A food shopper browses for groceries ahead of the Thanksgiving Day holiday at an Albertsons supermarket in Redmond, Washington, U.S., November 24, 2025.
David Ryder | Reuters
The U.S. inflation numbers in November looked supremely encouraging, with the annual headline rate coming in 0.4 percentage points less than expected. But don’t get too happy about them yet.
It’s the first consumer price report released by the Bureau of Labor Statistics since the U.S. government shutdown ended: October’s figures vanished into the void because the agency was “unable to retroactively collect these data.”
The BLS added that November’s CPI “did not include 1-month percent changes for November 2025 where the October 2025 data are missing.” It also said that certain survey data were “carried forward to October 2025 from September 2025.”
Evercore ISI’s Krishna Guha said it appears the BLS “put in zero inflation in multiple categories” when calculating housing inflation in some cities.
In other words, it’s a noisy report. Federal Reserve Chair Jerome Powell once described setting interest rates as “navigating by the stars under cloudy skies.” With November’s CPI report, the stars aren’t just obscured by clouds — they could be mirages, unidentified flying objects, a seagull that picked up an LED light from the beach.
Nonetheless, investors celebrated the numbers. The CPI report, along with a 10.2% surge in Micron shares on the back of an expectation-busting earnings report, lifted major indexes.
Perhaps it’s the holidays suffusing the air with unbridled cheer. Or maybe it’s all rather like having a feast during Christmas — the calories only count in the new year.
— CNBC’s Sean Conlon contributed to this report.
What you need to know today
And finally…
The Bank of England (BOE) in the City of London, UK, on Monday, Dec. 15, 2025.
US stocks stepped higher on Monday as Wall Street kicked off a packed week full of high-profile earnings and a delayed release of key inflation data.
The Dow Jones Industrial Average (^DJI) nudged up roughly 0.4%, while the S&P 500 (^GSPC) rose 0.5%. The tech-heavy Nasdaq Composite (^IXIC) also gained around 0.5%, with stocks coming off weekly wins.
Wall Street was assessing the fallout from a major Amazon (AMZN) AWS outage early on Monday morning, the ripple effect of which took platforms such as Robinhood (HOOD) offline. The cloud giant underpins services for a swathe of top companies, and users reported disruption at websites ranging from United Airlines (UAL) to Reddit (RDDT). AWS operations are now returning to normal, the Amazon unit said.
Markets are also setting aside a laundry list of worries to focus instead on earnings season, which shifts into high gear this week. Hopes are high, with reports from Tesla (TSLA), Intel (INTC), Netflix (NFLX), and Coca-Cola (KO) leading the highlights in a busy roster.
On Monday, eyes will be on Zions Bancorp’s (ZION) third quarter results due after the bell. The regional lender’s disclosure of bad loans linked to fraud last week spooked investors with concerns about US credit quality.
A lull on the trade war front also provided solace. Treasury Secretary Scott Bessent said relations with Beijing have “de-escalated” and said US-China talks are set to resume this week in Malaysia.
On Sunday, President Trump listed the top issues for the US — rare earths, fentanyl, and soybeans — in a sign the White House is continuing to soften its stance. That raised optimism that Trump’s promised 100% additional tariff on Chinese imports set for Nov. 1 may not come to pass.
Meanwhile, the US government shutdown has entered its third week, with Democrats and Republicans still at odds over federal healthcare subsidies. Economists warn that a prolonged standoff could dent near-term GDP growth, though most see any slowdown as likely temporary.
The federal stoppage has slammed the brakes on inflation and jobs data key to the Federal Reserve’s decision making. But the Bureau of Labor Statistics is set to release September’s Consumer Price Index on Friday, delayed from last week. The data could prove pivotal to the Fed’s rate path, as policymakers enter a quiet period ahead of their two-day meeting next week.
LIVE9 updates
Apple stock opens at record as strong iPhone 17 sales boost optimism
Apple (AAPL) stock opened up more than 2.5% on Monday to trade at a record high after research firm Counterpoint Research said in a note Monday that the firm’s latest iPhone 17 was on track to outsell its predecessor model by some 14% in its first 10 days on the market.
Apple has been a laggard among its Big Tech peers, rising less than 3% so far this year against a nearly 14% gain for the S&P 500.
The company launched the newest version of its iPhone late last month, unveiling the iPhone 17 with a new camera and display, as well as the iPhone 17 Air, a new lightweight, ultra-thin version of its flagship device.
Back in September, Yahoo Finance’s Dan Howley said the new lineup was Apple’s most exciting iPhone rollout in almost a decade.
According to Reuters, Counterpoint’s work also showed that sales of the iPhone 17 in China has nearly doubled sales of iPhone 16 over the same period.
In a note to clients last week, Bank of America’s Wamsi Mohan noted that lead times for the latest iPhone models remained elevated against prior years, indicating strong demand for the new devices.
Stocks rise at the open, oil falls
Stocks marched higher at the open after a significant AWS outage created disruptions at numerous companies on Monday morning.
The Dow Jones Industrial Average (^DJI) rose 0.4%, while the S&P 500 (^GSPC) and tech-heavy Nasdaq Composite (^IXIC) gained 0.5%.
Meanwhile, the 10-year Treasury yield (^TNX) hovered below 4% after falling 2 basis points. The 30-year yield (^TYX) also declined 2 basis points to 4.57%.
Gold (GC=F) futures climbed 2% to $4,334 an ounce. Crude oil futures (CL=F) dropped 1.5% to $56 per barrel.
Tesla, Netflix to report earnings as US-China trade fight turns ‘unsustainable’: What to watch this week
Here’s what lies ahead as markets grapple with the US federal shutdown, a looming oil glut, and “cockroach” fears about credit quality in the economy.
Beyond Meat stock soars 60% amid possible short squeeze
Beyond Meat (BYND) stock surged over 60% in premarket trading on Monday, recouping some of the heavy losses it suffered this year. Shares remain down over 82% year to date, however.
The plant-based meat manufacturer is undergoing a debt restructuring, which last week led traders to dump shares. As of Friday’s close, shares were trading at just $0.64 apiece. With Monday’s move, shares are on track to open back above $1.
The absence of a major catalyst on Monday and increased trading volume suggest the stock may be experiencing a short squeeze, as bearish investors are forced to buy back shares to limit losses.
Beyond Meat has fallen on hard times since its IPO in 2019, a year when the stock traded as high as $240 a share. On Oct. 13, Beyond Meat announced a debt-swap deal that would issue as many as 326 million shares of stock in order to reduce its debt load by about $800 million.
‘Top of my list of worries’: Why the stock market’s boom could become America’s biggest risk
Tesla (TSLA) stock rose 1% before the bell on Monday. The EV maker is set to report its third quarter earnings on Wednesday. Barclays (BCS) also reiterated the stock as Equal Weight and raised its price target to $350 (from $275).
Robinhood (HOOD) stock rose 3% in premarket trading. The trading platform recently had its price target raised from rom $130 to $170 and reiterated an “Outperform” rating by analysts at Citizen JMP.
MP Materials (MP) stock was up 3% before the bell on Monday. The rare-earths materials company has seen a lot of action over the last few weeks after China restricted export of rare earths, forcing the US and other countries to diversify their supply chain. President Trump confirmed on Sunday that rare earth is a key talking point for the US-China trade talks, which will take place in Malaysia this week.
Huge Amazon Web Services outage takes major websites offline
A major outage at Amazon Web Services on Monday morning had a huge knock-on effect, taking down platforms like Coinbase (COIN) and Robinhood (HOOD) in widespread disruption that hit several big websites.
Those hit ranged from United Airlines (UAL) to T-Mobile (TMUS) and Reddit (RDDT), according to Downdetector reports from users. It also degraded services for government agencies and AI companies. per Bloomberg.
