Growth and chip shares rose on Tuesday, driving the US’s four main indexes higher, while carmaker General Motors and online music company Spotify soared on solid earnings reports, reports the latest stock news.
Homegrown tech shares, such as Facebook and Microsoft, are expected to report quarterly results this week, along with a number of other big tech names during the rest of the week.
Shares of megacap growth stocks rose between 1.4% and 2.6% Monday in the last trading day ahead of earnings season, with Meta Platforms, Microsoft, and Alphabet reporting this week.
Tesla will kick off the quarterly earnings cycle after the market close Tuesday.
Latest stock news: NVIDIA soars
Chip stocks also rose in a synchronized fashion, pushing equities higher still.
Nvidia, Micron Technology and Advanced Micro Devices shares all rose between 2.5% and 3.3% according to the latest stock news.
Shares in General Motors held up by 4.6% after the US automaker not only beat Wall Street’s quarterly targets but also raised its annual outlook.
Latest stock news: Spotify shares jump
Spotify’s shares jumped 14.1% after the Swedish music streaming company said its quarterly gross profit topped 1 billion euros for the first time, according to the latest stock news.
Further gains came in GE Aerospace, up 6.2% after boosting its full-year profit forecast; and Danaher, up 7% after reporting a strong quarterly profit and sales result in line with the latest stock news.
Meanwhile, JetBlue’s shares dropped 17.2% as the airline lowered its annual revenue forecast after reporting a small increase in first-quarter revenue.
Against this backdrop of corporate developments, US business activity data showed a slowdown in April, falling to a four-month low due to dampened demand, with inflation pressures however easing a bit further, adding another facet to the latest stock news story.
A sell-off in US stocks last week in reaction to geopolitical worries and Fed rate-cut expectations has mined the market for news and, with the release of the US Personal Consumption Expenditures (PCE) index due out Friday, traders are standing on tiptoes.
At noon, the Dow Jones Industrial Average rose 226.15 points, or 0.59%, the S&P 500 advanced 53.38 points, or 1.07%, and the Nasdaq Composite advanced 221.35 points, or 1.43%.
Communication services had led the way, rising 1.7%t, in the latest stock market news.
Meanwhile, in a significant development in the latest stock news, Hibbett’s stock rose 19.1% after JD Sports Fashion said it would buy the US athletic fashion retailer for about A$1.08 billion, or around £568 million.
The latest stock news showed an exuberant market as advancers led decliners at the major exchanges, with the Street deemed to be on the positive side.
Global shares climbed Tuesday as Wall Street rebounded, with investors keeping an eye on the latest stock news from megacap US earnings while the yen dropped to fresh multi-year lows against the dollar and the euro.MSCI’s all-country world index gained 1.05% by mid-morning to creep away from a two-month low, the latest stock news reported.
In the latest stock news, the Dow Jones Industrial Average gained 211.11 points or 0.55%, to 38,451.09; the S&P 500 increased 49.36 points or 0.99%, to 5,059.96; and the Nasdaq Composite gained 206.95 points or 1.34%, to 15,658.26.
At the same time, the FTSE 100 retreated slightly from a record high, and the STOXX 600 rose 1% as gains in tech shares were a focus in the latest stock news.
That upbeat assessment was echoed by surveys of business activity.
Germany had returned to growth in early April, after five months of contraction, and the broader euro zone was expanding at the fastest clip in nearly a year.
The Middle East crisis is still there, but it’s no longer front and centre.
That’s why stock news reports are getting back to the business of earnings.
Spot gold slipped 0.41% to $2,316.64 an ounce, extending the previous day’s drop, as the latest stock news saw traders become a bit more positive on risk appetite.
The dollar retreated from recent peaks but remained buoyed by investor expectations that the Federal Reserve isn’t under any pressure to cut interest rates in the US any time soon, after yields on Treasuries rose to their highest since November.
The ‘big techs’ in US stocks outshone the broader market, while further bumper earnings results this week are among the latest stock news under the spotlight.
Following UBS’s further downgrade of US mega-caps, with market strategists cutting their forecast for profits of the Big Six tech stocks ‘by nearly two premature thirds’ to predict ‘a collapse in profit growth momentum’ over the next two quarters, US business activity, economic growth and inflation metrics are front and centre this week as traders slash bets on Federal Reserve rate cuts.
