Close Menu
Finance

Stock prices fall as the new quarter begins

Max SmithBy No Comments9 Mins Read


U.S. stocks started the second quarter of 2024 on shaky footing Monday.

The S&P 500 (^GSPC) fell 0.4% and the Dow Jones Industrial Average (^DJI) fell 0.7%. The tech-heavy Nasdaq Composite Index (^IXIC) fell 0.2%, erasing early gains.

Wall Street started 2024 on a high note. The benchmark S&P 500 index has set 22 new records in closing prices so far this year, as part of its best first quarter since 2019. Meanwhile, all three major averages have increased for five consecutive months.

Although markets were closed on Friday, this week's closely watched data, the Personal Consumption Expenditure Price Index, served to boost expectations for rate cuts this year. The index includes “core” PCE, the Fed's preferred measure of inflation. The report said core PCE rose 0.3% from the previous month, lower than economists expected. Fed Chairman Jerome Powell said Friday that the statistics were “in line” with what the Fed is looking for.

These statistics strengthened investors' expectations for a June interest rate cut. About two-thirds of investors are pricing in a rate cut at the Fed's June meeting, up from about 55% last Thursday, according to the CME FedWatch tool.

The macroeconomic highlight of the first week of the second quarter will be Friday's jobs report, which will be another important signal for the Fed.

live10 updates

  • This is what you should see at McDonald's

    true story.

    After burning 3,251 calories on Friday (taking two 1-hour bootcamp training classes), I decided to reach for an unusual fast food treat. McDonald's (MCD) spicy chicken sandwich and diet soda. I immediately threw away the receipt without even looking at the prices of the items on the menu board. But I remember leaving there feeling like I had spent too much money on a chicken sandwich and diet soda.

    So today's new McDonald's note from Bernstein analyst Danilo Gargiulo comes at a good time.

    Gargiulo noted that McDonald's has been raising prices more aggressively over the past year to combat inflation. As a result, a trip to McDonald's may no longer be affordable for low-income consumers, and transportation may suffer. In this region of McDonald's inflation, home-cooked meals are the go-to for this group.

    How aggressive McDonald's has been in raising prices is best illustrated in the graph below created by Gargiulo.

    Given the price of these iconic fast-food burgers, perhaps Conagra's (CAG, which will report earnings later this week) frozen dinners are a more economical option for most people.

    Inflation burger.Inflation burger.

    Inflation burger. (Bernstein)

  • Cocoa’s rally continues, hitting new high of $10,193

    Cocoa (CC=F) futures hit a new all-time high on Monday, hitting an all-time high of $10,193 per tonne during trading.

    The product surpassed the $10,000 level last week. In the past year prices he has increased by more than 250%.

    Bad weather and crop damage in West Africa is fueling a massive spike in cocoa prices. Analysts also point out that the daily price fluctuations are large and there may be speculative trading.

    Philip Strible, chief market strategist at Blue Line Futures, told Yahoo Finance in a recent interview: “What really needs to happen is that exchanges need to stop and rein in the speculation that's happening in the market. That's true,” he said.

    “We need to see West Africa's crops get better and we need to see some of that demand actually decline. So this problem is probably not going to go away anytime soon.”

  • United Airlines asks pilots to take time off after Boeing delivery delays

    United Airlines (UAL) asked pilots to take voluntary unpaid leave in May after delays in deliveries of Boeing (BA) aircraft.

    A spokesperson for the company told Yahoo Finance: “Due to recent Boeing delivery delays, we have confirmed that our expected block times for 2024 have been shortened, and in order to reduce overstaffing, we have announced a voluntary pilot training program for pilots in May to reduce overstaffing. We offer a variety of programs.”

    Boeing's recent safety issues are impacting delivery schedules for airlines. Last month, United Airlines CEO Scott Kirby said the airline had asked Boeing to halt production of its still-certified 737 Max 10 aircraft. Instead, the airline plans to use smaller aircraft alongside Airbus aircraft.

    United Airlines shares rose more than 1% on Monday. The stock price has increased about 18% since the beginning of the year.

  • Gold trades at new highs as investors bet on interest rate cuts

    Gold (GC=F) hit a new high on Monday, following a series of records in March. Precious metal futures rose more than 1% to $2,265 an ounce.

    Gold prices are rising on expectations that Federal Reserve officials will cut interest rates this year.

    The Fed's preferred inflation measure released on Friday was in line with expectations. The print was interpreted by investors as another sign that a rate cut could come as early as June.

    Gold is up more than 6% since the beginning of the year.

  • Stocks mixed as Q2 begins

    Stocks were mixed on Monday as the second quarter of 2024 begins and a new month of trading begins.

    The S&P 500 (^GSPC) started almost flat, and the Dow Jones Industrial Average (^DJI) was slightly lower. Investors have been keeping an eye on the blue-chip Dow Jones as it approaches the $40,000 level in recent trading. The Nasdaq Composite Index (^IXIC), which has a high proportion of high-tech stocks, rose 0.6%.

    Wall Street started 2024 on a high note. The benchmark S&P 500 has set 22 new closing records so far this year as part of its best first quarter since 2019.