Amazon Web Services said at around 6 a.m. ET that its cloud service had recovered significantly after the disruption, which started having an impact about four hours earlier, going by customer complaints.
The cloud provider, whose services underpin a big slice of the web, said a problem on the US East Coast were behind the issues.
NEW YORK (AP) — U.S. stocks rallied on Monday to the cusp of their records.
The S&P 500 climbed 1.1% and pulled within 0.3% of its all-time high set earlier this month. The Dow Jones Industrial Average jumped 515 points, or 1.1%, and the Nasdaq composite gained 1.4%.
Apple led the way and rose 3.9% amid optimism about demand for its latest iPhone design. It was the strongest force lifting the S&P 500 and set its own record high.
Cleveland-Cliffs jumped 21.5% after the steel company’s CEO, Lourenco Goncalves, said it would provide details soon about a potential deal with a major global steel producer that could mean bigger profits. He also said his company has potentially found signs of rare earths at sites in Michigan and Minnesota.
Another source of worry for Wall Street, from the banking industry, also appears to be easing. Stocks of smaller and midsized banks climbed Monday, recovering some of their losses after a couple raised alarm bells last week by warning about potentially bad loans they’ve made.
Zions Bancorp. gained 4.7% Monday following its 5.1% drop last week, when it said it had found “apparent misrepresentations and contractual defaults” related to a couple borrowers.
Amazon’s stock held up despite a widespread outage for its cloud computing service that caused disruption for internet users around the world Monday. Amazon’s stock rose 1.6%.
All told, the S&P 500 added 71.12 points to 6,735.13. The Dow Jones Industrial Average climbed 515.97 to 46,706.58, and the Nasdaq composite gained 310.57 to 22,990.54.
This week features a raft of big names reporting their latest quarterly results, including Coca-Cola on Tuesday, Tesla on Wednesday and Procter & Gamble on Friday.
The pressure is on companies broadly to show that their profits are growing following a torrid run of 35% for the S&P 500 from a low in April. Delivering bigger profits is one of the easiest ways for companies to quiet criticism that stock prices have gone too high. The other is for stock prices to fall.
That’s making the job of the Federal Reserve more difficult, as it tries to decide whether high inflation or the slowing job market is the bigger issue for the economy. Fed officials have indicated they’re likely to cut rates several more times in order to give the economy a boost. But that could be a mistake if inflation worsens, because low interest rates can push it even higher.
On Friday, the U.S. government will issue an update for inflation during September. The report was supposed to arrive earlier in month, and the Social Security Administration needs the numbers to calculate cost-of-living adjustments for beneficiaries. But the government also said, “No other releases will be rescheduled or produced until the resumption of regular government services.”
In the bond market, Treasury yields held relatively steady. The yield on the 10-year Treasury eased to 3.98% from 4.02% late Friday.
In stock markets abroad, indexes rose across much of Europe and Asia.
Japan’s Nikkei 225 jumped 3.4%, after its governing Liberal Democrats found a new coalition partner, securing support for its leader Sanae Takaichi to become the country’s prime minister. Investors expect Takaichi, who would also be Japan’s first female prime minister, to push for low interest rates, higher government spending and other policies that could help the market.
Indexes rose 2.4% in Hong Kong and 0.6% in Shanghai after China reported its economy grew at a 4.8% annual pace in the last quarter, supported by relatively strong exports as companies increased shipments markets other than the U.S.
Still, it was the slowest pace in a year. The world’s second-largest economy is still struggling to emerge from a prolonged downturn in its property market and to encourage consumers and businesses to spend more.
___
AP Business Writers David McHugh and Elaine Kurtenbach contributed.
(Reuters) -Wall Street indexes closed up on Monday with the Nasdaq leading gains as investors bought heavyweight technology stocks and shrugged off the uncertainty of a potential U.S. government shutdown and hawkish remarks from Federal Reserve officials.
Technology provided the benchmark S&P’s biggest boost as investors bet on growth from artificial intelligence and expectations that the Fed will keep cutting interest rates as it grapples with persistent inflation concerns and labor market uncertainties.
A major focus for Wall Street this week is a standoff between Republicans and Democrats over funding that has raised the prospect of a government shutdown beginning Wednesday, the first day of the U.S. government’s new fiscal year.
Even as the Labor Department prepared for a potential delay of its September jobs report in the event of a shutdown, this did not seem to be the key market driver, said Lindsey Bell, chief strategist at 248 Ventures in Charlotte, North Carolina.
“Investors are clinging to the positives,” Bell said, pointing to rate easing hopes and signs of economic resilience from recent releases including housing market and consumer spending data.
“The market is not going to shoot to the moon, because this is a risk. But investors can look through the potential for a shutdown, because if it does occur it will likely be resolved quickly and the market can resume focusing on the things that do matter, like earnings, monetary policy and AI investments.”
While shutdowns have not tended to impact corporate results historically, the imminent threat may have limited gains and kept trading volume light on Monday, according to Burns McKinney, portfolio manager and NFJ Investment Group in Dallas, Texas.
“The only reason it would truly move markets is if it affects the bottom line. Historically speaking, government shutdowns are brief and they don’t have an impact on profitability so investors tend to be forward-looking,” said McKinney.
“It’s just like smoke on a racetrack. They just keep the wheels straight, manage through the stress and move forward through the smoke.”
The Dow Jones Industrial Average rose 68.78 points, or 0.15%, to 46,316.07, the S&P 500 gained 17.51 points, or 0.26%, to 6,661.21 and the Nasdaq Composite gained 107.09 points, or 0.48%, to 22,591.15.
Investors were also monitoring Fed policymakers’ commentary for any signs of concern over the potential loss of economic visibility should a shutdown materialize.
Cleveland Fed President Beth Hammack, among the most hawkish Fed officials and not a voter on policy this year, said on Monday the central bank needed to maintain restrictive monetary policy to cool inflation.
St. Louis Federal Reserve President Alberto Musalem, a voter on rates this year, said he was open to further interest rate cuts but that the Fed must be cautious and keep rates high enough to continue to lean against inflation, which remains roughly a percentage point above the central bank’s 2% target.
Traders, however, are pricing in a roughly 89% chance of a 25-basis-point rate cut at the next Fed meeting, according to CME Group’s FedWatch tool.
Among the S&P 500’s 11 major industry sectors, nine advanced. With oil prices falling more than 3%, the energy sector was the biggest laggard, ending down 1.9%. Consumer discretionary was the biggest percentage gainer, adding 0.6%.
But for index point boosts, technology was the clear leader with big pushes from AI chip leader Nvidia, up 2%, and Microsoft, which added 0.6%.
Electronic Arts shares rallied 4.5% after the game publisher agreed to be taken private in a $55 billion deal, fueling hopes for broader deal prospects, said Bell of 248 Ventures, who saw the transaction as “confirmation that the M&A market is open.”
Lam Research shares advanced 2% after Deutsche Bank upgraded the rating on the chip-making equipment firm to “buy” from “hold.”
AppLovin set a fresh record high before closing up 6.3% at $712.36, also providing one of the biggest lifts for the S&P 500. Morgan Stanley raised the target price on the stock to $750 from $480.
After U.S. President Donald Trump shared a video on Sunday promoting the health benefits of hemp-derived cannabidiol, U.S.-listed shares of cannabis-related companies rose. Canopy Growth rallied 17% to $1.57 while Cronos Group rose almost 13% to $2.97 and Tilray Brands jumped 60.9% to $1.85.
Advancing issues outnumbered decliners by a 1.38-to-1 ratio on the NYSE where there were 337 new highs and 80 new lows. The S&P 500 posted 38 new 52-week highs and six new lows while the Nasdaq Composite recorded 116 new highs and 74 new lows.
On the Nasdaq, 2,525 stocks rose and 2,118 fell as advancing issues outnumbered decliners by a 1.19-to-1 ratio.
