Nasdaq futures rise after benchmark’s worst day since April: Live updates

A Solarpro employee installs a SolarEdge Technologies inverter at a residential property in Sydney, Australia, on May 17, 2021.

Brendon Thorne | Bloomberg | Getty Images

SolarEdge fell more than 20% on Tuesday after disclosing that a customer that owes the company $11.4 million has filed for bankruptcy.

SolarEdge said it cannot guarantee the outcome of the bankruptcy proceedings and may not be able to collect that amount owed by PM&M Electric.

SolarEdge also announced plans to offer $300 million in convertible senior notes.

SolarEdge manufactures inverters for home solar installations. The inverters convert solar power into electricity that is useable for homes.

SolarEdge is down 71% this year, as the company has struggled to de-stock inventory after demand slowed due to higher rates.

— Spencer Kimball

The S&P 500 and Nasdaq Composite finished Tuesday’s session in the green.

The broad market S&P rose 0.39%, and the tech-heavy Nasdaq Composite gained 1.26%.

The Dow Jones Industrial Average, meanwhile, fell 299.05 points, or 0.76%.

— Hakyung Kim

Oil pump under the blue sky with beam pumping unit in the oil field.

Zheng Zaishuru | iStock | Getty Images

Crude oil futures fell about 1% Tuesday as the recent rally took a breather, with traders watching for summer fuel demand and tensions on the Israel-Lebanon border.

U.S. crude oil and global benchmark Brent are ahead by 4.9% and 4.1%, respectively, for the month as prices have bounced back from May doldrums on a more optimistic outlook for summer fuel demand.

But the oil market slipped Tuesday as prices failed to maintain upside momentum, with funds liquidating recently acquired long positions, according to Ryan McKay, senior commodity strategist at TD Securities.

U.S. crude oil closed at $80.83 per barrel.

Though the rally has taken a breather, geopolitical tensions should prevent another rout in oil prices, as tensions between Israel and Lebanon raise the risk of a disruption to crude supplies, according to McKay.

— Spencer Kimball

With the realized stock correlation at 20-year lows according to Bank of America, the firm posits that the trend extends beyond the dissociation of technology stocks and the artificial intelligence boom.

“The correlation decline, which began in late 2022, is not just driven by tech/AI dissociating from the rest of the market (as inter-sector correlation nears 30y+ lows) but is also due to eroding intra-sector stock correlation,” BofA analyst Nitin Saksena wrote Tuesday.

“Multiple years of decorrelation in the 90s as the internet bubble developed suggests that persistence of today’s regime remains a risk, especially if we see similar patterns in AI stocks, or if today’s narrowness resolves itself in a rotation from tech to the rest of the market,” Saksena added.

— Brian Evans

The S&P 500 is “at a critical juncture,” and if the artificial intelligence boom evolves into an even bigger bubble, the benchmark index could soar all the way to 6,666, Societe Generale strategists Manish Kabra and Charles de Boissezon wrote Monday.

“The outperformance of mega caps vs the average S&P 500 stock” puts the market at a crossroads, they said. “Narrow breadth typically occurs in a bear market or when a few concentrated stocks have the potential to take us into a ‘bubble’ — neither of which is our base case. We see cyclical opportunities outside Tech too, e.g. in Industrials and Financials, increasing performance breadth within large caps.”

Societe Generale’s upside scenario assumes a 24.7x valuation — equal to the March 2020 high at the peak of the TMT mania — on $270 in S&P 500 earnings, and crude oil headed toward $60 a barrel “on the back of significant OPEC spare capacity.”

The downside in Societe Generale’s outlook depends on U.S. weekly jobless claims “substantially” exceeding 300,000, “if small firms’ declining profit margins fall materially.”

— Scott Schnipper

About 4 out of every 5 S&P 500 stocks traded lower despite the broad index advancing, underscoring Nvidia‘s effect on the broader market.

Nearly 400 stocks in the benchmark index traded lower in afternoon trading. While just more than 100 were on track for gains, those advances were enough to lift the S&P 500 about 0.3%.

Artificial intelligence darling Nvidia added more than 5%, surpassed only by Carnival‘s 7.5% jump on the back of earnings. On the other hand, Pool Corp. was the biggest loser in the S&P 500, sliding more than 7% after offering updated guidance.

— Alex Harring

Nvidia‘s recent slump has not scared away investors willing to take leveraged bets on a continued rally.

The GraniteShares 2x Long NVDA Daily ETF (NVDL) has added assets for the past three trading days for a total net inflow of $1 billion, according to FactSet.

