SAN FRANCISCO — Chipmaker Nvidia will release a quarterly report Wednesday that could provide a better sense of whether the stock market has been riding an overhyped artificial intelligence bubble or is being propelled by a technological boom that’s still gathering momentum.
Nvidia become the first publicly traded company to surpass a market value of $4 trillion last month, and its stock price has gained another 13% since then to create an additional $500 billion in shareholder wealth.
The latest financial results are due out Wednesday afternoon. They have become a key AI barometer during the past two years because Nvidia makes most of the chips that power the technology in vast data centers at the center of the boom.
This summer’s run-up has continued Nvidia’s jaw-dropping rise from early 2023, when the company’s market value was hovering around $400 billion. That was shortly after OpenAI’s late 2022 release of its ChatGPT chatbot triggered the biggest craze in technology since Apple released the first iPhone in 2007.
While the technology industry has been the biggest beneficiary of the AI frenzy, it’s also been a boon for the overall stock market. The benchmark S&P 500 has gained 68% since the end of 2022, with AI fervor fueling much of the investor optimism.
But even amid the general euphoria, there recently have been murmurs about whether AI mania will prove to be an echo of the late 1990s dot-com boom that culminated in an excruciating stock market meltdown in 2000 that eventually drove the U.S. economy and plunged Silicon Valley into a funk that lasted several years before the tech industry began to thrive again.
Investors were recently spooked by a combination of an MIT report that said 95% of AI pilots fail and comments from OpenAI CEO Sam Altman floating the idea that the artificial intelligence market is in a bubble.
And by some metrics, the stock prices of tech companies at the AI are looking frothy. For instance, Nvidia is trading at about 40 times its future earnings, roughly double the rate that investors traditionally believe is a reasonable level. Meanwhile, the market value of Microsoft, another AI leader, is hovering just below $4 trillion, while the values of other fellow pacesetters Amazon, Facebook parent Meta Platforms and Google parent Alphabet currently range from $1.9 trillion to $2.5 trillion.
Nvidia is expected to post another quarter of robust growth for the May-July period of its fiscal year. Analysts surveyed by FactSet research predict Nvidia will earn $1.01 per share, excluding certain items unrelated to its ongoing business, which would be a 49% increase from the same time last year. The analysts anticipated Nvidia’s revenue would rise 53% from a year ago to about $46 billion.
Those gains reflect the financial tsunami flooding the AI market as the biggest players spend heavily to build and expand data centers needed to power the technology. Microsoft, Amazon, Alphabet and Meta are collectively budgeting more than $325 billion for investments in AI this year. With its dominant position in the AI chip market, Nvidia is reaping the benefits of that intense demand.
Even so, the trajectory of Nvidia’s growth has been tapering off. If analyst projections pan out, Nvidia’s revenue growth for its latest quarter will be significantly lower than the 122% increase it posted during the same period last year.
And Nvidia has also been losing business because of President Donald Trump’s trade war with China. Following a ban on its AI chip sales in China, which resulted in a $4.5 billion blow to its finances during its fiscal first quarter, Nvidia estimated that the restrictions would cost it about approximately $8 billion in sales in this during the past quarter.
Trump took the China handcuffs off of Nvidia earlier this month in return for a 15% cut of the company’s sales in that country — a compromise CEO Jensen Huang is expected to discuss with analysts while he shares his perspective on the state of the AI market on a call with investors.
SAN FRANCISCO — Artificial intelligence bellwether Nvidia is poised to release a quarterly report that’s expected provide a better sense about whether the stock market has been riding on an overhyped bubble or whether it’s being propelled by a technological boom that’s still gathering momentum.
The financial results due out Wednesday afternoon have become a key AI barometer during the past two years because Nvidia makes most of the chips that power the technology in vast data centers scattered throughout the boom. Nvidia become the first publicly traded company to surpass a market value of $4 trillion last month, and its stock price has gained another 13% since then to create an additional $500 billion in shareholder wealth.
This summer’s run-up has continued Nvidia’s jaw-dropping rise from early 2023, when the company’s market value was hovering around $400 billion, shortly after OpenAI’s late 2022 release of its ChatGPT chatbot triggered the biggest craze in technology since Apple released the first iPhone in 2007.
While the technology industry has been the biggest beneficiary of the AI frenzy, it’s also been a boon for the overall stock market. The benchmark S&P 500 has gained 68% since the end of 2022, with AI fervor fueling much of the investor optimism.
But even amid the general euphoria, there recently have been murmurs about whether AI mania will prove to be an echo of the late 1990s dot-com boom that culminated in an excruciating stock market meltdown in 2000 that eventually drove the U.S. economy and plunged Silicon Valley into a funk that lasted several years before the tech industry began to thrive again.
Investors were recently spooked by a combination of an MIT report that said 95% of AI pilots fail and comments from OpenAI CEO Sam Altman floating the idea that the artificial intelligence market is in a bubble.
And by some metrics, the stock prices of tech companies at the AI are looking frothy. For instance, Nvidia is trading at about 40 times its future earnings, roughly double the rate that investors traditionally believe is a reasonable level. Meanwhile, the market value of Microsoft, another AI leader, is hovering just below $4 trillion, while the values of other fellow pacesetters Amazon, Facebook parent Meta Platforms and Google parent Alphabet currently range from $1.9 trillion to $2.5 trillion.
Nvidia is expected to post another quarter of robust growth for the May-July period of its fiscal year. Analysts surveyed by FactSet research predict Nvidia will earn $1.01 per share, excluding certain items unrelated to its ongoing business, which would be a 49% increase from the same time last year. The analysts anticipated Nvidia’s revenue would rise 53% from a year ago to about $46 billion.
Those gains reflect the financial tsunami flooding the AI market as the biggest players spend heavily to build and expand data centers needed to power the technology. Microsoft, Amazon, Alphabet and Meta are collectively budgeting more than $325 billion for investments in AI this year. With its dominant position in the AI chip market, Nvidia is reaping the benefits of that intense demand.
Even so, the trajectory of Nvidia’s growth has been tapering off. If analyst projections pan out, Nvidia’s revenue growth for its latest quarter will be significantly lower than the 122% increase it posted during the same period last year.
And Nvidia has also been losing business because of President Donald Trump’s trade war with China. Following a ban on its AI chip sales in China, which resulted in a $4.5 billion blow to its finances during its fiscal first quarter, Nvidia estimated that the restrictions would cost it about approximately $8 billion in sales in this during the past quarter.
Trump took the China handcuffs off of Nvidia earlier this month in return for a 15% cut of the company’s sales in that country — a compromise CEO Jensen Huang is expected to discuss with analysts while he shares his perspective on the state of the AI market on a call with investors.
BANGKOK — Shares logged modest gains Wednesday in Asia after Wall Street benchmarks ended just below their records following a day of choppy trading.
U.S. futures edged higher as investors awaited an earnings update from computer chip giant Nvidia due after trading ends Wednesday in New York. The artificial intelligence bellwether’s quarterly report is expected to help clarify whether markets have been soaring on an overhyped bubble or AI is a technology boom in the making.
Japan’s Nikkei 225 rose 0.3% to 42,522.97, while the Kospi in Seoul was up just over 1 point to 3,181.31.
Hong Kong’s Hang Seng also edged less than 0.1% higher, to 25,541.43 and the Shanghai Composite index advanced 0.3% to 3,881.07.
In Australia the S&P/ASX 200 was up 0.1% at 8,948.30.
Taiwan’s Taiex climbed 0.7% and the SET in Bangkok was up 0.4%.
Markets in India were closed for a public holiday, as 50% tariffs on exports to the United States took effect. The move by U.S. President Donald Trump was expected to hit labor-intensive sectors like textile manufacturing especially hard.
On Wednesday, the S&P 500 closed 0.4% higher at 6,465.94. The Dow gained 0.3% to 45,418.07 and the Nasdaq added 0.4% to 21,544.27.
Boeing rose 3.5% for one of the biggest gains among S&P 500 companies after Korean Air announced a $50 billion deal with the company that includes buying more than 100 aircraft. Dish Network parent EchoStar surged 70.2% after AT&T said it will buy some of its wireless spectrum licenses in a $23 billion deal.
A report said consumer confidence declined modestly in August as anxiety over a weakening job market grew for the eighth straight month. The small decline from The Conference Board’s monthly survey was mostly in line with economists’ projections.