On U.S. exchanges about 17.91 billion shares changed hands compared with the 18.25 billion average from the last 20 sessions.
(Reporting by Sinéad Carew in New York, Niket Nishant and Sukriti Gupta in Bengaluru; Editing by Sriraj Kalluvila, Shilpi Majumdar and Richard Chang)
Investors have ridden an incredible recovery from the April 2 “Liberation Day” tariff surprises. Since the April 8 low, the Nasdaq Composite(NASDAQINDEX: ^IXIC) has appreciated an incredible 40%. And of course, that recovery has taken place amid a decade-long bull market in technology growth stocks.
It’s easy to understand why. Society is becoming more digital and automated. The last 10 years have seen the emergence of cloud computing, streaming video, digital advertising, the pandemic-era boom in electronic devices and work-from-home, all topped off by the introduction of generative artificial intelligence (AI) marked by the unveiling of ChatGPT in late 2022.
However, after a long tech bull market, technology growth stocks have reached a worrying valuation level relative to other stocks, and today’s relative overvaluation mirrors an infamous period in stock market history.
In several ways, technology stock performance and valuations are currently mirroring the extremes of the dot-com boom of the late 1990s. Unfortunately, we all know how that period ended, with a terrible “bust” that sent the Nasdaq tumbling three years in a row, eventually culminating in a 78% drawdown from the March 10, 2000, peak.
Technology innovation can be very exciting; however, that excitement often finds itself in the form of high valuations. According to data published on Charlie Bilello’s State of the Markets blog, the technology sector’s recent outperformance has now exceeded that of the height of the dot-com bubble:
Graph showing tech sector performance relative to S&P 500 since 1990.
The relative outperformance isn’t the only mirror to the dot-com era. Back then, tech stocks also became very large, leading to an outperformance of large stocks relative to small stocks. Similarly, tech stocks are often growth stocks with high multiples, reflecting enthusiasm over their future prospects. This is in contrast to value stocks, which trade at low multiples, usually due to their more modest growth prospects.
As you can see below, the outperformance of large stocks to small stocks, as well as growth stocks to value stocks, is at highs last seen during the dot-com boom.
Given that higher-valued tech stocks now make up a larger portion of the index, the Schiller price-to-earnings (P/E) ratio, which adjusts for cyclicality in earnings over 10 years, while not quite at the levels of 1999, has crept up to the highest level since 1999, roughly matching the level from 2021:
As we all know, 2022 was also a terrible year for tech stocks. While it didn’t see a multiyear crash akin to the dot-com bust, 2022 saw the Nasdaq decline 33.1% on the year. Of course, at the end of 2022, ChatGPT came out, somewhat saving the tech sector as the AI revolution kicked off.
Thus, when compared to history, tech stocks are at worrying levels. Given the similarities to the 1999 dot-com bubble and the 2021 pandemic bubble, some may think it’s time to panic and sell; however, there are also a few counter-narratives to consider.
The first is that, unlike in 1999, today’s technology giants are mostly truly diversified, cash-rich behemoths that account for a greater and greater percentage of today’s gross domestic product (GDP). While the late 1990s certainly had its leaders — including Microsoft(NASDAQ: MSFT), the only market leader that is in the same position today as then — they weren’t really anything like today’s tech giants, with robust cloud businesses, global scale, diversified income streams, and tremendous amounts of cash.
While market concentration in the top three weightings tends to occur before market downturns, index weighting concentration appears to be somewhat of a long-term trend now, increasing beyond prior highs in 1999 and 2008 since 2019.
Image source: Charlie Bilello State of the Markets blog.
Thus, it seems a higher weighting of the “Magnificent Seven” stocks could be a feature of today’s economy, rather than an aberration.
While it’s true that some of today’s large companies are overvalued, given their underlying strength and resilience, it’s perhaps not abnormal for them to garner higher-than-normal valuation multiples.
It’s important to know that while taking note of market levels is important, it is extremely difficult to time market downturns. Famed investor Peter Lynch once said, “Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.”
So, one shouldn’t abandon one’s long-term investing plan just because overall market levels may be frothy. That being said, if you need a certain amount of cash in the next one to two years, it may be a good idea to keep that money in cash or Treasury bills until then, rather than the stock market.
Furthermore, if you have a regular, methodical investing plan, stick to it. But if you are consistently adding to your portfolio every month or quarter, you may want to look at small caps, non-tech sectors, and value stocks today, rather than adding to large technology companies.
Before you buy stock in NASDAQ Composite Index, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and NASDAQ Composite Index wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you’d have $649,657!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $1,090,993!*
Now, it’s worth noting Stock Advisor’s total average return is 1,057% — a market-crushing outperformance compared to 185% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.
Billy Duberstein has positions in Microsoft. The Motley Fool has positions in and recommends Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The adoption of artificial intelligence (AI) is continuing at a brisk pace, but some are waiting for the other shoe to drop. A strengthening U.S. economy and robust quarterly results from several AI-related companies helped push the Nasdaq Composite to a new record high last week. Yet these same factors have some investors wondering if the bull market has gone too far, too fast.
Nvidia(NASDAQ: NVDA) has become the de facto standard bearer for the generative AI industry. The company is scheduled to report its fiscal 2025 third-quarter results in less than three weeks, and it’s not an exaggeration to suggest that Wall Street is on pins and needles waiting for the clues that report will offer about the state of AI adoption. Nvidia’s sales have surged since the start of last year, driving the stock up 833% (as of this writing). It’s also less than 5% off the all-time high it touched late last month.
Start Your Mornings Smarter! Wake up with Breakfast news in your inbox every market day. Sign Up For Free »
There’s a lot riding on Nvidia’s upcoming financial report, and many shareholders are wondering whether the stock can possibly continue its breathtaking run. Is it worth picking up shares ahead of its financial report on Nov. 20? Fortunately for investors, data has begun to pile up that could help answer that question.
Image source: Getty Images.
The key to Nvidia’s astounding successes of the past couple of years has been the performance of its graphics processing units (GPUs), which are the best chips for supplying the specific type of computational horsepower necessary for generative AI, as well as other types of cloud computing needs. The necessary resources and the sheer magnitude of data involved limit the top-tier AI models to the world’s largest technology companies and cloud providers — most of which are Nvidia customers. Comments made in conjunction with those tech giants’ recent quarterly results provide some insights about the state of the AI revolution — and the evidence is clear.
For example, Microsoft(NASDAQ: MSFT) said it spent heavily to advance its AI agenda in its fiscal 2025 first quarter (which ended Sept. 30). The company had capital expenditures (capex) of $20 billion, which primarily went to support “cloud and AI-related” demand. CFO Amy Hood expects Microsoft’s spending spree to continue: “We expect capital expenditures to increase on a sequential basis given our cloud and AI demand signals,” she said.
During Alphabet‘s (NASDAQ: GOOGL)(NASDAQ: GOOG) third-quarter earnings call, CEO Sundar Pichai said, “Realizing [the opportunity] of AI requires … meaningful capital investment.” The company revealed capex of $13 billion during the quarter and suggested there would be “substantial increases in capital investment … going into 2025.”
Rounding out the big three cloud providers is Amazon(NASDAQ: AMZN). During its Q3 earnings call, CEO Andy Jassy called generative a “maybe once-in-a-lifetime type of opportunity … we’re aggressively pursuing it.” CFO Brian Olsavsky put that in context, saying Amazon’s capex would amount to roughly $75 billion this year, with much of that going toward cloud computing and AI infrastructure. The company also said it would unveil “100 new cloud infrastructure and AI capabilities” at AWS re:Invent later this month.