    A softening in the Fed's preferred inflation indicator on Friday was interpreted by investors as another sign that interest rates could be cut as early as June.

  • Start with Apple's pre-earnings warnings.

    Apple (AAPL) stock is down 11% year-to-date, making the Magnificent Seven's performance the second-worst after Tesla (TSLA)'s 30% decline, leading to Wall Street may be ready to sound the alarm on some upcoming earnings reports from tech companies. .

    Loop Capital analyst Ananda Barua was the first person to report negative earnings for Apple within weeks.

    Baruah now predicts that Apple's overall revenue and profits for calendar 2024 will decline year over year for the first time since 2016.

    Reason behind the phone:

    • iPhone shipments are “simply too low” due to “organic demand” and weak competitiveness.

    • Competition between Huawei and Xiaomi is “having a significant impact.”

    • The average selling price of iPhones is “trending flat,” Baruah said.

  • The arrival of financial settlement season

    Believe it or not, a new earnings season for major banks begins on April 12th.

    One thing to consider is the disconnect between what Wall Street expects and what companies expect given record market conditions.

    Here are some of the latest statistics from FactSet on this point.

    Wall Street: Analysts revised their first-quarter profit forecasts slightly below average. On a per-share basis, first-quarter earnings are down 2.5% since Dec. 31. This decline is smaller than the five-year average decline of 3.7% and the 10-year average decline of 3.4%. Mood: Analysts are feeling more optimistic than usual ahead of first-quarter earnings season. This is likely due to strong market advances.

    Company: About 112 S&P 500 companies have issued first-quarter earnings estimates, with 79 issuing warnings and the rest beating expectations. FactSet noted that the number of companies issuing negative EPS guidance is higher than the average for the past five and 10 years.Atmosphere: Companies don't share Wall Street's enthusiasm

  • Should you pay attention to semiconductor stocks in April?

    Here's a great chart of the semi-finals from BTIG technical analyst Jonathan Krinsky. This shows how quickly the Philadelphia Semiconductor Index (SOX) has risen in a relatively short period of time (compared to the past five-month period).

    Can the gains continue? Quasi-bulls may have to contend with the seasonal atmosphere in April.

    Krinsky noted that the SOX index has been negative in eight of the past 10 Aprils.

    SOX has skyrocketed in recent months.SOX has skyrocketed in recent months.

    SOX has skyrocketed in recent months. (BTIG)

  • Why Alphabet's stock price is depressed

    You probably didn't realize it, given the meteoric rise of AI stocks and the hype surrounding their technology, but Alphabet (GOOGL) stock isn't really involved. Alphabet shares have increased 8% since the beginning of the year, lagging the Nasdaq Composite's 9% rise and the S&P 500's 10.16% rise.

    Jefferies analyst Brent Till offered several reasons this morning as to why the stock is sucking wind.

    What I find most interesting is the call for management concerns. CEO Sundar Pichai has had a difficult 12 months on the AI ​​front, falling behind Microsoft (MSFT) in AI and failing to quell concerns about AI bias. . Is he being watched closely by investors? We're not quite there yet, but it's worth keeping an eye on.

    Jeffries said:

    1. Generative AI is a long-term threat to Alphabet's core search giant.

    2. Till said some investors are asking whether Pichai has led with “sufficient force” in responding to the AI ​​threat. He added that eight months had passed without an update on Ruth Porat's position within the company. She was replacing her role as CFO.

    3. Google Cloud's backlog is not growing as quickly as Amazon (AMZN), suggesting a loss in market share.

  • Inside the market starting in April

    April 8th is the day of a total solar eclipse. You may also need sunglasses as you see how the market and certain stocks will start in April.

    A little data analysis by you (thanks to Jared Blikre of Yahoo Finance for the statistics):

    • The S&P 500 has gained 10.16%, making it the best performer of the major U.S. indexes year-to-date. (It's the only major index to rise by double digits.)

    • Four well-known sector ETFs are up double digits since the beginning of the year: Energy (XLE), Financials (XLF), Industrials (XLI), and Communications Services (XLC). Energy was the best performer, following a new rise in oil prices.

    • The leading real estate ETF, Real Estate Select Sector SPDR Fund (XLRE), is down 1.3% year-to-date and is the worst performer, despite expectations that interest rates will fall at some point this year. It has become one of the things.

    • Two of the Magnificent Seven stocks, Tesla (TSLA) and Apple (AAPL), have seen double-digit declines since the beginning of the year.

    • The best performer on the Dow since the beginning of the year has been Disney (DIS), up 35% and at an all-time high ahead of this week's showdown between Disney CEO Bob Iger and activist Nelson Peltz. ing. Read more from Yahoo Finance's Alexandra Canal here.

    • Year-to-date, the Dow's worst performer has been Boeing (BA), -25%. No surprises here.

    • Best performing Nasdaq 100 stocks not named Nvidia (NVDA): Constellation Energy (CEG), +58%. interesting.

    • The worst-performing Nasdaq 100 stock without Tesla's name is Sirius (SIRI) -29 despite a major rebrand last fall aimed at improving its story among investors. % was.



Source link

Share.

Related Posts

Add A Comment
Leave A Reply