Wall Street notched big gains last week on hopes for interest rate cuts from the Federal Reserve.
But markets were subdued after President Donald Trump escalated his fight with the Federal Reserve by saying he’s firing Federal Reserve Governor Lisa Cook. Cook’s lawyer said she’ll sue Trump’s administration to try to stop him.
Trump has been feuding with the central bank over its cautious interest rate policy. The Fed has held rates steady since late 2024 over worries that Trump’s unpredictable tariff policies will reignite inflation. Trump has also threatened to fire Fed Chair Jerome Powell, often taunting him with name-calling. Still, he is only one of 12 votes that decides interest rate policy.
Traders are still betting the Fed will trim its benchmark interest rate at its next meeting in September. Traders see an 87% chance that the central bank will cut the rate by a quarter of a percentage point, according to data from CME Group.
The Federal Reserve cut its benchmark interest rate in late 2024 after spending the last several years fighting rising inflation by raising interest rates. It managed to mostly tame inflation and avoided having those higher rates stall economic growth, thanks largely to strong consumer spending and a resilient job market.
The Fed hit the pause button heading into 2025 over concerns that higher tariffs imposed by Trump could reignite inflation. Lower interest rates make borrowing easier, helping to spur more investment and spending, but that could also potentially fuel inflation. However, concerns are deepening over the jobs market.
Friday will bring another update on inflation, the U.S. personal consumption expenditures index. Economists expect it show that inflation remained at about 2.6% in July, compared with a year ago. Businesses have been warning investors and consumers about higher costs and prices because of tariffs.
In other dealings early Wednesday, U.S. benchmark crude oil edged up 1 cent to $63.26 a barrel. Brent crude, the international standard, slipped 1 cent to $66.69 a barrel.
The U.S. dollar rose to 147.91 Japanese yen from 147.43 yen. The euro fell to $1.1618 from $1.1643.
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AP Business Writers Stan Choe, Damian Troise and Matt Ott contributed.
Wall Street has recovered some overnight losses that took place after President Donald Trump said he was firing Federal Reserve Governor Lisa Cook.
Futures for the Nasdaq, Dow Jones Industrial Average and S&P 500 all inched down about 0.1% before the bell Tuesday. All three swung notably lower after Trump said in a post Monday that he was removing Cook because of allegations of mortgage fraud by his appointee that heads the agency regulating mortgage giants Fannie Mae and Freddie Mac.
It’s an unprecedented action that suggests a sharp escalation in Trump’s battle to exert greater control over what has long been considered an institution independent from day-to-day politics. Apart from potentially rattling financial markets, it is likely to touch off an extensive legal battle that will probably go to the Supreme Court. Cook said that she does not intend to step down.
“Trump’s decision to remove a sitting Fed governor has shaken confidence in the institution that underpins the world’s financial system,” Nigel Green of the financial advisory deVere Group, said in a commentary.
Most markets overseas declined significantly after Trump’s announcement.
Germany’s DAX lost 0.3%, while the CAC 40 in Paris slumped 1.4%. Britain’s FTSE 100 gave up 0.5%.
Trump has repeatedly attacked the Fed’s chair, Jerome Powell, for not cutting its short-term interest rate, and even threatened to fire him.
Wall Street is still overwhelmingly betting that the Fed will cut interest rates at its next meeting in September. Traders see an 84% chance that the central bank will trim its benchmark rate by a quarter of a percentage point, according to data from CME Group.
In Asian trading, most benchmarks declined.
Japan’s benchmark Nikkei 225 dove nearly 1.0% to finish at 42,394.40. Australia’s S&P/ASX 200 declined 0.4% to 8,935.60.
South Korea’s Kospi lost 1.0% to 3,179.36 after data showed improved consumer sentiment, strengthening expectations that the central bank won’t lower interest rates.
Hong Kong’s Hang Seng shed 1.2% to 25,524.92, while the Shanghai Composite slipped 0.4% to 3,868.38.
In corporate news, Boeing shares were little changed after Korean Air has announced a $50 billion deal to buy more than 100 aircraft from the troubled aerospace manufacturer. The deal includes 19 spare engines and a 20-year maintenance contract.
Benchmark U.S. crude lost $1.09 to $63.71 a barrel. Oil prices are down 8% this month and nearly 14% since the beginning of the summer. That’s due to a combination of production increases by OPEC and the summer travel season winding down.
Brent crude, the international standard, declined $1.02 to $67.20 a barrel.
The U.S. dollar edged down to 147.55 Japanese yen from 147.77 yen. The euro rose to $1.1647 from $1.1620.
BANGKOK — Asian shares advanced on Monday, tracking Wall Street’s rally after the head of the Federal Reserve hinted that cuts to interest rates may be on the way.
Fed chair Jerome Powell said Friday in a speech to an annual conference in Jackson Hole, Wyoming, that he’s seen risks for the job market. A surprisingly weak report on job growth this month has led many traders to expect a rate cut as soon as the Fed’s next meeting in September, after months of pressure from President Donald Trump for lower rates.
Lower interest rates make borrowing easier, helping to spur more investment and spending.
Hong Kong’s Hang Seng index jumped 2.1% to 25,866.49, while the Shanghai Composite index surged 0.9% to 3,858.59. It’s trading at its highest level in a decade, despite worries over higher tariffs on exports to the United States under Trump and weak domestic demand at home.
Taiwan’s Taiex was up 2.5% as semiconductor maker TSMC Corp.’s shares advanced 3.1%.
Tokyo’s Nikkei 225 gained 0.3% to 42,767.41, with computer chip-related companies leading gains.
The Kospi in South Korea climbed 1.1% to 3,204.48.
Australia’s S&P/ASX 200 edged 0.2% higher, while the SET in Bangkok gained 1%.
“Asia is set to rally in catch-up mode, feeding off Wall Street’s Friday rebound after Powell cracked the door open to rate cuts,” Stephen Innes of SPI Asset Management said in a commentary.
This week, Nvidia’s earnings report, due Wednesday after markets on Wall Street close, is a key focus of attention.
Nvidia’s role as a key supplier of chips for artificial intelligence and its heavy weighting give it outsized influence as a bellwether for the broader market.
On Friday, the S&P 500 leaped 1.5% for its first gain in six days, closing at 6,466.91. That’s just shy of its all-time high set last week.
The Dow Jones Industrial Average soared 846 points, or 1.9%, to its own record of 45,631.74. Nasdaq composite jumped 1.9% to 21,496.53.
Investors love lower interest rates, even if they risk adding to inflation.
Stocks of smaller companies led the way. They can benefit more from lower interest rates because of their need to borrow money to grow. The smaller stocks in the Russell 2000 index surged 3.9% for its best day since April.
Still, Powell did not commit to any kind of timing. He said the job market looks OK, even if “it is a curious kind of balance” where fewer new workers are chasing after fewer new jobs. Inflation, meanwhile, still has the potential to push higher.
The yield on the 10-year Treasury fell to 4.25% from 4.33% late Thursday. The two-year Treasury yield, which more closely tracks expectations for Fed action, sank to 3.69% from 3.79% in a notable move for the bond market.
Nvidia rose 1.7% to trim its loss for the week. The company, whose chips are powering much of the world’s move in to artificial-intelligence technology, had seen its stock struggle recently amid criticism that it and other AI superstars shot too high, too fast and became too expensive.
In other dealings early Monday, U.S. benchmark crude oil gained 8 cents to $63.74 per barrel. Brent crude, the international standard, added 4 cents to $67.26 per barrel.
The U.S. dollar rose to 147.22 Japanese yen from 146.88 yen. The euro fell to $1.1707 from $1.1727.
NEW YORK (AP) — Wall Street fell to a fifth straight loss on Thursday, hurt by a drop for Walmart and dampened hopes for coming cuts to interest rates.
The S&P 500 slipped 0.4%. All its losses have been relatively modest, but it has not risen since setting an all-time high last Thursday. The Dow Jones Industrial Average dropped 152 points, or 0.3%, and the Nasdaq composite fell 0.3%.
Walmart was one of the market’s heaviest weights and dropped 4.5% after reporting a profit for the spring that came up short of analysts’ expectations, while Nvidia and other Big Tech stocks held a bit steadier following two days of sharp swings.
The moves were stronger in the bond market, where Treasury yields rose after a report forced Wall Street to scale back hopes that the Federal Reserve may soon deliver relief by cutting interest rates.