Finally, there’s Meta Platforms(NASDAQ: META). While it isn’t a cloud provider, the company’s social media sites attract 3.29 billion people every day, giving Meta vast volumes of user data. The company increased its full-year capex outlook to roughly $39 billion, and CFO Susan Li said, “We continue to expect significant capital expenditures growth in 2025.” She previously noted this was “to support our AI research and product development efforts.”
The trend of accelerating capex to support the growing demand for AI is clear. Additionally, a large fraction of that money will be spent on the data centers and servers needed for cloud computing — where the majority of generative AI software lives. As such, Nvidia will likely be the recipient of a good deal of this spending.
Nvidia has historically kept mum about its biggest customers, but that hasn’t stopped Wall Street from doing some digging. Analysts with Bloomberg and Barclays Research have run the numbers and come to the conclusion that Nvidia’s four biggest customers — generating a total of 40% of its sales — are:
Microsoft: 15%
Meta Platforms: 13%
Amazon: 6.2%
Alphabet: 5.8%
Each of these companies has left no question about their plans to spend heavily on capital expenditures, and in particular to spend heavily on infrastructure to support their cloud computing and AI aspirations. As the leading provider of data center GPUs, Nvidia will likely continue to top the list of beneficiaries of that spending.
Nvidia will deliver its next set of quarterly results on Nov. 20. After achieving triple-digit-percentage year-over-year growth for five consecutive quarters, the company has tried to rein in the market’s expectations, suggesting that its revenue growth this time will only clock in at about 79%. While that would be a deceleration, it would also still be remarkable growth by any stretch of the imagination.
Investors looking to make money over the coming three weeks might be disappointed. No one can say for sure how Nvidia stock will react to the report — even if the company exceeds expectations.
For a reminder of the difficulties involved in short-term prognostication, investors need only look back to this summer, when, starting in mid-June, Nvidia stock lost as much as 27% of its value on fears that its next-generation Blackwell AI processors would be delayed — only to come roaring back. It was an illustration that with this stock, volatility is part of the cost of admission. That said, both the comments made by its big tech customers and their historical spending patterns suggest that Nvidia has further strong growth ahead.
For investors looking for stocks to hold for years and decades rather than weeks and months, Nvidia is a clear choice to benefit from the AI revolution. And trading at roughly 32 times next year’s earnings, it’s still attractively priced. I can’t say for sure what the stock will do between now and Nov. 20. What I can say — with a fair degree of confidence — is that investors who buy Nvidia stock soon and hold it for three to five years or more will be very glad they did.
Before you buy stock in Nvidia, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $829,746!*
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. TheStock Advisorservice has more than quadrupled the return of S&P 500 since 2002*.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Danny Vena has positions in Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The Morgan Stanley headquarters in New York, US, on Wednesday, Dec. 27, 2023.
Angus Mordant | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Follow Decision Time for the ECB live Market watchers are expecting the European Central Bank to cut rates by 25 basis points at its meeting later today. If that projection pans out, it’d be the third time the ECB’s cutting rates this year. Catch today’s action on Decision Time, CNBC’s live show analyzing the decision, starting 1 p.m. BST.
New support measures for real estate China’s housing ministry said Thursday it’ll broaden its “whitelist” initiative to all commercial housing projects, which aims to complete the construction of unfinished homes. The ministry also announced that bank loans to developers will be speeded up and nearly double to 4 million trillion yuan by the end of 2024, from the 2.23 trillion yuan already approved.
Potential probe of Intel Intel is potentially facing a security review by the Cybersecurity Association of China. Officials allege that Intel’s CPU chips possess vulnerabilities in security management and flaws in product quality. CSAC also accused Intel of using remote management features to surveil users.
[PRO] A shining sector that’s not tech nor utilities Big Tech stocks, fueled by excitement over generative artificial intelligence, have been responsible for most of this year’s rally in the market. Gen AI is powered by energy-hungry data centers, which benefits the utilities sector. But there’s a new group of stocks that’s fast becoming one of the best-performing sectors for the year.
The pullback in stocks on Wednesday was brief, like a marathoner pausing to drink before pounding the road again.
“Yesterday’s weakness does not change the intermediate and long-term uptrends, and we believe it will prove to be just a pullback within the context of a longer-term uptrend,” Piper Sandler said in a note.
After dipping from its 43,000 level on Tuesday, the Dow Jones Industrial Average rose 0.79% Wednesday to break that barrier again, closing at 43,077.70.
Markets are basking in the glow of a positive earnings season so far. Around 80% of the 50 S&P companies that have posted earnings have topped expectations, according to FactSet data.
Morgan Stanley, for one, reported third-quarter figures that surpassed earnings and revenue estimates. The bank’s profit jumped 32% from a year ago, far outstripping the LSEG estimate and topping several other big banks’ income growth.
The investment banking business was a main source of profit for Morgan Stanley. Supported by the U.S. Federal Reserve beginning its rate-cutting cycle, initial public offerings and mergers and acquisitions are emerging from hibernation, injecting fresh life into Wall Street banks.
Morgan Stanley popped 6.5% after results. The SPDR S&P Bank ETF has jumped more than 6% over the past five trading days. In another sign of the rally broadening, the banking ETF has outstripped the S&P 500’s climb of less than 1% during the same period.
“We anticipate the macroeconomic and earnings environments to remain favorable,” UBS says, “which supports staying invested in equities.”
With monetary policy easing, the economy staying strong and inflation cooling — import prices dipped 0.4% for September, according to the U.S. Labor Department — stocks look like they have stamina to keep going higher.
– CNBC’s Hugh Son, Alex Harring, Jeff Cox, Lisa Kailai Han and Jesse Pound contributed to this story.
The Morgan Stanley headquarters in New York, US, on Monday, Oct. 14, 2024.
Michael Nagle | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
The pullback in stocks on Wednesday was brief, like a marathoner pausing to drink before pounding the road again.
“Yesterday’s weakness does not change the intermediate and long-term uptrends, and we believe it will prove to be just a pullback within the context of a longer-term uptrend,” Piper Sandler said in a note.
After dipping from its 43,000 level on Tuesday, the Dow Jones Industrial Average rose 0.79% Wednesday to break that barrier again, closing at 43,077.70.
Markets are basking in the glow of a positive earnings season so far. Around 80% of the 50 S&P companies that have posted earnings have topped expectations, according to FactSet data.
Morgan Stanley, for one, reported third-quarter figures that surpassed earnings and revenue estimates. The bank’s profit jumped 32% from a year ago, far outstripping the LSEG estimate and topping several other big banks’ income growth.
The investment banking business was a main source of profit for Morgan Stanley. Supported by the U.S. Federal Reserve beginning its rate-cutting cycle, initial public offerings and mergers and acquisitions are emerging from hibernation, injecting fresh life into Wall Street banks.
Morgan Stanley popped 6.5% after results. The SPDR S&P Bank ETF has jumped more than 6% over the past five trading days. In another sign of the rally broadening, the banking ETF has outstripped the S&P 500’s climb of less than 1% during the same period.
“We anticipate the macroeconomic and earnings environments to remain favorable,” UBS says, “which supports staying invested in equities.”
With monetary policy easing, the economy staying strong and inflation cooling — import prices dipped 0.4% for September, according to the U.S. Labor Department — stocks look like they have stamina to keep going higher.
– CNBC’s Hugh Son, Alex Harring, Jeff Cox, Lisa Kailai Han and Jesse Pound contributed to this story.
Traders work on the floor of the New York Stock Exchange on April 5, 2024.
Spencer Platt | Getty Images News | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Breather from rally U.S. markets fell Tuesday, weighed down by a drop in semiconductor stocks and a 8.1% slide in UnitedHealth. Asia-Pacific stocks were mostly lower Wednesday. Asian chip stocks, like Tokyo Electron and Taiwan Semiconductor Manufacturing Company, retreated on news of ASML’s disappointing forecast and reports of the U.S. possibly imposing export controls on AI chips.
