Stocks Plummet, Treasury Yields Jump on Another Hot Inflation Report
Equity Indexes Wrap: Real Estate Leads Indexes Lower; Discount Stores, Energy Gain
4 hr 15 min ago
The Dow
Walmart (WMT) climbed 1.4%, one of several low-cost retailers to advance following Wednesday’s hotter-than-anticipated inflation data.
Chevron (CVX) ticked up 0.4%, buoyed by rising oil prices as tensions in the Middle East simmered.
Home Depot (HD) shares slumped 3.1% after Wednesday’s inflation data raised concerns higher-for-longer interest rates could delay a rebound in the U.S. housing market.
Boeing (BA) fell 2% a day after the New York Times reported a whistleblower raised concerns about the safety of its Dreamliner 787s, adding to the jet maker’s woes.
The S&P 500
Axon Enterprise (AXON) gained 2.3% after Needham raised its price target on the stock, citing increased demand for its security products.
Nvidia (NVDA) rose 2% alongside fellow AI beneficiary Constellation Energy Group (CEG), which gained 1.6%.
Dollar Tree (DLTR) ticked up 1.1% and Dollar General (DG) advanced 0.8%.
Deckers Outdoor (DECK) fell 6.7% after Truist downgraded the stock and lowered its price target, citing waning demand for its Hoka running shoes.
Real estate stocks tumbled amid concerns about higher interest rates following Wednesday’s inflation report. Extra Space Storage (EXR) fell 6.5%, while homebuilder D.R. Horton (DHI) dropped 6.4%, and premier office property developer Boston Properties (BXP) shed 6.1%.
Delta Air Lines (DAL) gave up early gains to close down 2.5% despite beating earnings estimates on strong travel demand.
The Nasdaq 100
Meta (META) ticked up 0.6% as it unveiled the latest version of its custom AI chip, becoming the latest tech giant to ramp up efforts to reduce its reliance on Nvidia and cash in on enormous AI investments.
Commercial real estate analytics provider CoStar Group (CSGP) followed other real estate stocks lower, falling 5.3%.
Most semiconductor stocks fell, including Advanced Micro Devices (AMD), down 2.1%, and Marvell Technology (MRVL), which fell 2.6% ahead of its AI event on Thursday.
Roblox Stock Rises as Online Gaming Platform Teams with PubMatic for Video Ads
4 hr 45 min ago
Roblox (RBLX) shares were higher Wednesday afternoon, bucking a broader downturn for U.S. equities, after the online gaming platform struck a deal with ad tech firm PubMatic (PUMB) that will provide for media purchases of Roblox’s video advertising inventory when it becomes available later this year.
PubMatic said the partnership will allow more brands easy access to Roblox’s more than 71 million daily active users, and give the company “scaled access to premium brand advertising demand.”
In November, Roblox began experimenting with video ads, explaining that it expects they will “increase developer payouts and advertiser value per impression.”
Financial terms of the agreement were not disclosed.
Roblox shares were up 1.3% at $39.61 late in the session Wednesday. The stock has lost about 15% of its value over the past 12 months. PubMatic shares were down 3.4% in late trading.
TSMC Revenue Jumps in Q1, Topping Expectations Amid AI-Fueled Demand Boom
5 hr 42 min ago
Taiwan Semiconductor Manufacturing Company (TSM) on Wednesday reported quarterly revenue that came in higher than analysts’ expectations, and just above the midpoint of the company’s guidance.
TSMC, which will release a full earnings report next week, has seen a boom in demand for its products, which it supplies to a number of tech giants including Apple (AAPL) and Nvidia (NVDA), thanks in part to the artificial intelligence (AI) craze of the last year.
The company reported revenue of 195.21 billion New Taiwan dollars ($6.07 billion) for March, up 34% from the year-earlier month. For the quarter, revenue increased 17% to TWD592.64 billion ($18.42 billion), ahead of analysts’ expectation of TWD580 billion ($18.03 billion), according to estimates compiled by Visible Alpha, and also above the midpoint of TSMC’s guidance of between $18 billion and $18.8 billion.
American depositary receipts (ADRs) of the Taiwanese company were up 0.3% at $145.87 Wednesday afternoon, after rising as high as $148.43 earlier in the session. Earlier this week, they gained on the announcement that TSMC would receive up to $6.6 billion in CHIPS Act funding to expand its plans to three factories at an Arizona facility it began constructing in 2021.
Macy’s Appoints Activist Investor Board Picks, Ending Proxy Fight
6 hr 55 min ago
Macy’s (M) on Wednesday ended a proxy fight with activist investor Arkhouse Management by agreeing to calls for a board shakeup.
