Post-Bell | S&P 500, Nasdaq Jump 1% Each; Nvidia Rises Nearly 4%; Lumen Technologies Soars 93%

Tiger Newspress08-07

The S&P 500 and Nasdaq ended 1% higher on Tuesday as investors jumped back into the market a day after a dramatic sell-off, with recent comments by Federal Reserve officials easing U.S. recession worries.

Market Snapshot

The Dow Jones Industrial Average rose 294.39 points, or 0.76%, to 38,997.66, the S&P 500 rose 53.70 points, or 1.04%, to 5,240.03 and the Nasdaq Composite rose 166.77 points, or 1.03%, to 16,366.85.

Market Movers

Lumen Technologies soared 93% after the telecommunications company said it secured $5 billion in new business “driven by major demand for connectivity fueled” by artificial intelligence and was “in active discussions with customers to secure another $7 billion in sales opportunities to meet the increased customer demand.”

Palantir Technologies rose 10% after second-quarter earnings and revenue beat analysts’ estimates, driven by what the software company’s CEO Alex Karp said was an “unrelenting wave of demand from customers for artificial-intelligence systems that go beyond the merely performative and academic.” Palantir also issued strong revenue guidance for the third quarter.

Nvidia rose 3.8% after the chip maker, the favored choice for training artificial-intelligence systems, ended Monday’s session down 6.4% following a report that said the company’s new chip could be delayed. Nvidia has declined 14% over a three-day stretch.

Super Micro Computer shares slid 13% after reporting fourth-quarter adjusted gross margin below analysts' estimates on Tuesday, as high costs associated with transitioning to newer AI chips weighed on the server maker's profits.

Caterpillar reported second-quarter adjusted earnings of $5.99 a share, higher than Wall Street estimates of $5.54. Operating profit margin in the period was 20.9%. Revenue fell 3.6% to $16.69 billion and missed estimates of $16.91 billion. The stock was up 3%.

Uber Technologies rose 11% after the ride-sharing and food-delivery business reported second-quarter earnings and revenue that beat analysts’ estimates. Uber said gross bookings in the period rose 19% to nearly $40 billion. It expects third-quarter gross bookings of between $40.25 billion and $41.75 billion compared with estimates of $41.18 billion.

CrowdStrike was up 4.3% to $231.69 after analysts at Piper Sandler upgraded shares of the cybersecurity company to Overweight from Neutral. The price target was cut to $290 from $310.

Alphabet was flat after a U.S. federal judge said the company’s Google division engaged in illegal practices to maintain a monopoly in two markets: general search services and general text advertising by using exclusive distribution agreements. “Google is a monopolist, and it has acted as one to maintain its monopoly,” Judge Amit P. Mehta of U.S. District Court for the District of Columbia wrote in a court ruling.

The ruling also could impact Apple, which has received payments from Alphabet for making Google the default search engine on iPhones. Apple shares were down 1% Tuesday after slumping 4.8% Monday following a disclosure from Warren Buffett’s Berkshire Hathaway that it slashed its stake in the tech giant. It was Apple’s worst one-day percentage decline since it fell 4.92% on Sept. 29, 2022.

Kenvue jumped 15% after the owner of brands such as Band-Aid and Tylenol reported second-quarter earnings that beat expectations. The company also reaffirmed its outlook for fiscal-year sales growth and adjusted per-share earnings.

Lucid Group reported second-quarter sales that beat Wall Street estimates and said it received a cash infusion of $1.5 billion from Saudi Arabia’s Public Investment Fund, the electric-vehicle maker’s largest shareholder. The stock rose 3%.

ZoomInfo Technologies slumped 18% after the provider of database information for corporate sales and marketing teams cut its full-year forecast. ZoomInfo said it expects sales for the year of $1.19 billion to $1.205 billion, down from a previous forecast of $1.255 billion to $1.27 billion. Adjusted earnings were forecast at of 86 cents to 88 cents a share, down from the company’s previous guidance of $1 to $1.02 a share. The company also announced the departure of its longtime chief financial officer, Cameron Hyzer.

Chegg, the education-technology company, declined 23% after swinging to a loss in the second quarter following an impairment charge and as subscribers fell 9% to 4.4 million. On an adjusted basis, earnings in the quarter were 24 cents a share, 1 cent better than analysts’ estimates.

Market News

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The National Transportation Safety Board and Boeing said officials still have not determined who removed and reinstalled that plane's door plug during production.

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BlackRock and exchange operator Nasdaq have proposed a rule change to list and trade options for the asset manager's spot ethereum exchange-traded fund, according to a regulatory filing on Tuesday.

In July, the U.S. Securities and Exchange Commission (SEC) approved exchange-traded funds tied to the price of ether from major firms, including Franklin Templeton, VanEck, Bitwise and 21Shares.

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