ASML slumps Shares of semiconductor equipment manufacturer ASML plunged 16% on a downbeat earnings report. For 2025, the Netherlands-based company thinks net sales will come in at the lower half of its previous projection. ASML missed expectations on net bookings by 3 billion euros for the September quarter, though net sales beat expectations.
Better than ChatGPT Alibaba updated its artificial-intelligence translation tool, based on a model called Marco MT, on Wednesday. The Chinese e-commerce giant said its product performs better than those by Google and DeepL, according to an assessment by benchmarking tool FLoRes. Fifteen languages are supported by Alibaba’s AI-powered translation tool.
[PRO] Repositioning for slower rate cuts September’s strong jobs report and higher-than-expected inflation reading mean that the U.S. Federal Reserve is unlikely to repeat its jumbo 50-basis-point rate cut at its November meeting. Here’s how strategists are repositioning in view of changing rate cut expectations.
The Dow Jones Industrial Average, which just yesterday was basking in its accomplishment at closing above the 43,000 level for the first time, fell 0.75% to dip into the 42,000 territory again. UnitedHealth’s 8.1% drop dragged down the Dow.
Still, investors are the most bullish in four years, according to the October BofA Global Fund Manager Survey. They’re also optimistic about the economy: 74% investors believe the U.S. will avoid a recession.
Anticipation of more rate cuts by the U.S. Federal Reserve and hopes that Beijing will unleash more stimulus to boost its economy are driving up investor sentiment, according to Michael Hartnett, an investment strategist at BofA.
Indeed, San Francisco Fed President Mary Daly, who’s a member of the Federal Open Market Committee this year, noted that the central bank is “a long way from where [rates are] likely to settle.” That means “the decisions that are really in front of us are ones about how quickly to adjust towards that level” – not whether to keep rates high in light of how strong recent economic data has been.
Another positive sign for markets is how the S&P and Dow hit all-time highs on Monday, but the Nasdaq was still a few percentage points away from its peak. “This subtle divergence is technical evidence that the market has been moving away from the Magnificent Seven mega-caps,” wrote Piper Sandler’s chief market technician Craig Johnson.
– CNBC’s Jeff Cox, Samantha Subin, Yun Li, Lisa Kailai Han and Alex Harring contributed to this story.
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., May 17, 2024.
Brendan McDermid | Reuters
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Breather from rally U.S. markets fell Tuesday, weighed down by a drop in semiconductor stocks and a 8.1% slide in UnitedHealth. The pan-European Stoxx 600 index lost 0.8% as sectors diverged in performance. Tech stocks fell 6.36%, while telecoms stocks rose 1.97%. Separately, euro zone industrial production increased 1.8% between July and August, according to Eurostat.
ASML slumps Shares of semiconductor equipment manufacturer ASML plunged 16% on a downbeat earnings report. For 2025, the Netherlands-based company thinks net sales will come in at the lower half of its previous projection. ASML missed expectations on net bookings by 3 billion euros for the September quarter, though net sales beat expectations.
[PRO] S&P 500 at 6,400? Stocks seem unstoppable. Two years into a bull market, the S&P 500 has been constantly hitting new closing highs. History suggests the bull tends to stall, or at least trip on itself, in its third year. But UBS thinks the S&P can buck the trend in 2025 and soar to 6,400, implying an upside of 10%from Tuesday’s close.
The Dow Jones Industrial Average, which just yesterday was basking in its accomplishment at closing above the 43,000 level for the first time, fell 0.75% to dip into the 42,000 territory again. UnitedHealth’s 8.1% drop dragged down the Dow.
Still, investors are the most bullish in four years, according to the October BofA Global Fund Manager Survey. They’re also optimistic about the economy: 74% investors believe the U.S. will avoid a recession.
Anticipation of more rate cuts by the U.S. Federal Reserve and hopes that Beijing will unleash more stimulus to boost its economy are driving up investor sentiment, according to Michael Hartnett, an investment strategist at BofA.
Indeed, San Francisco Fed President Mary Daly, who’s a member of the Federal Open Market Committee this year, noted that the central bank is “a long way from where [rates are] likely to settle.” That means “the decisions that are really in front of us are ones about how quickly to adjust towards that level” – not whether to keep rates high in light of how strong recent economic data has been.
Another positive sign for markets is how the S&P and Dow hit all-time highs on Monday, but the Nasdaq was still a few percentage points away from its peak. “This subtle divergence is technical evidence that the market has been moving away from the Magnificent Seven mega-caps,” wrote Piper Sandler’s chief market technician Craig Johnson.
– CNBC’s Jeff Cox, Samantha Subin, Yun Li, Lisa Kailai Han and Alex Harring contributed to this story.
Correction: An earlier version of this report misstated the day of U.S. stock movement.
A television station broadcasts the Federal Reserve’s interest-rate cut on the floor of the New York Stock Exchange (NYSE) in New York, US, on Wednesday, Sept. 18, 2024.
Michael Nagle | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Tesla’s Cybercab and Robovan Tesla shares slumped 8.8% after the company’s “We, Robot” event disappointed investors. At the Thursday night event, CEO Elon Musk unveiled the Cybercab, a two-seater with no steering wheels or pedals, and the Robovan, an autonomous vehicle that has a big capacity. But Musk offered little other details, causing analysts to cast doubt on the company.
More assurances from China In a press briefing held Saturday, Chinese Minister of Finance Lan Fo’an told reporters the space for Beijing to increase its budget deficit is “rather large,” but the government is still discussing stimulus plans, according to a CNBC translation of the Chinese. Lan also announced measures to support employment and the real estate industry.
Banks’ earnings in good shape JPMorgan Chase, the biggest bank in the U.S., reported third-quarter earnings and revenue that beat estimates. Net interest income grew 3% from a year ago and helped revenue to increase 6%. Wells Fargo had a decent third quarter. The bank beat estimates for earnings, but unlike JPMorgan, revenue was below expectations and NII decreased.
[PRO] Earnings will show market direction After the deluge of data such as September’s jobs reports and consumer price index report, earnings will determine the path of markets for the near term. Big banks dominate third-quarter reports this week. It’s Bank of America and Goldman Sachs’ turn on Tuesday, while Morgan Stanley announces its earnings on Wednesday.
It seems like September’s hotter-than-expected inflation reading was indeed a blip.
With a snap of its fingers, the producer price index assuaged worries over inflation remaining stubborn. The index, which measures wholesale prices – and thus generally prefigures changes in the CPI – was unchanged in September from August, defying expectations from a Dow Jones survey of a 0.1% increase.
In fact, last week’s inflation figures looked so promising that Goldman Sachs think the Federal Reserve has just about brought inflation down to its 2% target without crashing the economy, as CNBC’s Jeff Cox reports.
While consumer sentiment dipped slightly in October, according to the University of Michigan’s Survey of Consumers, “long run business conditions lifted to its highest reading in six months,” wrote Joanne Hsu, the survey’s director.
JPMorgan Chase’s third-quarter earnings may be the first taste of that. The biggest bank in America beat estimates on both revenue and earnings. As banks generally reflect the health of the broader economy, it’s a signal things aren’t all bad despite dipping consumer confidence.
Admittedly, earnings reflect what has already happened. Investors care more about what’s going to happen. But consumers are “fine and on strong footing,” as JPMorgan’s CFO Jeremy Barnum told reporters.
That capped off a winning week for Wall Street – their fifth in a row. The S&P and Nasdaq climbed 1.1%, while the Dow did a bit better with its 1.2% increase for the week.
“What we’re seeing … is a broadening of the market,” said Craig Sterling, head of U.S. equity research at Amundi US.
It’s a reminder that subduing inflation is just a stop toward investors’ real endgame of a healthy stock market.
– CNBC’s Jeff Cox, Samantha Subin and Brian Evans contributed to this story.