Macy’s announced that it had appointed a pair of new independent directors, Richard Clark and Richard Markee, both of whom were Arkhouse nominees. The retailer added that with that decision, Arkhouse has agreed to withdraw its candidates for board seats and the shareholder proposals it wanted voted on at Macy’s annual meeting of shareholders.
The move is expected to bring the biggest U.S. department store chain closer to being taken private by Arkhouse and its partner, Brigade Capital Management. The company noted that it is “continuing to engage with Arkhouse and Brigade regarding their proposal to acquire the Company.”
Shares of Macy’s were little changed Wednesday afternoon and are down about 2% for 2024.
SoundHound AI Sinks Following Stock Sale Announcement
8 hr 4 min ago
The recent big run-up of SoundHound AI (SOUN) shares continued to erode Wednesday after the provider of artificial intelligence (AI) products for speech and sound recognition announced a stock sale.
SoundHound AI reported that it has entered into an agreement with five financial institutions to sell up to $150 million worth of its shares from time to time.
In March, SoundHound shares had soared more than 300% from the beginning of the year after AI darling Nvidia (NVDA) disclosed it had taken a stake in the company.
However, they have steadily slipped over the last month on concerns about the firm’s financial footing. Still, even with Wednesday’s 9% decline to $4.40, shares have more than doubled in 2024.
Homebuilders, Real Estate Hit Hard By Inflation Data
8 hr 49 min ago
Homebuilders and real estate investment trusts tanked Wednesday after stubbornly high inflation data amplified concerns interest rates will remain elevated for some time.
Higher-for-longer interest rates are expected to weigh on both the residential and commercial real estate markets. The housing market entered a deep freeze last year as soaring mortgage rates put homeownership out of reach for nearly all first-time buyers. Rates had retreated in recent months—in part in anticipation of impending rate cuts—boosting hopes of a busy spring selling season.
Homebuilders like D.R. Horton (DHI) and Lennar (LEN) were some of the S&P 500’s worst-performing stocks on Wednesday morning, falling 4.4% and 4%, respectively.
Commercial real estate has also struggled under the weight of higher rates and historically low post-Covid occupancy rates. The prospect of lower interest rates eased some of that pressure for property owners facing pressure to refinance loans as pre-Covid leases come up for renewal in the next couple of years.
Boston Properties (BXP), a developer of high-end workplaces, fell 5% Wednesday morning, while CoStar Group (CSGP), a provider of commercial real estate analytics, slid 5.1%.
Delta Soars on Earnings Beat, Optimistic Guidance on Strong Demand for Travel
10 hr 16 min ago
Delta Air Lines (DAL) shares rose in early trading Wednesday after the carrier reported record first-quarter revenue, with adjusted income and earnings per share (EPS) figures also topping expectations.
Delta posted an 8% year-over-year revenue increase to $13.75 billion, along with adjusted net income of $288 million, or 45 cents per share, well above analyst estimates compiled by Visible Alpha of $13.15 billion, $230.8 million, and 36 cents per share, respectively.
Executives said they expect the strong travel numbers they’ve seen so far this year to continue into the busier summer travel season, as Delta reported a load factor—the percentage of available seating capacity that is filled with passengers—of 83% for the quarter, up from 81% last year and within the company’s pre-pandemic averages of 82% to 88%.
Delta stock was up about 2.8% at $48.65 early in the session Wednesday. It is up nearly 21% on the year and 43% over the last 12 months.
Stocks Making the Biggest Moves Premarket
10 hr 54 min ago
Gains:
- Delta Air Lines Inc. (DAL): Shares of the carrier rose more than 3% after it reported record first-quarter revenue and higher-than-expected profit.
- Roblox Inc. (RBLX): Shares of the online video gaming company rose more than 1% after it hired ad tech company PubMatic (PUBM) to ramp up its nascent advertising business.
Losses:
- Monday.com Inc. (MNDY): Shares of the project management software company slipped about 6% after analysts at Citi downgraded the stock to neutral, citing concerns about demand and pricing.
- Vistra Corp. (VST): Shares of the utility fell about 4% after it priced a $1.5 billion senior note offering.
- Macy’s Inc. (M): Shares of the department store fell about 2% after the company said it had settled a proxy fight with activist investors Arkhouse Management and agreed to add two Arkhouse nominees to its board of directors.
Futures Fall Off a Cliff Following Sticky March Inflation Data
11 hr 35 min ago
Dow futures plummeted to trade 0.9% lower immediately following March’s CPI release.
S&P 500 futures sank 1.2%.
Nasdaq 100 futures slumped 1.4%.
Stock Futures Tick Up Ahead of March CPI
11 hr 56 min ago
Futures contracts connected to the Dow Jones Industrial Average were up about 0.3% in premarket trading on Wednesday.
S&P 500 futures were up a little over 0.2%.
Nasdaq 100 futures also traded about 0.2% higher a little over an hour before markets opened.
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