On the bond side, yields on the US 10-year note and 30-year bond both dipped slightly, as did the two-year note yield, the one most closely tied to rate expectations.
In Europe, the ECB is widely expected to cut rates in June, exerting pressure on the single currency, which edged up against the dollar.
Meanwhile, the yen continued its dive, hitting a 34-year low, with Japan’s finance minister hinting at intervention to support its currency.
In the commodities arena, oil futures edged higher, as the market weighed the latest developments in the Middle East, as U.S. crude and Brent futures rallied on the day, concluding today’s global market wrap and breaking down the latest stock news.
Tesla’s (TSLA.O) stock edged up 2.3% on Tuesday, rising to $145.34 in volatile early trading, as the carmaker prepared to release its first-quarter results, the centrepiece of the latest stock news.
The electric carmaker is expected to record its lowest gross profit margin since early 2016, reflecting the effects of price cuts and slower demand, according to analysts.
CEO Elon Musk has promised a plenteous buffet for investors when he fields questions in the post-results conference call today about the state of what has been coyly dubbed the Model 2.
Though initially teased last January by the Tesla boss to arrive by 2025, the car’s name twice disappeared from Tesla.com recently, following a reportedly explosive meeting at the company on 13 May in which Tesla’s engineers were told to scrap the car and concentrate on the development of a self-driving robotaxi on the same underpinnings.
To these, the latest bulletins of stock exchange news were added, including news that Musk’s meeting with India’s Prime Minister Narendra Modi to discuss possible major investments in an auto factory had been cancelled because of ‘very heavy Tesla obligations’ (a meeting that was predicted to centre on the production of a small, cheap model).
Tesla’s results for the first quarter will show the pressure of slowing growth in sales, seen in its warning earlier this month of an 8.5% fall in deliveries and rising inventories.
Tesla announced more global price cuts to the Model 3, Model Y and other models over the weekend, as fears of extra margin pressure mount.
Following a deluge of negative news about Tesla in the stock market, several analysts are now predicting that the company’s annual deliveries will drop for the first time in 2024, after years of steep annual growth.
The company has warned that its delivery growth this year will be ‘notably lower’ and that a recent round of price cuts might not be enough to boost demand.
Tesla’s stock has dropped more than 43% this year, placing it among the worst performers on the S&P 500 stock index, according to the most recent stock market news.
Wall Street analysts polled by Visible Alpha project that Tesla’s automotive gross margin without regulatory credits (which have artificially inflated its reported adjusted gross margins) will decrease to 15.2%, down from 19% a year earlier, and the lowest margin since the fourth quarter of 2017.
Yields are also forecast to decline for the March quarter by 5.05%, to $22.15 billion, according to LSEG data. Musk’s assurances of fully autonomous vehicles are also ‘engineering and regulatory nightmares’ and remain years away.
Musk still generates headlines through tweets; in June he said that a ‘Robotaxi unveil’ was set for ‘8/8’, presumably August 2024, and said that conquering autonomy lay in ‘the most obvious strategy’ – all fuel for the latest Tesla stock news tropes.
Global equity market-neutral hedge funds have recently seen significant inflows of capital, as they promise higher returns than plain-vanilla stock markets when facing global rate uncertainty and geopolitical turmoil, according to current stock market news.
Why It Matters
Equity market-neutral hedge funds (EMN) exchange overvalued stocks for undervalued ones, aiming to take advantage of discrepancies in stock valuation that open up as a result.
Because they remove themselves from movements in the broader market indexes, they are considered to have a low beta. Uncertainty in the market, analysts say, can often create mispricings in stocks, and these funds are ideally placed to take advantage in the event of a significant bout of volatility, as this latest stock news report points out.
More significantly, these funds are seen as a safe haven from market volatility arising from the US Presidential elections, changes to world interest rates policies or fears of a recession.
That’s what makes them the centre of the latest stock news and the darling of new investors who want to park their money in something secure.
What the Numbers Say
In the latest stock news, new figures from HFR reveal that, in the first quarter of this year, global equity market-neutral hedge funds made a 4.1% return, the highest quarterly gain since 1995 and the latest stock news for investors.
In the same period, investors poured $942.8 million into these funds, in contrast with the $95.9 million outflow of the previous quarter, which is the latest stock news on investors.