Jerome Powell, chairman of the US Federal Reserve, during the National Association of Business Economics (NABE) annual meeting in Nashville, Tennessee, US, on Monday, Sept. 30, 2024.
Seth Herald | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Winning week for markets All major U.S. indexes rose Friday on the back of encouraging inflation data and positive earnings from big banks. That gave them a winning week. Europe’s Stoxx 600 index climbed 0.55% to end the week higher. Separately, in August, the U.K. economy expanded 0.2% on a monthly basis after stagnating in June and July, according to flash data from U.K. officials.
Tesla’s Cybercab and Robovan Tesla shares slumped 8.8% after the company’s “We, Robot” event disappointed investors. At the Thursday night event, CEO Elon Musk unveiled the Cybercab, a two-seater with no steering wheels or pedals, and the Robovan, an autonomous vehicle that has a big capacity. But Musk offered little other details, causing analysts to cast doubt on the company.
More assurances from China In a press briefing held Saturday, Chinese Minister of Finance Lan Fo’an told reporters the space for Beijing to increase its budget deficit is “rather large,” but the government is still discussing stimulus plans, according to a CNBC translation of the Chinese. Lan also announced measures to support employment and the real estate industry.
Banks’ earnings in good shape JPMorgan Chase, the biggest bank in the U.S., reported third-quarter earnings and revenue that beat estimates. Net interest income grew 3% from a year ago and helped revenue to increase 6%. Wells Fargo had a decent third quarter. The bank beat estimates for earnings, but unlike JPMorgan, revenue was below expectations and NII decreased.
[PRO] Earnings will show market direction After the deluge of data such as September’s jobs reports and consumer price index report, earnings will determine the path of markets for the near term. Big banks dominate third-quarter reports this week. It’s Bank of America and Goldman Sachs’ turn on Tuesday, while Morgan Stanley announces its earnings on Wednesday.
It seems like September’s hotter-than-expected inflation reading was indeed a blip.
With a snap of its fingers, the producer price index assuaged worries over inflation remaining stubborn. The index, which measures wholesale prices – and thus generally prefigures changes in the CPI – was unchanged in September from August, defying expectations from a Dow Jones survey of a 0.1% increase.
In fact, last week’s inflation figures looked so promising that Goldman Sachs think the Federal Reserve has just about brought inflation down to its 2% target without crashing the economy, as CNBC’s Jeff Cox reports.
While consumer sentiment dipped slightly in October, according to the University of Michigan’s Survey of Consumers, “long run business conditions lifted to its highest reading in six months,” wrote Joanne Hsu, the survey’s director.
JPMorgan Chase’s third-quarter earnings may be the first taste of that. The biggest bank in America beat estimates on both revenue and earnings. As banks generally reflect the health of the broader economy, it’s a signal things aren’t all bad despite dipping consumer confidence.
Admittedly, earnings reflect what has already happened. Investors care more about what’s going to happen. But consumers are “fine and on strong footing,” as JPMorgan’s CFO Jeremy Barnum told reporters.
That capped off a winning week for Wall Street – their fifth in a row. The S&P and Nasdaq climbed 1.1%, while the Dow did a bit better with its 1.2% increase for the week.
“What we’re seeing … is a broadening of the market,” said Craig Sterling, head of U.S. equity research at Amundi US.
It’s a reminder that subduing inflation is just a stop toward investors’ real endgame of a healthy stock market.
– CNBC’s Jeff Cox, Samantha Subin and Brian Evans contributed to this story.
The good times are still rolling on Wall Street. An intensifying earnings season will put that momentum to the test. The S & P 500 ended Friday at a record high, buoyed by strong quarterly results from Club holding Wells Fargo and other major financial firms, which reinforced the idea of a healthy U.S. economy. The index posted its fifth positive week in a row, advancing 1.1%. Meanwhile, the Dow Jones Industrial Average rose 1.2% in the week and also closed Friday at an all-time high. The tech-heavy Nasdaq Composite gained 1.1% and now sits just 1.6% below its July peak. The third-quarter earnings calendar starts to get crowded in the coming days, featuring more major U.S. banks, health-care heavyweights and a few industrial and tech players. All eyes will be on the numbers and what executives have to say on their outlooks — just as it should be, according to Jim Cramer. When consumer price index for September came in a bit hotter than expected Thursday morning , Jim cautioned investors against sweating every line in every economic report. Keep your “eye on the prize,” he said. Right now, he said, that prize is “companies which are about to have earnings.” The high-level takeaway from the economic data in recent days is what matters most: Inflation is broadly trending down. The CPI in September showed an annual inflation rate of 2.4%, slightly above consensus but below the 2.5% figure seen in August. In Friday’s look at wholesale inflation, the producer price index was unchanged month over month . Economists had expected a 0.1% monthly gain. As the market marched back to records, we mostly sat tight. Exiting Procter & Gamble on Tuesday was our lone trade of the week. Simply put: a defensive stock like the maker of Crest toothpaste and Dawn soap didn’t seem right for the portfolio as the Federal Reserve embarks on an easing cycle and the economy remains on solid ground. Wells Fargo and JPMorgan reinforced that notion Friday with their earnings reports. Shares of both banks surged — Wells up 5.6%, JPMorgan up 4.4% — and helped the financial sector climb the S & P 500 leaderboard for the week. Tech led the way, up 2.5%, followed by industrials and financials, which added 2.1% and 1.8%, respectively. Utilities and communication services were the main laggards, losing 2.6% and 1.4%, respectively. In the week ahead, a number of influential companies are set to report including UnitedHealth and Goldman Sachs on Tuesday. ASML on Wednesday and Taiwan Semiconductor Manufacturing Co . on Thursday will provide a glimpse at the state of the AI trade before the megacap tech companies report later in the month and beyond. We’ll hear from Club holdings Morgan Stanley and Abbott Laboratories on Wednesday morning. Morgan Stanley: The ongoing recovery in investment banking will be front and center. That was a key theme in the second quarter , and the hope is that the July-to-September period showed a continuation of the trend for Morgan Stanley. An encouraging sign arrived Friday, with JPMorgan reporting a better-than-expected number for its investment banking segment. Shares of Morgan Stanley had suffered through a period of underperformance, leading Jim to openly question whether owning rival Goldman Sachs was a better idea. Morgan Stanley has been strong lately, though. The stock is up more than 14% over the past month and closed Friday at a record $110.91 a share. Morgan Stanley’s results Wednesday should hopefully add more clarity on our next move. Indications that its growing wealth management segment has found its footing would be welcome news. Abbott Labs: The medical products maker’s legal fight over its premature infant formula looks more manageable after a trio of U.S. health agencies recently pushed back against claims that formulas like Abbott’s cause an intestinal illness commonly abbreviated as NEC. To be sure, a second trial on the matter is ongoing in St. Louis, so Abbott Labs is not out of the woods just yet. Nevertheless, agencies including the Food and Drug Administration lending their support to the formulas is a big deal. “You clean up the lawsuits, [the stock] goes to $125,” Jim predicted Friday. The reason it would be so positive? Abbott’s strong fundamentals have been obscured by the legal issues. On that front, we’ll be looking for updates on the U.S. launch of Abbott’s over-the-counter continuous glucose monitoring systems and the state of its medical devices business overall. Weak points in the second quarter were nutrition and established pharmaceuticals, but even with them, Abbott has reported back-to-back beat-and-raise quarters. A third would be nice. Week ahead Monday, Oct.14 Before the bell: Charles Schwab (SCHW) Tuesday, Oct. 15 Before the bell: Walgreens Boots Alliance (WBA), UnitedHealth (UNH), Citigroup (C), Bank of America (BAC), Johnson & Johnson (JNJ) and Goldman Sachs (GS) After the bell: United Airlines (UAL), Interactive Brokers (IBKR) and JB Hunt (JBHT) Wednesday, Oct.16 Before the bell: Morgan Stanley (MS), Abbott Labs (ABT), ASML (ASML), US Bancorp (USB), Citizens (CFG) and Prologis (PLD) After the bell: Alcoa (AA), PPG Industries (PPG), CSX (CSX), Kinder Morgan (KMI), Discover (DFS) and Crown Castle (CCI) Thursday, Oct. 17 8:30 a.m. ET: Initial Jobless Claims 8:30 a.m. ET: Retail Sales 8:30 a.m. ET: Industrial Production & Capacity Utilization Before the bell: Taiwan Semi (TSM), Travelers (TRV), Elevance (ELV), Huntington Bancshares (HBAN), Blackstone (BX), Truist (TFC) and KeyCorp (KEY) After the bell: Netflix (NFLX), Intuitive Surgical (ISRG) and Crown Holdings (CCK) Friday, Oct. 18 8:30 a.m. ET: Housing Starts & Building Permits Before the bell: American Express (AXP), SLB (SLB) and Procter & Gamble (PG) (Jim Cramer’s Charitable Trust is long WFC, MS and ABT. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
A view of the New York Stock Exchange building in the Financial District in New York City on Aug. 5, 2024.