AP AUDIO: Wall Street edges lower in its final moves ahead of a speech by the Federal Reserve’s head
U.S. stocks are falling after a weaker-than-expected profit report from a major retailer. The AP’s Seth Sutel reports.
The report suggested growth in U.S. business activity is accelerating and hit its fastest rate so far this year. That’s good news for the economy, but the preliminary data from S&P Global also said tariffs helped push up average selling prices at the fastest rate in three years. That’s a discouraging sign for inflation.
Taken all together, such data has historically aligned more with the Federal Reserve considering a hike in interest rates, rather than a cut, according to Chris Williamson, chief business economist at S&P Global Market Intelligence.
No one expects a rate hike to happen, but the overwhelming expectation on Wall Street has been for coming cuts. Traders are betting on a nearly three-in-four chance that the Fed will lower its main interest rate at its next meeting in September, according to data from CME Group. The hope on Wall Street has been that Fed Chair Jerome Powell may give hints on Friday that easier rates may be coming.
He will be speaking in Jackson Hole, Wyoming, at an annual conference of central bankers that’s been home to big policy announcements in the past.
A cut in interest rates would be the first of the year, and it would give investment prices and the economy a boost by potentially making it cheaper to borrow to buy cars or equipment. But it could also risk worsening inflation.
The Fed has been hesitant to cut interest rates this year out of fear that President Donald Trump’s tariffs could push inflation higher, but a surprisingly weak report on job growth earlier this month suddenly made the job market a bigger worry. Trump, meanwhile, has angrily pushed for cuts to interest rates, often insulting Powell while doing so.
The yield on the 10-year Treasury, which helps set rates for mortgages, rose to 4.32% from 4.29%. The two-year Treasury, which moves more on expectations for what the Federal Reserve will do with short-term interest rates, climbed to 3.78% from 3.74%.
On Wall Street, Walmart dropped even though it reported encouraging growth in revenue during the latest quarter and raised its forecast for profit over its full fiscal year.
Analysts said the market’s expectations were high coming into the report. The Bentonville, Arkansas, company’s stock came into the day with a gain of 13.5% for the year so far, more than the rest of the market.
Big Tech stocks are under even more pressure to deliver bigger profits amid criticism that their stock prices ran too high, too fast and have become too expensive because of the frenzy around artificial-intelligence technology.
Several AI superstar stocks have swung sharply this week, taking some shine off their skyscraping surges for the year, because of such criticism. But they held a bit steadier on Thursday.
Palantir Technologies, which at one point on Wednesday was on track to fall more than 9% for a second straight day before paring its loss, rose 0.1%. Nvidia, the chip company that’s become the poster child of the AI boom, edged down 0.2%.
Coty tumbled 21.6% after the beauty products company reported a loss for the latest quarter, when analysts expected a slight profit. The company, whose brands include CoverGirl and Joop!, said uncertainty about tariffs and the economy are making retailers cautious in their orders.
On the winning side of Wall Street was Nordson, which makes products and systems used for precision dispensing and other things. It delivered profit and revenue for the latest quarter that topped analysts’ expectations, and its stock rose 3%.
All told, the S&P 500 slipped 25.61 points to 6,370.17. The Dow Jones Industrial Average fell 152.81 to 44,785.50, and the Nasdaq composite sank 72.55 to 21,100.31.
In stock markets abroad, indexes were mixed across much of Europe and Asia.
NEW YORK (AP) — Wall Street rallied to its best day in months on Friday after the head of the Federal Reserve hinted that cuts to interest rates may be on the way, along with the kick they can give the economy and investment prices.
The S&P 500 leaped 1.5% for its first gain in six days and finished just shy of its all-time high set last week.
The Dow Jones Industrial Average soared 846 points, or 1.9%, to its own record after topping its prior high from December. The Nasdaq composite jumped 1.9%.
“Ka-Powell” is how Brian Jacobsen, chief economist at Annex Wealth Management, described the reaction to Jerome Powell’s highly anticipated speech in Jackson Hole, Wyoming. “The Fed isn’t going to be the party-pooper.”
The hope among investors had been that Powell would hint that the Fed’s first cut to interest rates of the year may be imminent. Wall Street loves lower rates because they can goose the economy, even if they risk worsening inflation at the same time.
President Donald Trump has angrily been calling for lower rates, often insulting Powell while doing so. And a surprisingly weak report on job growth this month pushed many on Wall Street to assume cuts may come as soon as the Fed’s next meeting in September.
Powell encouraged them on Friday after saying he’s seen risks rise for the job market. The Fed’s two jobs are to keep the job market healthy and to keep a lid on inflation, and it often has to prioritize one over the other because it has just one tool to fix either.
But Powell also would not commit to any kind of timing. He said the job market looks OK at the moment, even if “it is a curious kind of balance” where fewer new workers are chasing after fewer new jobs. Inflation, meanwhile, still has the potential to push higher because of Trump’s tariffs.
In sum, Powell said that “the stability of the unemployment rate and other labor market measures allows us to proceed carefully as we consider changes to our policy stance.”
Treasury yields tumbled in the bond market as bets built that the Fed would cut its main interest rate in September. Traders see an 83% chance of that, up from 75% a day earlier, according to data from CME Group.
The yield on the 10-year Treasury fell to 4.25% from 4.33% late Thursday. The two-year Treasury yield, which more closely tracks expectations for Fed action, sank to 3.69% from 3.79% in a notable move for the bond market.
On Wall Street, stocks of smaller companies led the way. They can benefit more from lower interest rates because of their need to borrow money to grow. The smaller stocks in the Russell 2000 index surged 3.9% for its best day since April and more than doubled the S&P 500’s rally.
Homebuilders jumped on hopes that easier interest rates could encourage more people to buy homes. Lennar, PulteGroup and D.R. Horton all rose more than 5%.
Travel companies, meanwhile, climbed amid hopes that easier interest rates could help U.S. households spend more. Norwegian Cruise Line rallied 7.2%, Delta Air Lines flew 6.7% higher and Caesars Entertainment rose 7%.
Shares of Nio, a Chinese electric-vehicle maker, that trade in the United States leaped 14.4% after it began pre-sales of its flagship premium SUV model, the ES8.
Nvidia rose 1.7% to trim its loss for the week. The company, whose chips are powering much of the world’s move in to artificial-intelligence technology, had seen its stock struggle recently amid criticism that it and other AI superstars shot too high, too fast and became too expensive.
Nvidia CEO Jensen Huang said Friday that the company is discussing a potential new computer chip designed for China with the Trump administration. The chips are graphics processing units, or GPUs, a type of device used to build and update a range of AI systems. But they are less powerful than Nvidia’s top semiconductors today, which cannot be sold to China due to U.S. national security restrictions.
All told, the S&P 500 jumped 96.74 points to 6,466.91. The Dow Jones Industrial Average leaped 846.24 to 45,631.74, and the Nasdaq composite rallied 396.22 to 21,496.53.
In stock markets abroad, Germany’s DAX returned 0.3% after government data showed that its economy shrank by 0.3% in the second quarter compared with the previous three-month period.
Indexes rose across much of Asia, with stocks climbing 1.4% in Shanghai and 0.9% in South Korea.
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AP Writers Teresa Cerojano and Matt Ott contributed.
NEW YORK — After a shaky four years on Wall Street, Soho House is ready to go private again.
The luxury members club operator has struck a deal with an investor group led by hotel giant MCR, which will buy its outstanding shares for $9 each in cash. Soho House’s Executive Chairman Ron Burkle and other big shareholders will roll over their stakes and retain control of the business, per a Monday announcement from the company.
The take-private offer implies a total enterprise value of roughly $2.7 billion for Soho House, including debt. The company says it expects to complete the deal by the end of 2025, pending the regulatory greenlight and other closing conditions. If approved, the transaction means Soho House will stop trading on the New York Stock Exchange.
Shares of Soho House climbed more than 15% by mid-morning Monday, following news of Soho House signing the agreement.
Among other big names to join Soho House’s future leadership is actor and now tech investor Ashton Kutcher, who is set to join the company’s board following the deal’s completion. Tyler Morse, CEO of New York-based MCR, will also join the board as Vice Chairman.
In a statement, Morse said that MCR had “long admired” Soho House and that its investment in the company “represents a strategic opportunity to combine our operational expertise with one of the most distinctive brands in hospitality.”
