The Dow Jones Industrial closed up on Thursday, as financial stocks and strong jobs data prompted investors to delay estimates of when interest-rate cuts could begin.
Market Snapshot
The S&P 500 lost 16.13 points, or 0.34%, to end at 4,688.68 points, while the Nasdaq Composite lost 81.91 points, or 0.56%, to 14,509.39. The Dow Jones Industrial Average rose 10.15 points, or 0.03%, to 37,440.34.
Market Movers
Walgreens Boots Alliance dropped 5.1% after the drugstore chain reported fiscal first-quarter adjusted earnings that beat analysts’ estimates but slashed its quarterly dividend by 48%.
Mobileye Global plummeted 25% after the maker of self-driving technology said it expects fiscal first-quarter revenue to fall about 50% from revenue of $458 million a year earlier. Mobileye said in a statement that it has “become aware of excess inventory at our customers.”
Intel dipped 0.4%. It owns a stake of 88% in Mobileye. The stock had traded higher earlier after it named Justin Hotard as executive vice president and general manager of its data-center and artificial-intelligence group, effective Feb. 1. The chip maker said in a press release that Hotard will “play an integral role in driving the company’s mission to bring AI everywhere.” Hotard previously served as executive vice president and general manager of High-Performance Computing, AI and Labs at Hewlett Packard Enterprise.
Apple fell 1.2% after the tech giant received another downgrade from Wall Street. Analysts at Piper Sandler downgraded the stock to Neutral from Overweight and reduced their price target to $205 from $220. The analysts cited “valuation concerns and broader handset and macro weakness” in the first half of 2024. Apple was downgraded earlier in the week by Barclays to Underweight from Equal Weight.
APA Corp. reached an agreement to acquire Callon Petroleum in an all-stock deal valued at about $4.5 billion, including debt. Callon shares rose 2.9% to $34.62, while APA declined 7.4%.
Peloton Interactive rose 14% after forming an exclusive partnership with TikTok to create a workout hub on the short-form video hosting service.
Dyne Therapeutics, the clinical stage muscle disease company, said it has begun an underwritten public offering of $175 million of common shares. The stock surged 31%. The shares rose 13% on Wednesday after the company released positive new data from trials of two investigational treatments for genetic muscle disorders.
Micron Technology rose 0.6% to $82.71. Analysts at Piper Sandler upgraded shares of the chip maker to Overweight from Neutral and raised their price target to $95 from $70.
Enphase Energy was downgraded to Sector Weight from Overweight at KeyBanc, with the analysts saying they believe “the timing of recovery in demand is uncertain due to a poorly quantifiable inventory glut
in the channel.” The stock declined 3.7% after falling 6.6% on Wednesday. Sunrun also was downgraded to Sector Weight from Overweight. KeyBanc cited a “recent valuation rebound” for the downgrade. Sunrun shares fell 7.5%.
Conagra Brands fell 1.9% after fiscal second-quarter revenue and the company’s earnings outlook for 2024 missed analysts’ estimates.
MongoDB was downgraded to Neutral from Buy at UBS and the price target was lowered to $410 from $475. Shares of the cloud-based database software provider fell 2.8% to $362.41.
Eli Lilly fell 0.5% after the pharmaceutical company launched a website that improves access to treatments, including weight-loss drugs.
Marathon Digital Holdings (NASDAQ: MARA) climbed 0.8%, adding to today’s gain. The miner of digital assets climbed 12% intraday on strength in Bitcoin, amid ongoing rumors of SEC approval of spot Bitcoin ETFs.
Marvell Technology (NASDAQ: MRVL) climbed 1%. The stock gained late in the session following constructive comments from its CEO, Matt Murphy, during a fireside chat with J.P. Morgan.
Voyager Therapeutics, Inc. (Nasdaq: NASDAQ: VYGR) declined 14% after it announced that it has commenced an underwritten public offering of $100 million of shares of its common stock (or pre-funded warrants to purchase common stock in lieu thereof).
QuantumScape (QS) climbed 3%, adding to earlier gains after positive comments from Volkswagen regarding a solid-state battery prototype. Shares were up 43% intraday.
Catalyst Pharmaceuticals (Nasdaq: CPRX) declined 6% after it commenced an underwritten public offering of $150 million of its common stock.
Market News
US Weekly Jobless Claims Fall More Than Expected
The number of Americans filing new claims for unemployment benefits fell more than expected last week, suggesting that labor market conditions remain fairly tight.
Initial claims for state unemployment benefits dropped 18,000 to a seasonally adjusted 202,000 for the week ended Dec. 30. Economists polled by Reuters had forecast 216,000 claims for the latest week. Claims data tend to be volatile around this time of year because of the holidays.
They have largely bounced around in the lower end of their 194,000-265,000 range for 2023. The labor market is steadily cooling following 525 basis points worth of interest rate hikes from the Federal Reserve since March 2022.
US Private Payrolls Added 164,000 in December, Beating Expectations, ADP Says
Hiring in the private sector rose at a faster than expected pace in December, closing out a strong 2023 for the resilient U.S. jobs market, ADP reported Thursday.
Private payrolls increased by 164,000 for the month, a substantial increase from the downwardly revised 101,000 in November and better than the 130,000 estimate from the Dow Jones consensus, according to the payrolls processing firm.
A rebound in leisure and hospitality led the way, as the sector added 59,000. Hotels, restaurants, bars and similar establishments had led the way in job creation after getting eviscerated in the early days of the Covid pandemic, but job creation in the industry tailed off in recent months. The sector also led in wage gains, with annual growth of 6.4%.
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