Charly Triballeau | Afp | Getty Images
The good times are still rolling on Wall Street. An intensifying earnings season will put that momentum to the test.
Markets just keep rallying this year, with the S & P 500 up nearly 22% year-to-date and the Nasdaq jumping around 21%. In global stocks, the MSCI World index is around 16% higher. Many on Wall Street expect the trend to continue. Goldman Sachs , Morgan Stanley and others all see the S & P 500 around 6,000 by the end of the year, up from around 5,730 on Tuesday. Mary Ann Bartels, chief investment strategist at Sanctuary Wealth, said that while stocks are grappling with various worries, “liquidity is key and there is plenty of it now that the Fed has started to cut interest rates , and that means that markets can continue to grind higher.” “October, which is historically a seasonally choppy and spooky month for markets, may bring some noticeable stock market turbulence, but the overall trend is clear: stocks on the rise and yields on the decline,” she wrote in an Oct. 2 note, adding that consumer spending remains strong. Meanwhile, recent data indicates that the U.S. Federal Reserve could be close to pulling off the much-discussed economic soft landing . However, Wells Fargo in a Sept. 30 note warned: “The Fed’s more aggressive start to its easing cycle also leaves financial markets exposed to increased volatility by encouraging a rotation into risk assets and leveraging, anticipating an early growth recovery vulnerable to rising inflation and higher interest rates.” With markets already running high, CNBC Pro screened for global stocks that have outperformed the MSCI World index, but still look cheap based on their forward price-to-earnings ratios. Here is the criteria we used: Forward P/E at a discount of 10% or more to the average forward P/E over the past five years. Returns of more than 16% so far this year, beating the MSCI World index. At least half of analysts covering the stock give it a buy rating. Consensus price targets give the stock upside of at least 15%. These stocks turned up.
A MLB store in the Myeongdong shopping district in Seoul, South Korea, on Saturday, March 9, 2024.
Bloomberg | Bloomberg | Getty Images
SINGAPORE — Asia-Pacific markets opened lower Wednesday morning, following a poor start to the trading month on Wall Street that saw major indexes fall amid rising Middle East tensions.
Australia’s S&P/ASX 200 opened down 0.2%, while Japan’s Nikkei 225 started the trading day lower by 1.5%. South Korea’s Kospi fell 1% at the open, while the small-cap Kosdaq was down 0.8%.
Hong Kong’s Hang Seng index futures were at 20,768, lower than the HSI’s last close of 21,133.68. Markets in Mainland China were closed Wednesday and will remain closed for the rest of the week due to the Golden Week holiday.
Traders in Asia were assessing data on consumer inflation out of South Korea. The country’s consumer price index rose 1.6% in September from a year earlier, data showed Wednesday morning, missing expectations by economists polled by Reuters who expected a rate of 1.9%.
Israeli Prime Minister Benjamin Netanyahu said Iran’s missile attacks had failed and vowed retaliation. “Iran made a big mistake tonight — and it will pay for it,” he said, according to NBC News, adding “the regime in Iran does not understand our determination to defend ourselves and our determination to retaliate against our enemies.”
—CNBC’s Brian Evans and Alex Harring contributed to this report.
Neel Kashkari, President and CEO, Federal Reserve Bank of Minneapolis, speaks at the Milken Conference 2024 Global Conference Sessions at The Beverly Hilton in Beverly Hills, California, U.S., May 7, 2024.
David Swanson | Reuters
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Markets regain momentum U.S. markets rose Monday, with the S&P 500 and Dow Jones Industrial Average notching fresh closing highs. Asia-Pacific stocks mostly climbed Tuesday, with the Chinese and Hong Kong markets popping over 3% on Beijing’s announcement of policy easing measures.
PBOC policy easing The People’s Bank of China Governor Pan Gongsheng on Tuesday announced a cut to banks’ reserve requirement ratio. That means banks won’t need as much cash on hand, which injects liquidity into the economy. The yields on Chinese bonds, in turn, dropped to record lows after the PBOC’s announcement.
New property stimulus in China At the same press conference, the PBOC governor also said Beijing will reduce interest rates on existing individual mortgages by an average of half a percentage point, and lower the down-payment ratio for second home purchases to 15% from 25%. Hong Kong-listed shares of property companies surged in response to the stimulus.
Revised offer for Boeing workers Amid a strike by Boeing workers, the company revised its contract offer, raising wages by 30% over four years, up from 25% it proposed earlier. Boeing reinstated annual bonuses and doubled a contract ratification bonus to $6,000 from $3,000. The labor union said Monday it is reviewing the offer.
[PRO] Tech for Big Tech The rising tide of artificial intelligence is lifting related stocks. Specialized chips, data centers and electricity are needed to power the AI boom. Companies in those sectors have seen their stocks rise. The next to benefit from AI, according to Japanese bank Nomura, is the industry specializing in cooling of data centers.
In an interview with CNBC, Minneapolis Fed President Neel Kashkari said, “We still have a strong, healthy labor market. But I want to keep it a strong, healthy labor market.” Kashkari’s emphasis on the strength of the jobs market suggests the Fed wants to reinforce the narrative that the economy’s not staring at a recession.
Atlanta Fed President Raphael Bostic was more circumspect. “Progress on inflation and the cooling of the labor market have emerged much more quickly than I imagined at the beginning of the summer,” he said at a separate event.
That Bostic was possibly surprised by the increase in the unemployment rate is an indication some Fed officials are indeed worried the jobs market isn’t as strong as it should be.
Last, in remarks to the National Association of State Treasurers, Chicago Fed President Austan Goolsbee said that “it’s appropriate to increase our focus on the other side of the Fed’s mandate — to think about risks to employment, too, not just inflation.”
Goolsbee sees “many more rate cuts over the next year” because the state of employment is a “through line on economic conditions.” That suggests economic conditions need the support of additional cuts.
Still, yesterday’s Fedspeak was sufficiently vague and didn’t seem to cause alarm.
Major U.S. indexes ticked up. The S&P rose 0.28%, the Dow advanced 0.15% and the Nasdaq Composite climbed 0.14%. While those increases appear small, they pushed the S&P and Dow to new closing highs.
The narrative the central bank has been on top of its game to ensure a soft landing, then, is very much intact.
– CNBC’s Jeff Cox, Brian Evans and Alex Harring contributed to this story.
Shares of Trump Media sank Monday to their lowest price since 2021, days after majority owner Donald Trump and other company insiders got the green light to start selling their stakes in the Truth Social operator.
The stock, which appears as DJT on the Nasdaq, dropped more than 10% in the final hour of trading, falling as low as $12.16 per share and putting the company on track for its sixth straight day of declines.