Soho House CEO Andrew Carnie pointed to the club’s growth over the years, and said that returning to private ownership will help the company “build on this momentum.”
Soho House’s roots date back to 1995, starting with a single club in London opened by founder Nick Jones. But today, the company’s footprint includes 46 Soho House locations worldwide, in addition to a handful of coworking spaces, beach clubs and digital platforms.
Soho House describes itself as a “global membership platform of physical and digital spaces.” It bills its flagship clubs — which include spas, gyms and other luxury amenities — as a “home for creative people to come together and belong.” Known for attracting celebrities and other figures with deep pockets, membership fees often rack up to at least several thousand dollars a year.
Soho House had more than 270,000 total members as of the end of June. And the company has reported an uptick in revenue during recent quarters. In earnings announced earlier this month, Soho House said had a total of it raked in $329.8 million in total revenues for its second fiscal quarter, an 8.9% jump year-over-year.
Despite recent growth, the company’s stock has tumbled during its time on the public market. Since Soho House began trading in 2021, its stock has fallen roughly 30%, trading at under $9 a share on Monday. That’s down from $14 a share that the company debuted in its July 2021 initial public offering.
NEW YORK (AP) — The typical compensation package for chief executives who run companies in the S&P 500 jumped nearly 10% in 2024 as the stock market enjoyed another banner year and corporate profits rose sharply.
Many companies have heeded calls from shareholders to tie CEO compensation more closely to performance. As a result, a large proportion of pay packages consist of stock awards, which the CEO often can’t cash in for years, if at all, unless the company meets certain targets, typically a higher stock price or market value or improved operating profits.
The Associated Press’ CEO compensation survey, which uses data analyzed for The AP by Equilar, included pay data for 344 executives at S&P 500 companies who have served at least two full consecutive fiscal years at their companies, which filed proxy statements between Jan. 1 and April 30.
Here are the key takeaways from the survey:
A good year at the top
The median pay package for CEOs rose to $17.1 million, up 9.7%. Meanwhile, the median employee at companies in the survey earned $85,419, reflecting a 1.7% increase year over year.
CEOs had to navigate sticky inflation and relatively high interest rates last year, as well as declining consumer confidence. But the economy also provided some tail winds: Consumers kept spending despite their misgivings about the economy; inflation did subside somewhat; the Fed lowered interest rates; and the job market stayed strong.
The stock market’s main benchmark, the S&P 500, rose more than 23% last year. Profits for companies in the index rose more than 9%.
“2024 was expected to be a strong year, so the (nearly) 10% increases are commensurate with the timing of the pay decisions,” said Dan Laddin, a partner at Compensation Advisory Partners.
Sarah Anderson, who directs the Global Economy Project at the progressive Institute for Policy Studies, said there have been some recent “long-overdue” increases in worker pay, especially for those at the bottom of the wage scale. But she said too many workers in the world’s richest countries still struggle to pay their bills.
The top earners
Rick Smith, the founder and CEO of Axon Enterprises, topped the survey with a pay package valued at $164.5 million. Axon, which makes Taser stun guns and body cameras, saw revenue grow more than 30% for three straight years and posted record annual net income of $377 million in 2024. Axon’s shares more than doubled last year after rising more than 50% in 2023.
General Electric Co. CEO Lawrence Culp Jr. signs a $52 billion deal by Emirates to purchase Boeing aircraft with GE engines, at the Dubai Air Show, in Dubai, United Arab Emirates, Monday, Nov. 13, 2023. (AP Photo/Lujain Jo)
General Electric Co. CEO Lawrence Culp Jr. signs a $52 billion deal by Emirates to purchase Boeing aircraft with GE engines, at the Dubai Air Show, in Dubai, United Arab Emirates, Monday, Nov. 13, 2023. (AP Photo/Lujain Jo)
Almost all of Smith’s pay package consists of stock awards, which he can only receive if the company meets targets tied to its stock price and operations for the period from 2024 to 2030. Companies are required to assign a value to the stock awards when they are granted.
Other top earners in the survey include Lawrence Culp, CEO of what is now GE Aerospace ($87.4 million), Tim Cook at Apple ($74.6 million), David Gitlin at Carrier Global ($65.6 million) and Ted Sarandos at Netflix ($61.9 million). The bulk of those pay packages consisted of stock or options awards.
The median stock award rose almost 15% last year compared to a 4% increase in base salaries, according to Equilar.
Tim Cook attends the WSJ. Magazine Innovators Awards at the Museum of Modern Art on Tuesday, Oct. 29, 2024, in New York. (Photo by Evan Agostini/Invision/AP, File)
Tim Cook attends the WSJ. Magazine Innovators Awards at the Museum of Modern Art on Tuesday, Oct. 29, 2024, in New York. (Photo by Evan Agostini/Invision/AP, File)
“For CEOs, target long-term incentives consistently increase more each year than salaries or bonuses,” said Melissa Burek, also a partner at Compensation Advisory Partners. “Given the significant role that long-term incentives play in executive pay, this trend makes sense.”
Jackie Cook at Morningstar Sustainalytics said the benefit of tying CEO pay to performance is “that share-based pay appears to provide a clear market signal that most shareholders care about.” But she notes that the greater use of share-based pay has led to a “phenomenal rise” in CEO compensation “tracking recent years’ market performance,” which has “widened the pay gap within workplaces.”
Some well-known billionaire CEOs are low in the AP survey. Warren Buffett’s compensation was valued at $405,000, about five times what a worker at Berkshire Hathaway makes. According to Tesla’s proxy, Elon Musk received no compensation for 2024, but in 2018 he was awarded a multiyear package that has been valued at $56 billion and is the subject of a court battle.
Other notable CEOs didn’t meet the criteria for inclusion the survey. Starbucks’ Brian Niccol received a pay package valued at $95.8 million, but he only took over as CEO on Sept. 9. Nvidia’s Jensen Huang saw his compensation grow to $49.9 million, but the company filed its proxy after April 30.
The pay gap
At half the companies in AP’s annual pay survey, it would take the worker at the middle of the company’s pay scale 192 years to make what the CEO did in one. Companies have been required to disclose this so-called pay ratio since 2018.
The pay ratio tends to be highest at companies in industries where wages are typically low. For instance, at cruise line company Carnival Corp., its CEO earned nearly 1,300 times the median pay of $16,900 for its workers. McDonald’s CEO makes about 1,000 times what a worker making the company’s median pay does. Both companies have operations that span numerous countries.
Overall, wages and benefits netted by private-sector workers in the U.S. rose 3.6% through 2024, according to the Labor Department. The average worker in the U.S. makes $65,460 a year. That figure rises to $92,000 when benefits such as health care and other insurance are included.
“With CEO pay continuing to climb, we still have an enormous problem with excessive pay gaps,” Anderson said. “These huge disparities are not only unfair to lower-level workers who are making significant contributions to company value – they also undercut enterprise effectiveness by lowering employee morale and boosting turnover rates.”
Some gains for female CEOs
This photo provided by Otis Elevator Co. shows CEO Judy Marks. (via AP)
This photo provided by Otis Elevator Co. shows CEO Judy Marks. (via AP)
For the 27 women who made the AP survey — the highest number dating back to 2014 — median pay rose 10.7% to $20 million. That compares to a 9.7% increase to $16.8 million for their male counterparts.
The highest earner among female CEOs was Judith Marks of Otis Worldwide, with a pay package valued at $42.1 million. The company, known for its elevators and escalators, has had operating profit above $2 billion for four straight years. About $35 million of Marks’ compensations was in the form of stock awards.
Other top earners among female CEOs were Jane Fraser of Citigroup ($31.1 million), Lisa Su of Advanced Micro Devices ($31 million), Mary Barra at General Motors ($29.5 million) and Laura Alber at Williams-Sonoma ($27.7 million).
