptick in production and deliveries last quarter, putting it squarely on track to meet its goals of producing 52,000 vehicles this year.
Rivian Production and Deliveries:
- Q3 Production: 16,304 vs. 13,992 in Q2
- Q3 Deliveries: 15,564 vs. 12,640 in Q2
- YTD Production: 39,691 vs. goal of 52,000
Tesla, meanwhile, disappointed investors with its third-quarter production and deliveries. The company warned on its most recent earnings call that production would decline in the third quarter amid “planned downtimes for factory upgrades.” Deliveries still came in below analysts’ moderated expectations.
Tesla Production and Deliveries:
- Q3 Production: 430,488 vs. 479,700 in Q2
- Q3 Deliveries: 435,059 vs. 466,140 in Q2
- YTD Production: 1,350,996 vs. goal of 1.8 million
Both stocks were trading 0.5% lower an hour into the session.
Stocks Making the Biggest Moves Premarket
14 hr 33 min ago
Gains:
- Crypto stocks: Shares of crypto exchange Coinbase Global (COIN), as well as Bitcoin miners Marathon Digital Holdings (MARA) and Riot Platforms Inc. (RIOT), were buoyed by surging cryptocurrency prices Monday morning. The price of Bitcoin jumped nearly $1,000 late Sunday, possibly the result of a short squeeze. Prices may also be boosted by the debut of Ether futures ETFs from ProShares, VanEck, and others today.
- Datadog Inc. (DDOG): The software company’s shares gained 2.5% after analysts at Piper Sandler upgraded the stock to overweight from neutral, citing stabilizing demand for IT infrastructure and software.
- Nvidia Corp. (NVDA): Shares of the graphics processing unit maker rose 1% after the European Union denied the existence of an official probe into anticompetitive practices in the GPU market. Reports of an investigation came after French authorities raided Nvidia offices last week.
Losses:
- Rivian Automotive Inc. (RIVN): Shares of the electric truck maker fell more than 4% after it said it produced 16,304 vehicles and delivered 15,564 last quarter, about in line with the company’s guidance.
- Tesla Inc. (TSLA): Shares fell more than 3% after the EV maker said it reported an expected sequential decline in production last quarter. The company produced about 430,500 vehicles in Q3, down from 479,700 in Q2.
- Toast Inc. (TOST): Shares of the restaurant payments tech company fell 3% after Mizuho Securities downgraded the stock to neutral from buy, citing signs of sluggish growth and headwinds from the resumption of student loan payments this month.
5 Things to Know Before Markets Open
15 hr 4 min ago
Here’s what investors need to know to start their day:
- The United Auto Workers (UAW) reached an agreement with Volvo Group-owned Mack Trucks that would increase wages and extend benefits to the automaker’s nearly 4,000 U.S. workers after the union authorized a strike.
- Apple (AAPL) shares ticked down by 0.1% in premarket trading after the company said it would release an iOS 17 software update to improve problems with its iPhone 15 overheating. The company said the new model’s titanium case was not responsible for heating problems.
- Shares of Tesla (TSLA) moved higher by 0.5% in the premarket ahead of its report on third-quarter unit sales today.
- AMC Entertainment (AMC) shares rose 1.1% in the premarket after reports that the makers of a concert film based on Beyonce’s Renaissance World Tour were in talks to bring the film to the movie theater chain’s screens.
- The ISM manufacturing index is projected to increase to a reading of 48 in September, up from 47.6 in the prior month, when that data is released at 10 a.m. ET.
-Terry Lane
Stock Futures Slipping to Start the Week
15 hr 26 min ago
Futures contracts connected to the Dow Jones Industrial Average were 0.25% lower in premarket trading Monday.
S&P 500 futures contracts were down 0.2%.
Nasdaq 100 futures fell less than 0.1%.