Daily flow data is not perfectly comparable to daily trading moves, but some of those inflow orders almost certainly happened with the fund in the middle of a sharp slide.

The fund dropped about 25% over the past three sessions, but its shares were up 11% in afternoon trading Tuesday.

This leveraged Nvidia ETF was rebounding on Tuesday.

Jakub Porzycki | Nurphoto | Getty Images

Evercore ISI hiked its price target on Apple to $250 on Tuesday from $220 previously, as the Wall Street firm remains bullish on an increase in iPhone revenue.

“Apple stock has seen a nice increase since WWDC, but we still think there is more room to run as we see potential for material upside to current iPhone revenue expectations,” Evercore ISI said in a note. “Apple’s decision to limit Apple Intelligence features to the iPhone 15 Pro or the upcoming iPhone 16 lineup should result in strong demand for the new phones.”

The firm’s new outlook would translate into a 19% upside for Apple’s stock, which currently trades around $210.

— Yun Li

UBS believes investors are not fully pricing in the number of rate cuts in the upcoming future.

“Overall, we think markets are underestimating the likely number of Fed cuts over the cycle,” the bank wrote in a Tuesday note. “Fed officials put their estimate of the longer-run fed funds rate at 2.75% in their latest “dot plot” projection, compared with around 4% as current market pricing suggests.”

To that end, UBS recommended investors with a lot of cash on their hands consider investments for their liquidity, including bonds and a diversified fixed income allocation.

— Lisa Kailai Han

An aerial view of BYD vehicles waiting to be shipped aboard at Yantai Port in Yantai, Shandong Province of China, on April 18, 2024.

Vcg | Visual China Group | Getty Images

Berkshire Hathaway’s selling in China’s biggest electric vehicle maker BYD resumed with the conglomerate now owning less than 6%.

Warren Buffett’s giant firm has trimmed its lucrative BYD stake to 5.99% as of June 19 from 7% just two days prior, according to a filing to the Hong Kong Stock Exchange. 

Berkshire is an early investor in BYD thanks to the late Charlie Munger. It first bought about 225 million shares of Shenzhen-based BYD in 2008 for around $230 million.

Hong Kong’s rules only require a filing when a stake percentage crosses a whole number, so if Berkshire’s stake falls below 5%, there will be another filing.

— Yun Li

Hedge funds are rotating out of tech stocks, especially winning chipmakers, after strong gains in the first half, according to data from Goldman Sachs’ prime brokerage.

Technology stocks saw the most net selling from the professional trading cohort last week, which have been rotating out of the sector for four of the past five weeks, according to Goldman. Semiconductor and chip equipment shares experienced the most significant selling during the period, Goldman said.

— Yun Li

The Carnival Miracle cruise ship is anchored in the Pacific Ocean near Kailua Bay during a 15-day cruise, in Kailua-Kona, Hawaii, on Jan. 14, 2024.

Kevin Carter | Getty Images

Here are the stocks on the move midday:

• SolarEdge Technologies – Shares of the company tumbled more than 20% following the announcement that it will offer $300 million worth of convertible notes due 2029. The company also revealed in a U.S. Securities and Exchange Commission filing on Monday that a customer won’t be able to pay about $11.4 million that it owes after filing for bankruptcy.
• Pool Corp. — The stock plunged more than 7% after the company updated its earnings guidance for the full year on Monday after the bell. The wholesale pool supplies distributor expects full-year earnings between $11.04 and $11.44 per share. This is lower than its prior guidance of between $13.19 and $14.19 per share and below FactSet’s consensus estimate of $13.05. Pentair and Leslie’s fell in sympathy following the revision, declining about 6% each.
• Carnival – Shares added nearly 8% after the cruise company posted a second-quarter earnings and revenue beat. Carnival reported profit of 11 cents per share, excluding items, on revenue of $5.78 billion, while analysts surveyed by LSEG had expected a loss of 2 cents per share on revenue of $5.68 billion. Carnival also offered strong third-quarter and full-year outlooks.

Read the full list here.

— Sean Conlon

Lisa Cook testifies during a Senate Banking nominations hearing in Washington, D.C., on June 21, 2023.

Drew Angerer | Getty Images

Federal Reserve Governor Lisa Cook said Tuesday that she expects inflation rates to change little this year but then “slowing more sharply” in 2025, possibly paving the way for interest rate cuts.

In a speech that avoided specifics on when she thinks the Fed could start easing, Cook noted that consumers are pushing back on price increases and the labor market is loosening as higher rates weigh on demand. However, she did not indicate that rate reductions are forthcoming.