FILEw – Jane Fraser, CEO, Citigroup, speaks during a Senate Banking, Housing, and Urban Affairs Committee oversight hearing to examine Wall Street firms on Capitol Hill, Wednesday, Dec. 6, 2023 in Washington. (AP Photo/Alex Brandon, File)
FILEw – Jane Fraser, CEO, Citigroup, speaks during a Senate Banking, Housing, and Urban Affairs Committee oversight hearing to examine Wall Street firms on Capitol Hill, Wednesday, Dec. 6, 2023 in Washington. (AP Photo/Alex Brandon, File)
Lisa Su, CEO of Advanced Micro Devices, arrives for a dinner at the Elysee Palace, during an event on the sidelines of the Artificial Intelligence Action Summit in Paris, Monday, Feb. 10, 2025. (AP Photo/Thomas Padilla, File)
Lisa Su, CEO of Advanced Micro Devices, arrives for a dinner at the Elysee Palace, during an event on the sidelines of the Artificial Intelligence Action Summit in Paris, Monday, Feb. 10, 2025. (AP Photo/Thomas Padilla, File)
Christy Glass, a professor of sociology at Utah State University who studies equity, inclusion and leadership, said while there may be a few more women on the top paid CEO list, overall equity trends are stagnating, particularly as companies cut back on DEI programs.
“There are maybe a couple more names on the list, but we’re really not moving the needle significantly,” she said.
FILE- Mary Barra, chair and CEO of General Motors, talks to David Rubenstein during an interview hosted by the Economic Club of Washington, Wednesday, Dec. 13, 2023, in Washington. (AP Photo/Stephanie Scarbrough, File)
FILE- Mary Barra, chair and CEO of General Motors, talks to David Rubenstein during an interview hosted by the Economic Club of Washington, Wednesday, Dec. 13, 2023, in Washington. (AP Photo/Stephanie Scarbrough, File)
Prioritizing security
Equilar found that a larger number of companies are offering security perquisites as part of executive compensation packages, possibly in reaction to the December shooting of UnitedHealthCare CEO Brian Thompson.
Equilar said an analysis of 208 companies in the S&P 500 that filed proxy statements by April 2 showed that the median spending on security rose to $94,276 last year from $69,180 in 2023.
Among the companies that increased their security perks were Centene, which provides health care services to Medicare and Medicaid, and the chipmaker Intel.
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Reporters Matt Ott and Chris Rugaber in Washington contributed.
NEW YORK (AP) — The U.S. stock market rallied to records on Tuesday after data suggested inflation across the country was a touch better last month than economists expected.
The S&P 500 rose 1.1% to top its all-time high set two weeks ago. The Dow Jones Industrial Average climbed 483 points, or 1.1%, and the Nasdaq composite jumped 1.4% to set its own record.
Stocks got a lift from hopes that the better-than-expected inflation report will give the Federal Reserve leeway to cut interest rates at its next meeting in September.
Lower rates would give a boost to investment prices and to the economy by making it cheaper for U.S. households and businesses to borrow to buy houses, cars or equipment. President Donald Trump has angrily been calling for cuts to help the economy, often insulting the Fed’s chair personally while doing so.
AP AUDIO: Wall Street rises toward records on hopes for lower interest rates
AP business correspondent Seth Sutel reports markets are leaning higher.
But the Fed has been hesitant because of the possibility that Trump’s tariffs could make inflation much worse. Lowering rates would give inflation more fuel, potentially adding oxygen to a growing fire. That’s why Fed officials have said they wanted to see more data come in about inflation before moving.
Tuesday’s report said U.S. consumers paid prices for groceries, gasoline and other costs of living that were overall 2.7% higher in July than a year earlier. That’s the same inflation rate as June’s, and it was below the 2.8% that economists expected.
The report pushed traders on Wall Street to increase bets that the Fed will cut interest rates for the first time this year in September. They’re betting on a 94% chance of that, up from nearly 86% a day earlier, according to data from CME Group.
The Fed will receive one more report on inflation, as well as one more on the U.S. job market, before its next meeting, which ends Sept. 17. The most recent jobs report was a stunner, coming in much weaker than economists expected.
Some economists warn that more twists and turns in upcoming data could make the Fed’s upcoming decisions not so easy. Its twin goals are to get inflation to 2% while keeping the job market healthy. Helping one with interest rates, though, often means hurting the other.
Even Tuesday’s better-than-expected inflation report had some discouraging undertones. An underlying measure of inflation, which economists say does a better job of predicting where inflation may be heading, hit its highest point since early this year, noted Gary Schlossberg, market strategist at Wells Fargo Investment Institute. That helped cause some up-and-down swings for Treasury yields in the bond market.
“Eventually, tariffs can show up in varying degrees in consumer prices, but these one-off price increases don’t happen all at once,” said Brian Jacobsen, chief economist at Annex Wealth Management. “That will confound the Fed and economic commentators for months to come.”
Other central banks around the world have been lowering interest rates, and Australia’s on Tuesday cut for the third time this year.
Circle Internet Group, the company behind the popular USDC cryptocurrency that tracks the U.S. dollar, climbed 1.3% despite reporting a larger loss for the latest quarter than analysts expected. It said its total revenue and reserve income grew 53% in its first quarter as a publicly traded company, which topped forecasts.
On the losing side of Wall Street was Celanese, which sank 13.1% even though the chemical company delivered a better profit than expected. It said that customers in most of its markets continue to be challenged, and CEO Scott Richardson said that “the demand environment does not seem to be improving.”
Cardinal Health dropped 7.2% despite likewise reporting a stronger profit for the latest quarter than analysts expected. Its revenue fell short of forecasts, and analysts said the market’s expectations were particularly high for the company after its stock had already soared 33.3% for the year coming into the day.
Critics say the broad U.S. stock market is looking expensive after its surge from a bottom in April. That’s putting pressure on companies to deliver continued growth in profit.
All told, the S&P 500 rose 72.31 points to 6,445.76. The Dow Jones Industrial Average climbed 483.52 to 44,458.61, and the Nasdaq composite jumped 296.50 to 21,681.90.
In stock markets abroad, indexes edged up in China after Trump signed an executive order late Monday that delayed hefty tariffs on the world’s second-largest economy by 90 days. The move was widely expected, and the hope is that it will clear the way for a possible deal to avert a dangerous trade war between the United States and China.
Japan’s Nikkei 225 jumped 2.1%, and South Korea’s Kospi fell 0.5% for two of the world’s bigger moves.
In the bond market, the yield on the 10-year Treasury rose to 4.28% from 4.27% late Monday.
The yield on the two-year Treasury, which more closely tracks expectations for the Fed, fell to 3.73% from 3.76%.
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AP Business Writers Yuri Kageyama and Matt Ott contributed.
SAN FRANCISCO — Apple snapped out of a recent iPhone sales slump during its summer quarter, an early sign that its recent efforts to revive demand for its marquee product with an infusion of artificial intelligence are paying off.
Sales of the iPhone totaled $46.22 billion for the July-September period, a 6% increase from the same time last year, according to Apple’s fiscal fourth-quarter report released Thursday. That improvement reversed two consecutive year-over-year declines in the iPhone’s quarterly sales.
The iPhone boost helped Apple deliver total quarterly revenue and profit that exceeded the analyst projections that sway investors, excluding a one-time charge of $10.2 billion to account for a recent European Union court decision that lumped the Cupertino, California, company with a huge bill for back taxes.
Apple earned $14.74 billion, or 97 cents per share, a 36% decrease from the same time last year. If not for the one-time tax hit, Apple said it would have earned $1.64 per share — topping the $1.60 per share predicted by analysts, according to FactSet Research. Revenue rose 6% from last year to $94.93 billion, about $400 million more than analysts forecast.
But investors evidently were hoping for an even better quarter and appeared disappointed by an Apple forecast that implied its revenue for the October-December quarter covering the holiday shopping season might not grow as robustly as analysts envisioned. Apple’s stock price shed about 2% in Thursday’s extended trading, leaving the shares hovering around $221 — well below their peak of about $237 reached in mid-October.
The latest quarterly results captured the first few days that consumers were able to buy a new iPhone 16 line-up that included four different models designed to handle a variety of AI wizardry that the company is marketing as “Apple Intelligence.” The branding is part of Apple’s effort to distinguish its approach to AI from rivals such as Samsung and Google that got a head start on bringing the technology to smartphones.
Even though the iPhone 16 was specifically built with AI in mind, the technology didn’t become available until Apple released a free software update earlier this week that activated its first batch of technological tricks, including a feature designed to make its virtual assistant Siri smarter, more versatile and more colorful. And those improvements are only available in the U.S. for now.
“This is just the beginning of what we believe generative AI can do,” Apple CEO Tim Cook told analysts during a Thursday conference call.