Trump Media (DJT) Stock Price
Trump Media’s share price has fallen nearly 85% since the company surged in its public trading debut in late March.
The stock as of Monday at 3:30 p.m. ET was at its lowest intraday level since before October 2021, when it was revealed that the blank-check firm Digital World Acquisition Corp. was planning to merge with then-private Trump Media.
The company’s market capitalization, which crossed $10 billion in March, has shrunk below $2.5 billion. Trump owns nearly 57% of the company’s outstanding shares, a stake worth nearly $1.4 billion as of Monday around noon.
Trump and other company insiders were bound by lockup agreements that barred them from selling their shares in the initial months after Trump Media went public.
Those restrictions expired at the closing bell Thursday.
Trading volume accelerated significantly as the lockup lifted. More than 14 million shares changed hands on Thursday and nearly 22 million were exchanged Friday, far exceeding the 30-day average volume of about 8.3 million shares.
Traders swapped more than 17 million shares on Monday.
Read more CNBC politics coverage
Trump, a main draw for Truth Social users and many retail investors in the company, said earlier in September that he will not sell his stake. The stock price briefly shot up after his remarks.
Other early investors have made no such promises. They include ARC Global, a sponsor of the blank-check firm that took Trump Media public, and United Atlantic Ventures, an entity controlled by two former contestants on Trump’s reality show “The Apprentice.”
ARC and UAV owned nearly 11% of outstanding DJT shares, Trump Media said in a regulatory filing in early September. But ARC’s stake may have grown after a Delaware judge ruled on Sept. 16 that Trump Media breached an agreement with the sponsor and owes it more stock.
This is developing news. Please check back for updates.
A worker sweeps the floor at the Nasdaq MarketSite in New York, US, on Monday, Sept. 16, 2024.
Yuki Iwamura | Bloomberg | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Tech surges After taking a day to digest the U.S. Federal Reserve’s rate cut, investors flocked to tech stocks. On Thursday, Tesla soared 7.4%, Nvidia popped 4% and Apple jumped 3.7%. Lifted by those stocks, the Nasdaq rose 2.5%, its fourth-biggest single-day gain in 2024. Its sharpest rally this year was a 3% increase on Feb. 22.
“Recalibration” Fed Chair Jerome Powell’s use of the word “recalibration” seemed to reassure investors that the central bank’s 50 basis point cut wasn’t thatworrying. It signaled the Fed wasn’t responding to a slowing economy, but shifting focus to ensuring employment doesn’t dip further, wrote CNBC’s Jeff Cox.
Staying its hand The Bank of England decided to hold interest rates steady at 5%. The decision was nearly unanimous: Only one out of nine members in the Monetary Policy Committee voted to reduce rates by a quarter percentage point. Market watchers expect the BOE to cut rates at its next meeting in November.
[PRO] Another big cut? Some experts thought the Fed would lower rates by a quarter percentage point at its September meeting.That call was wrong. A JPMorgan Chase economistnailed the half-point call – and he sees another big rate cut in November.
“Twenty-four little hours / Brought the sun and the flowers / Where there used to be rain,” sings American 1950s star Dinah Washington.
Washington might as well be singing about the market’s behavior. Immediately after the Fed announced the jumbo rate slash on Wednesday, stocks hit fresh highs before falling into the red by the end of that day.
But twenty-four hours later, after investors assessed that the half-point cut probably didn’t portend the start of a recession, major indexes rallied to close at record highs.
The S&P climbed 1.7% to end at 5,713.64, the first time the broad-based index has broken through the 5,700 ceiling. Likewise, the Dow closed at 42,025.19, its first above the 42,000 level, after the index rose 1.26%.
The Nasdaq, buoyed by a rally in names like Tesla, Nvidia and Apple, was the biggest winner among major indexes, surging 2.51%, for its fourth-best day this year.
And while history shows that September hasn’t been nice to stocks, it also tells us that when the S&P notches record highs during the month, the fourth quarter’s likely to remain strong. Since 1950, this pattern has played out in 20 out of 22 occasions, noted Oppenheimer.
Indeed, BMO is so bullish about the market that the bank raised its year-end target for the S&P to 6,100 – an 8.6% climb from Wednesday’s close – the highest projection on Wall Street.
“Much like our last target increase in May, we continue to be surprised by the strength of market gains and decided yet again that something more than an incremental adjustment was warranted,” chief investment strategist Brian Belski wrote to clients in a Thursday note.
At the end of Washington’s song, she croons, “What a difference a day makes / And the difference is you.” Powell can perhaps feel like Washington’s serenading him.
– CNBC’s Alex Harring, Fred Imbert, Hakyung Kim and Lisa Kailai Han contributed to this story.
Correction: An earlier version of this report did not state the time frame for the Nasdaq’s best performance. It has been added to this report.
The sun rises behind the skyline of lower Manhattan and One World Trade Center as people walk along the Hudson River on September 14, 2024, in Jersey City, New Jersey.
Gary Hershorn | Corbis News | Getty Images
This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
Next move for the BOJ The Bank of Japan won’t be raising interest rates at its September meeting, according to a CNBC survey of 32 analysts. However, the outlook for its October and December meetings is less certain. Almost 20% think an October hike is likely, while 25% said the bank’s next hike will be in December.
India’s slowing deposit growth Reserve Bank of India Governor Shaktikanta Das told CNBC in an exclusive interview that slowing growth in deposits is not a cause for concern currently, and said banks are “coming out with new products for deposit mobilization.”
Intel forges new path for foundry Intel shares popped around 8% in extended trading on news the chipmaker plans to structure its foundry business as an independent unit with its own board and ability to raise outside funding. It might even spin off the business as a public company, according to a person with knowledge of the matter. Separately, the Biden administration on Monday awarded Intel up to $3 billion under the CHIPS Act.
[PRO] “Golden age of fixed income” The U.S. Federal Reserve is poised to cut interest rates this week. Benchmark rates affect borrowing costs. This means bond yields will go down as the Fed lowers rates. Rick Rieder, BlackRock’s global chief investment officer of fixed income, thinks now’s the time for investors to take advantage of this “golden age of fixed income.”
Technology stocks benefit the most from low interest rates, conventional market wisdom says.
That’s because tech companies tend to promise future profit in exchange for present money. When rates are low, that proposition appears attractive because returns are low elsewhere. But when rates are high, those promises don’t seem as attractive as less risky returns from assets such as Treasurys.
The past two years have demolished this narrative. Tech has soared even as interest rates have been at 23-year highs, thanks to enthusiasm over artificial intelligence’s promise of new and explosive revenue streams.
Nvidia, the lynchpin of AI, has soared nearly 136% just this year. Meta, which has its own AI model named Llama, is up about 51%.
With the market pricing in a 67% chance — up from 30% last week — that the U.S. Federal Reserve will make a larger-than-usual cut of 50 basis points, according to the CME FedWatch Tool, it stands to reason tech will pop further.
The sector, however, has been rocky in recent weeks. The VanEck Semiconductor ETF, for instance, fell 1.31% Monday, while Nvidia slipped 1.95%.
This implies investors have been moving out of tech to other sectors that might experience tailwinds amid lower rates. Case in point: the financial and energy sectors rose more than 1% on Monday, performing better than the broader market.
Goldman Sachs noted hedge funds’ weekly purchases last week of financial stocks were the highest since June 2023.
“Other areas of the market are starting to perk up, and a lot of that has to do with the future rate cuts that are coming into play,” said Christopher Barto, senior investment analyst at Fort Pitt Capital.
That doesn’t mean tech’s out of favor. It’s likely to continue driving the market. But other sectors might show up for the ride.
– CNBC’s Hakyung Kim, Pia Singh and Yun Li contributed to this story.