“With significant progress on inflation and the labor market cooling gradually, at some point it will be appropriate to reduce the level of policy restriction to maintain a healthy balance in the economy,” Cook told the Economic Club of New York. “The timing of any such adjustment will depend on how economic data evolve and what they imply for the economic outlook and balance of risks.”

— Jeff Cox

Both stocks and bonds could be due for a drawdown, according to Barclays.

Ajay Rajadhyaksha told clients that his latest call to become more cautious on stocks last week did not work out. Notably, the S&P 500 advanced last week and at one point notched a new intraday record.

Still, he said the confluence of risks tied to politics, trade and currency markets has only increased. That is keeping him concerned about short-term performance.

“Near-term, we expect both bonds and stocks to struggle until these risks dissipate,” he told clients.

— Alex Harring

No S&P 500 stock is faring worse than Pool Corp. today, down 8%, after the pool supply distributor issued an earnings warning Monday afternoon. A main cause: Pool construction demand remains weak amid a challenging economy. The warning is significantly weighing on shares of other pool-related companies such as Pentair and Leslie’s, which are down 6% and 3%, respectively.

However, don’t overlook the ripple effect that news seems to be having on other housing-related stocks. Tractor Supply, Home Depot, Lowe’s, Mohawk, Masco and Builders FirstSource are all among the biggest decliners on the S&P 500 today, each with declines of 3% or more.

— Robert Hum

An exterior view of a Home Depot store.

Paul Weaver | Lightrocket | Getty Images

The Dow fell 170 points, or 0.4%, Tuesday morning as other major indices climbed higher. Downturns of more than 2% across Home Depot, Walmart and Boeing led the 30-stock Dow lower for the day.

Home Depot contributed to nearly a 13 point loss. Walmart and Boeing also declined around 2 and 4 points, respectively.

Only 11 stocks in the Dow were positive Tuesday.

— Hakyung Kim

Nvidia shares fell more than 6% on Monday, marking their worst day since April. The pullback also came on the back of a more than 4% weekly decline the previous week, helping to reverse some overbought signals, according to Wolfe Research managing director and technical analyst Rob Ginsberg.

“The recent shakeout has helped to quickly burn off the aggressive overbought condition that had developed and it looks like we have a bit more to go,” Ginsberg wrote in a Monday note.

Ginsberg added that historical trends indicate the market is around halfway through the consolidation.

— Hakyung Kim

Shoppers carry shopping bags while walking through The Village at Corte Madera in Corte Madera, California, on May 30, 2024.

Justin Sullivan | Getty Images

Consumer confidence edged lower in June as did the near-term outlook for business conditions, The Conference Board reported Tuesday.

The board’s confidence index moved down to 100.4, slightly below the 101.3 in May but a touch better than the Dow Jones estimate for 100. The Present Situation Index rose slightly to 141.5, while the Expectations Index decreased to 73.

“Confidence pulled back in June but remained within the same narrow range that’s held throughout the past two years, as strength in current labor market views continued to outweigh concerns about the future,” said Dana M. Peterson, the board’s chief economist.

In other economic news, the Richmond Federal Reserve’s manufacturing index slumped to -10 in June, down from zero in May and worse than the estimate for -0.5.

— Jeff Cox

Stocks are due for a pullback, according to Piper Sandler.

In recent days, large-cap tech stocks have eased from their highs as other parts of the market have outperformed, signaling a possible rotation. This week, the S&P 500 and Nasdaq Composite are down 0.3% and 1%, respectively. Meanwhile, the Dow Jones Industrial Average has risen 0.7%. The Russell 2000 gained 0.5%.

But the firm’s Craig W. Johnson expects more time will be needed to see if the rotation is sustainable, or if the consolidation he anticipates will be broad-based. He anticipates the S&P 500 could end the year at 5,050, a 7% fall from where it closed Monday.

“We believe the broader market is overdue for some consolidation/pullback as we head into the summer months,” Johnson wrote Tuesday. “Our breadth indicators must improve significantly to confirm sustainable sector rotations. The upcoming weeks will reveal whether the current trends persist or evolve into a broader market pullback.”

— Sarah Min

Shares of Carnival Corp. jumped in early trading after the cruise line reported a stronger-than-expected second quarter.

Carnival generated 11 cents in adjusted earnings per share on $5.78 billion of revenue. Analysts surveyed by LSEG were looking for a loss of 2 cents per share on $5.68 billion of revenue.

The company raised its full-year guidance for net yield and adjusted net income and said demand for 2025 is looking stronger than 2024.

The stock was up more than 6% shortly after the market open.