Cook said plans to expand the AI iPhone features into other countries in December, as well as roll out other software updates that will inject even more of the technology in the iPhone 16 and two high-end iPhone 15 models that are also equipped with the special computer chips needed for the slick new features. The December expansion will include an option to connect with OpenAI’s ChatGPT to take advantage of technology that Apple isn’t making on its own. More languages
Investors are betting that as Apple’s AI becomes more broadly available, it will prompt the hundreds of millions of consumers who are using older iPhones to upgrade to newer models in order to get their hands on the latest technology.
“We believe it’s a compelling upgrade reason,” Cook asserted. But Investing.com analyst Thomas Monteiro believes iPhone sales would already be accelerating at a faster pace if consumers were blown away by Apple’s AI technology, increasing the pressure on the company “to do an overall better job to impress the public.”
NEW YORK — Donald Trump’s Truth Social is now worth more than Elon Musk’s X, thanks to a recent run-up in the shares of the parent company of the former president’s social media platform.
Trump Media & Technology Group is now valued at over $10 billion after its shares more than quadrupled since late September. Meanwhile, X Holdings is valued at around $9.4 billion, based on the most recent value the investment group Fidelity assigned to its stake in the company formerly known as Twitter.
The stock of Trump Media, or TMTG, tends to move more with Trump’s re-election odds than on its own profit prospects and investors have seen his chances of retaking the presidency improving of late. On Tuesday, the stock rose almost 9% to close at $51.51, on top of a 21.6% gain Monday. The stock was moving so sharply that trading was briefly halted several times during the morning. The stock had dropped to roughly $12 late last month.
Trump created TMTG after he was banned from Twitter and Facebook following the Jan. 6, 2021, Capitol riot. He owns about 57% of the company but has no role in running it.
When Musk took over Twitter in October of 2022, the company was valued at around $44 billion. At that time, Fidelity Investments valued its stake at $19.7 million. In a recent regulatory filing, Fidelity’s Blue Chip Growth fund said its stake in X Holdings was worth about $4.2 million.
Other companies TMTG is now bigger than include: Caesars Entertainment, Match Group, Walgreens Boots Alliance and Hasbro, the maker of the Monopoly game.
Musk has become one of Trump’s most prominent supporters in his bid to get re-elected. The world’s richest man, Musk has committed more than $70 million to boost Trump and has recently held a number of town halls in support of the former president.
TOKYO — Asian shares mostly rose Tuesday after U.S. stocks closed broadly higher with gains in Big Tech companies offsetting a skid in oil-and-gas stocks.
Japan’s benchmark Nikkei 225 added 0.8% to finish at 38,903.68. Australia’s S&P/ASX 200 gained 0.3% to 8,249.20. South Korea’s Kospi added 0.2% to 2,617.80. Hong Kong’s Hang Seng edged up 0.2% to 20,648.51, while the Shanghai Composite slipped 1.1% to 3,286.41.
In Japan, the government reported that unemployment stood at 2.4% last month, marking an improvement of 0.1 percentage point, and the second straight month of recovery. The continuing weak yen is helping hold up Japanese stocks. In currency trading, the U.S. dollar slipped to 153.06 Japanese yen from 153.23 yen. The euro cost $1.0813, inching down from $1.0817.
On Wall Street, the S&P 500 rose 0.3%. The main measure of the U.S. stock market was coming off its first losing week in the last seven, but it’s still near its all-time high set earlier this month.
The Dow Jones Industrial Average rose 0.6%, while the Nasdaq composite finished 0.3% higher. It’s now within 0.4% of its all-time high set in July.
Several Big Tech stocks, including Apple and Meta Platforms, helped lead the way. Five of the behemoths known as the “Magnificent Seven” are on this week’s schedule to report their latest profits. These high-flying stocks have been at the forefront of Wall Street for years and have grown so big that their movements can singlehandedly shift the S&P 500.
After suffering a summertime swoon on worries that their stock prices had risen too quickly when compared with their profits, Alphabet, Meta Platforms, Microsoft, Apple and Amazon are under pressure to deliver more big growth.
But stocks in the oil-and-gas industry dropped, hurt by the sinking price of oil. Exxon Mobil fell 0.5% and ConocoPhillips fell 1.2%.
In energy trading in Asia Tuesday, benchmark U.S. crude fell 18 cents to $67.20 a barrel. Brent crude, the international standard, declined 16 cents to $71.26 a barrel.
On Monday, a barrel of benchmark U.S. crude fell 6.1%, and Brent crude slid 6.1%. That was the first trading for them since Israel attacked Iranian military targets on Saturday, in retaliation for an earlier barrage of ballistic missiles. Israel’s attack was more restrained than some investors had feared it could be, and it raised hopes that a worst-case scenario may be avoided.
Beyond the violence that is taking a human toll, the worry in financial markets is that an escalating war in the Middle East could cut off the flow of crude from Iran, which is a major oil producer. Such worries had sent the price of Brent crude up to nearly $81 per barrel in early October, despite signals that plenty of oil is available for the global economy. It’s since fallen back below $72.
Financial markets are also dealing with the volatility that typically surrounds a U.S. presidential election, with Election Day one week away. Markets have historically been shaky heading into an election, only to calm afterward regardless of which party wins.
The trend affects both the stock and the bond markets. In the bond market, Treasury yields were ticking higher to tack more gains onto their sharp rise for the month so far.
The yield on the 10-year Treasury rose to 4.28% from 4.24% late Friday. That’s well above the roughly 3.70% level where it was near the start of October.
But it’s also forcing traders to ratchet back forecasts for how deeply the Federal Reserve will cut interest rates, now that it’s just as focused on keeping the economy humming as getting inflation lower. With bets diminishing on how much the Fed will ultimately cut rates, Treasury yields have also been given back some of their earlier declines.
That means the U.S. jobs report on the schedule for Friday could end up being the market’s main event, even bigger than the Big Tech profit reports. Investors want to see more evidence of solid hiring to keep alive the perfect-landing hopes for the economy.
All told, the S&P 500 rose 15.40 points to 5,823.52. The Dow added 273.17 points to close at 42,387.57. The Nasdaq rose 48.58 points to 18,567.19.
NEW YORK — U.S. stocks are approaching records Monday ahead of a big week for profit reports from Big Tech stocks. Oil prices, meanwhile, are tumbling toward their worst loss in more than a year.
The S&P 500 was 0.4% higher in afternoon trading. The main measure of the U.S. stock market is coming off its first losing week in the last seven, but it’s still near its all-time high set earlier this month.
The Dow Jones Industrial Average was up 280 points, or 0.7%, as of 1:10 p.m. Eastern time, while the Nasdaq composite was 0.5% higher and flirting with its own record set in July.
Several Big Tech stocks helped lead the way, and five of the behemoths known as the “Magnificent Seven” are on this week’s schedule to report their latest profits. These high-flying stocks have been at the forefront of Wall Street for years and have grown so big that their movements can singlehandedly shift the S&P 500.
After suffering a summertime swoon on worries that their stock prices had risen too quickly when compared with their profits, Alphabet, Meta Platforms, Microsoft, Apple and Amazon are under pressure to deliver more big growth.
Another member of the Magnificent Seven, Tesla, soared to one of the best days in its history last week after reporting a better profit than analysts expected.
Monday’s gains for Big Tech helped offset drops for stocks in the oil-and-gas industry, which were hurt by the sinking price of oil. Exxon Mobil’s 0.6% drop and ConocoPhillips’ slide of 1.4% were two of the heaviest weights on the S&P 500.
A barrel of benchmark U.S. crude fell 5.7%, and Brent crude, the international standard, slid 5.7%. It was the first trading for them since Israel attacked Iranian military targets on Saturday, in retaliation for an earlier barrage of ballistic missiles. Israel’s attack was more restrained than some investors had feared it could be, and it raised hopes that a worst-case scenario may be avoided.
Beyond the violence that is taking a human toll, the worry in financial markets is that an escalating war in the Middle East could cut off the flow of crude from Iran, which is a major oil producer. Such worries had sent the price of Brent crude up to nearly $81 per barrel in early October, despite signals that plenty of oil is available for the global economy. It’s since fallen back below $72.
Financial markets are also dealing with the volatility that typically surrounds a U.S. presidential election, with Election Day fast approaching in two Tuesdays. Markets have historically been shaky heading into an election, only to calm afterward regardless of which party wins.
The trend affects both the stock and the bond markets. In the bond market, Treasury yields were ticking higher to tack more gains onto their sharp rise for the month so far.
The yield on the 10-year Treasury rose to 4.29% from 4.24% late Friday. That’s well above the roughly 3.70% level where it was near the start of October.
But it’s also forcing traders to ratchet back forecasts for how deeply the Federal Reserve will cut interest rates, now that it’s just as focused on keeping the economy humming as getting inflation lower. With bets diminishing on how much the Fed will ultimately cut rates, Treasury yields have also been given back some of their earlier declines.
That means the U.S. jobs report on the schedule for Friday could end up being the market’s main event, even bigger than the Big Tech profit reports. Investors want to see more evidence of solid hiring to keep alive the perfect-landing hopes for the economy.
Such data has supplanted inflation reports, which used to be the most important for Wall Street every month but have waned as inflation seems to be heading toward the Fed’s target of 2%.
Yields have also climbed as investors have seen former President Donald Trump’s chances of re-election improving. Economists say a Trump win could help push inflation higher in the long term, and worsening inflation could push the Fed to hike interest rates.
Trump Media & Technology Group, the company that tends to move more with Trump’s re-election odds than on its own profit prospects, jumped 20.3% Monday to $46.87. The parent company of Trump’s Truth Social platform has been rallying since hitting a bottom of roughly $12 in late September, though it’s still well below its perch above $60 reached in March.
Robinhood Markets rose 3.7% after it said it would begin allowing some of its customers to trade contracts based on whether they think either Trump or Vice President Kamala Harris will win the 2024 election.
Delta Air Lines was another winner and rose 3.8% after suing CrowdStrike, claiming the cybersecurity company had cut corners and caused a worldwide technology outage that led to thousands of canceled flight in July.
In stock markets abroad, Japan’s Nikkei 225 rose 1.8% as the value of the Japanese yen sank after Japanese Prime Minister Shigeru Ishiba’ s ruling coalition lost a majority in the 465-seat lower house in a key parliamentary election Sunday.
Stock indexes were mostly higher across much of the rest of Asia and in Europe.
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AP Business Writers Yuri Kageyama and Matt Ott contributed.
NEW YORK — U.S. stocks are falling Wednesday as some more steam comes out of Wall Street’s huge, record-breaking rally.
The S&P 500 was 1% lower in afternoon trading. It’s coming off two small losses since setting an all-time high on Friday and is on track for its first three-day losing streak since early September. The pullback follows a superb run where the index rallied to six straight winning weeks, its longest such streak of the year.
The Dow Jones Industrial Average was down 431 points, or 1%, as of 1:11 p.m. Eastern time, and the Nasdaq composite was 1.7% lower as Big Tech stocks were among the market’s heaviest weights.
McDonald’s helped pull the market lower and dropped 5.3% after federal health officials linked its Quarter Pounder burgers with an E. coli outbreak that’s affected at least 49 people in 10 states. Investigators are still trying to find what specific ingredient is contaminated, and the Centers for Disease Control and Prevention said McDonald’s stopped using fresh slivered onions and quarter pound beef patties in several states while the investigation is ongoing.
Coca-Cola fell 2% even though it reported stronger profit and revenue for the latest quarter than analysts expected. The company benefited from higher prices for its products, but a lot of focus was on how much product the company shipped during the quarter, and that fell short of some estimates.
Boston Scientific also weakened despite delivering better-than-expected quarterly results. It fell 2.1% after saying it’s temporarily pausing its trial of a treatment for persistent atrial fibrillation to assess “a few unanticipated observations.” The medical technology company said it intends to resume enrollment in the near term.
The company reported a loss of more than $6 billion for the latest quarter, as it waits to see the results of a vote by machinists later in the day that could end a strike that’s crippled aircraft production for more than a month. Boeing stock has lost 40% this year.
Helping to keep the losses for indexes in check was AT&T, which rose 3.2% after reporting stronger profit for the latest quarter than analysts expected
Texas Instruments climbed 3.6% after the semiconductor company reported stronger profit and revenue than analysts expected. While revenue from industrial users declined from the prior quarter, CEO Haviv Ilan said all other end markets grew.
Northern Trust rallied 7.8% after likewise topping analysts’ estimates for profit and revenue in the latest quarter.
U.S. stocks have generally been slowing their record-breaking momentum this week under increasing pressure from rising Treasury yields.
The yield on the 10-year Treasury rose again Wednesday to 4.23% from 4.21% late Tuesday and from just 4.08% Friday. Higher yields for Treasurys can make investors less willing to pay high prices for stocks, which critics say already look too expensive after they rose faster than corporate profits.
Traders are now largely expecting the Fed to cut its main interest rate by half a percentage point more through the end of the year, according to data from CME Group. A month ago, some of those same traders were betting on the federal funds rate ending the year as much as half a percentage point lower than that.
In stock markets abroad, Japan’s Nikkei 225 slipped 0.8% despite a surge for Tokyo Metro Co.’s stock in Japan’s largest market debut since SoftBank Corp. went public in 2018.
Chinese markets rose for a second day after the central bank cut its one-year and five-year Loan Prime Rates on Monday. Indexes rose 1.3% in Hong Kong and 0.5% in Shanghai, while European markets were modestly lower.
BANGKOK — World shares have mostly gained after China’s central bank released plans for supporting the stock market through share repurchases by companies and major shareholders.
European markets opened mostly higher, with Germany’s DAX up 0.2% at 19,623.37. In Paris, the CAC 40 gained 0.4% to 7,615.72. Britain’s FTSE 100 slipped 0.1% to 8,376.04.
The European Central Bank on Thursday cut its main interest rate by a quarter of a percentage point, helping send shares higher.
The future for the S&P 500 was up less than 0.1% while that for the Dow Jones Industrial Average was little changed.
Beijing also reported FRiday that the Chinese economy slowed further in the last quarter, which spurred expectations the government will ramp up its latest stimulus efforts. The world’s second-largest economy expanded at a 4.6% annual pace in July-September, down slightly from 4.7% in the previous quarter.
Growth so far this year has averaged to 4.8%, below the official target of about 5%, as weakness in the property market has continued to weigh on demand.
Meanwhile, the central bank issued guidelines for state banks to provide loans to companies and major shareholders for stock repurchases as part of an effort to stabilize China’s share markets, which have languished in recent years.
The loans, which can be made only by 21 designated financial institutions, will have a maximum interest rate of 2.25%, the People’s Bank of China said in a statement that underscored plans for strict oversight of the effort to support the markets.
The news helped drive a rally in Shanghai, where the Composite index gained 2.9% to 3,261.56. The benchmark for the smaller market in the southern city of Shenzhen jumped 4.1%.
Shanghai’s benchmark has gained 9% in the past three months, though it had surged much higher last month with the release of new measures to counter the slowdown, before falling back as investors registered their disappointment over a lack of big government spending initiatives.
Hong Kong’s Hang Seng index gained 3.6% to 20,791.20.
Also Friday, China’s large state-run banks cut their deposit rates, to 0.1% from 0.15% for demand deposits and to 1.1% from 1.35% for longer term deposits.
Elsewhere in Asia, Tokyo’s Nikkei 225 edged 0.2% higher to 38,981.75 and the Kospi in Seoul shed 0.6% to 2,593.82. Australia’s S&P/ASX 200 gave up 0.9% to 8,283.20.
The Taiex in Taiwan gained 1.9% and the SET in Bangkok was up 0.3%. India’s Sensex rose 0.2%.
On Thursday, U.S. stocks drifted around their record heights following the latest signals that the U.S. economy continues to hum.
The S&P 500 finished virtually unchanged at 5,841.47 after flirting with its all-time high for much of the day. The Dow Jones Industrial Average added 0.4% to 43,239.05, besting its own record set the day before. The Nasdaq composite added less than 0.1% to 18,373.61.
Nvidia and other companies in the chip industry were some of the market’s strongest after global heavyweight Taiwan Semiconductor Manufacturing Co. reported bigger profit for the latest quarter than analysts expected.
In the bond market, Treasury yields rose following the latest encouraging reports on the U.S. economy.
U.S. retailers made more in sales in September than in August, and underlying growth trends within the data were better than economists expected.
A separate report, meanwhile, said fewer U.S. workers applied for unemployment benefits last week, a signal that layoffs nationwide are relatively low and aren’t damaging the job market.