Shares of Carnival were climbing on Tuesday.

The S&P 500 and Nasdaq Composite began Tuesday’s trading session in the green.

The broad market index rose 0.2%, while the tech-heavy Nasdaq added 0.5%.

Meanwhile, the Dow Jones Industrial Average slipped 60 points, or 0.2%.

— Hakyung Kim

JPMorgan’s Marko Kolanovic.

Crystal Mercedes | CNBC

Softer inflation readings are raising hopes for interest rate reductions while signaling caution about the pace of economic growth, according to JPMorgan.

While consecutive lower readings from the consumer price index “were supposed to put things firmly in soft landing territory, some volatility in the initial jobless claims raises our antennas on growth risk,” Marko Kolanovic, the firm’s chief market strategist, said in a note Monday.

It’s not just the general higher trend in claims that “suggest elevated market and growth risks,” Kolanovic added. He also cited a “disconnect” between market gains and new orders and inventories in manufacturing, along with narrow breadth in market leadership, a rising unemployment rate and declining housing starts.

— Jeff Cox

Here are some of the stocks making the biggest moves premarket:

• SolarEdge Technologies — The green energy stock dropped 18% after announcing a new debt offering. SolarEdge said it will offer $300 million worth of convertible notes, due 2029.
• Sea Limited — U.S. shares of the Singapore-based consumer internet stock fell more than 4% following a JPMorgan downgrade to neutral from overweight.
• Pool Corp. — Shares sank 12.4% after the wholesale pool supplies distributor lowered its full-year earnings guidance Monday afternoon.

— Jesse Pound

Michelle Bowman, member of the Board of Governors of the Federal Reserve System, arrives to attend the afternoon session on the last day of the 2023 European Central Bank Forum on Central Banking in Sintra, Portugal, on June 28, 2023.

Horacio Villalobos | Corbis News | Getty Images

Federal Reserve Governor Michelle Bowman said Tuesday that the time is not right yet to start lowering interest rates, adding that she would be open to raising rates again if inflation doesn’t pull back.

“Should the incoming data indicate that inflation is moving sustainably toward our 2 percent goal, it will eventually become appropriate to gradually lower the federal funds rate to prevent monetary policy from becoming overly restrictive,” Bowman said in prepared remarks for a speech in London. “However, we are still not yet at the point where it is appropriate to lower the policy rate.”

The full story can be found here.

— Jeff Cox, Hakyung Kim

Tue, Jun 25 20246:22 AM EDT

Omar Marques | Lightrocket | Getty Images

Regulators at the European Union said Tuesday that Microsoft is breaching antitrust rules in the region with “abusive” bundling of Teams and Office.

“The European Commission has informed Microsoft of its preliminary view that Microsoft has breached EU antitrust rules by tying its communication and collaboration product Teams to its popular productivity applications included in its suites for businesses Office 365 and Microsoft 365,” the European Commission, the EU’s executive arm, said in a statement.

Microsoft shares were down slightly in the premarket.

— Fred Imbert

Tue, Jun 25 20246:14 AM EDT

The Nvidia logo at Computex in Taipei, Taiwan, on June 5, 2024.

Ann Wang | Reuters

NVDA rises

Tue, Jun 25 20243:13 AM EDT

European stocks opened lower Tuesday, following souring U.S. market sentiment at the start of the week.

The Stoxx 600 index was down 0.32% in opening trade, with sectors and major bourses diverging. Tech stocks sank 1.53% while oil and gas rose 0.99%.

The U.K.’s FTSE index was up 0.1% at 8,290, Germany’s DAX was 1% lower at 18,146, France’s CAC 40 was down 0.55% at 7,663 and Italy’s FTSE MIB was down 0.15% at 33,788.

Stoxx 600.

Mon, Jun 24 20246:40 PM EDT

Pool Corp. shares shed 11% after the company revised its full-year earnings guidance.

The wholesale pool supplies distributor said it now expects earnings per share to range between $11.04 and $11.44 for the full year, versus prior guidance of between $13.19 and $14.19. That is also below a FactSet estimate of $13.05.

For the second quarter, the company said it expects earnings per share to come in between $4.85 and $4.95, compared to a FactSet estimate of $5.83.

The company also said sales are trending down 6.5% from the same period last year.

— Samantha Subin

Mon, Jun 24 20246:03 PM EDT

Stock futures opened little changed Monday evening. Futures tied to the Dow Jones Industrial Average added 25 points, while S&P 500 futures hovered near the flatline. Futures connected to the Nasdaq-100 edged up 0.07%.

— Samantha Subin