Such data bolster the hope that the economy could make a perfect escape from the worst inflation in generations, one that ends without a recession that many investors had seen as nearly inevitable. And with the Federal Reserve now cutting interest rates to keep the economy humming, the expectation among optimists is that stocks can rise even further.
Critics, meanwhile, are warning that stock prices look too expensive given how much faster they’ve climbed than corporate profits.
In other dealings early Friday, U.S. benchmark crude oil was unchanged at $70.67 per barrel. Brent crude, the international standard, was down 3 cents at $74.42 per barrel.
The dollar fell to 150.11 Japanese yen from 150.21 yen. The euro rose to $1.0844 from $1.0827.
NEW YORK (AP) — Wall Street pulled back from its records on Tuesday after the price of crude oil tumbled and technology stocks faltered.
The S&P 500 fell 0.8%, a day after setting an all-time high for the 46th time this year. The Dow Jones Industrial Average dropped 324 points, or 0.8%, and the Nasdaq composite sank 1%.
Exxon Mobil dropped 3%, and energy stocks fell to some of Wall Street’s sharpest losses after oil prices tumbled more than 4%. A barrel of Brent crude, the international standard, has fallen back below $75 from more than $80 last week.
Crude prices have been weakening as China’s flagging economic growth raises concerns about demand for oil. At the same time, worries have receded about Israel possibly attacking Iranian oil facilities as part of its retaliation against Iran’s missile attack early this month. Iran is a major producer of crude, and a strike could upend its exports to China and elsewhere.
Markets are off to a mixed start. More from AP’s Seth Sutel.
Nvidia was the heaviest weight on the S&P 500 and fell 4.5%. It’s a cooldown for the chip company, whose stock is still up 166.2% for the year so far on euphoria about the profits created by the boom around artificial-intelligence technology.
Stocks for companies across the chip industry fell after Dutch supplier ASML reported its latest quarterly results. CEO Christophe Fouquet said AI continues to offer strong upside potential, but “other market segments are taking longer to recover,” and ASML’s stock trading in the United States fell 16.3%.
Also dragging on the U.S. stock market was UnitedHealth Group. The insurer dropped 8.1% despite reporting better results for the latest quarter than analysts expected. It lowered the top end of its forecasted range for profit over the full year.
Helping to keep the S&P 500 and Dow close to their records set on Monday were gains for several financial companies following better-than-expected profit reports for the summer.
Charles Schwab jumped 6.1%. More customers opened brokerage accounts at the company, helping to bring its total client assets to a record $9.92 trillion. Bank of America added 0.5%, and CEO Brian Moynihan said his company benefited from higher average loans and fees for investment banking and asset management.
Walgreens Boots Alliance was another winner, up 15.8%, after topping analysts’ forecasts. The drugstore chain also said it will close about 1,200 locations over the next three years as it tries to turn around its struggling U.S. business.
Chipmaker Wolfspeed jumped 21.3% to trim its loss for the year to 68.3% after the Biden-Harris administration announced plans to provide up to $750 million in direct funding to the company. The money will support its new silicon carbide factory in North Carolina that makes the wafers used in advanced computer chips.
In the bond market, trading of Treasurys resumed after a holiday on Monday, and yields sank following a weaker-than-expected report on manufacturing in New York state.
The yield on the 10-year Treasury fell to 4.03% from 4.10% late Friday. Manufacturing has been one of the areas of the U.S. economy hurt most by high interest rates caused by the Federal Reserve in its efforts to slow the economy enough to stamp out high inflation.
Now, though, the Fed has begun cutting interest rates as it’s widened its focus to include keeping the economy humming instead of just fighting high inflation. It looks set to continue cutting rates through next year, which would ease the brakes further off the economy.
Recent reports showing the U.S. economy remains stronger than expected have raised optimism that the Fed can pull off a perfect landing where it gets inflation down to 2% without causing a recession that many had thought would be necessary.
Because of expectations for continued growth for the U.S. economy, as well as the boost that lower rates can give to corporate profits and prices for stocks, strategists at UBS raised their forecast for how high the S&P 500 could go this year and next.
Led by Jonathan Golub, they’re calling for the S&P 500 to rise to 5,850 by the end of the year, up from their prior forecast of 5,600.
The S&P 500 finished Tuesday at 5,815.26 after falling 44.59 points. The Dow dropped 324.80 to 42,740.42, and the Nasdaq composite sank 187.10 to 18,315.59.
In stock markets abroad, Chinese stocks fell sharply as doubts continue about whether the government will offer enough fiscal stimulus to prop up the world’s second-largest economy.
Stocks in Shanghai fell 2.5%, and Hong Kong’s Hang Seng index dropped 3.7%.
Indexes were mixed elsewhere in Asia and in Europe.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
NEW YORK — U.S. stocks are rising toward records Friday as big banks rally on a rush of reassuring profit reports.
The S&P 500 was 0.4% higher in afternoon trading and on track to top its all-time high set earlier this week. The Dow Jones Industrial Average was up 268 points, or 0.6%, and also heading toward a record, as of 12:56 p.m. Eastern time. The Nasdaq composite was lagging the market with a gain of 0.2% after a slide for Tesla kept it in check.
Wells Fargo jumped 6% after reporting stronger profit for the latest quarter than analysts expected. It benefited from better results from its venture-capital investments and higher fees for investment-banking services, among other things.
Banks and other financial giants traditionally kick off each earnings reporting season, and BlackRock and Bank of New York Mellon also climbed after delivering results that topped analysts’ forecasts. BlackRock, the investment giant, said it ended the summer managing a record $11.5 trillion in total assets for its customers.
JPMorgan Chase, the nation’s biggest bank, rose 4.9% and was the strongest single force pushing upward on the S&P 500 after it reported a milder drop in profit than analysts feared. CEO Jamie Dimon said the bank is still buying back shares of its stock to send cash to investors, but the pace is modest “given that market levels are at least slightly inflated.”
The gains for banks helped make up for the drag of Tesla, which tumbled 7.7% and was the heaviest weight on the market. The electric-vehicle maker unveiled its long-awaited robotaxi on Thursday night, but critics highlighted a lack of details about its planned rollout.
Following the unveiling of the “Cybercab,” potential rival Uber Technologies jumped 9.6% and was one of the strongest forces lifting the S&P 500. Lyft rose even more, 10.1%.
Another automaker, Stellantis, saw its European-traded shares sink 2.8% after it announced some significant leadership changes, including the timing of CEO Carlos Tavares’ retirement. Its chief financial officer is also departing as the company formed by the merger of PSA Peugeot and Fiat Chrysler struggles to revive sales in North America.
In the bond market, Treasury yields were holding relatively steady after the latest updates on inflation at the wholesale level and on sentiment among U.S. consumers.
Prices paid by producers were 1.8% higher in September than a year earlier. That was an improvement from August’s year-over-year inflation level, but not as much as economists expected. Analysts said it likely helped calm worries stirred a day earlier, when a separate report showed inflation at the consumer level wasn’t cooling as quickly as economists expected.
A separate report suggested sentiment among U.S. consumers is weakening by more than economists feared. But the preliminary reading’s decline was still within the margin of error, according to Joanne Hsu, director of the University of Michigan’s Surveys of Consumers.
After Friday’s reports, traders were holding onto their bets that the Federal Reserve would cut its main interest rate by a quarter of a percentage point at its next meeting, according to data from CME Group.
They’ve pared back their expectations from earlier this month, when some were betting on the possibility for another larger-than-usual cut of half a percentage point in November. A run of stronger-than-expected data on the economy wiped out such calls.
Regardless of how much the Fed cuts rates by at its next meeting, the longer-term trend for interest rates is still downward, according to Solita Marcelli, chief investment officer Americas, at UBS Global Wealth Management. That should benefit stock prices generally.
The yield on the 10-year Treasury was holding at 4.07%, where it was late Thursday. The two-year yield, which more closely tracks expectations for the Fed’s upcoming moves, edged down to 3.93% from 3.96%.
In markets abroad, stocks fell 2.5% in Shanghai for their latest sharp swing ahead of a briefing scheduled for Saturday by China’s Finance Ministry. Investors hope it will unveil a big stimulus plan for the world’s second-largest economy.
South Korea’s Kospi slipped 0.1% after its central bank cut interest rates for the first time in more than four years in hopes of boosting its economy.
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AP Business Writers Matt Ott and Zimo Zhong contributed.
