Updated Fri, Nov 15 20245:12 PM EST
Dow closes 300 points lower Friday as rate worries hinder postelection rally: Live updates
Traders work on the New York Stock Exchange floor on Nov. 12, 2024.
Spencer Platt | Getty Images
Stocks tumbled on Friday as the postelection rally fizzled and investors fretted over the path of interest rates.
The Dow Jones Industrial Average lost 305.87 points, or 0.70%, to end at 43,444.99. The S&P 500 slipped 1.32% and closed at 5,870.62, while the Nasdaq Composite fell 2.24% to 18,680.12.
Declines in pharmaceutical stocks weighed on the 30-stock Dow and the S&P 500, with Amgen down about 4.2% and Moderna off by 7.3%. President-elect Donald Trump said on Thursday that he planned to nominate vaccine skeptic Robert F. Kennedy Jr. to lead the U.S. Department of Health and Human Services. The SPDR S&P Biotech ETF (XBI) tumbled more than 5% and posted its worst week since 2020.
The information technology sector of the S&P 500 was the worst-performing corner of the market, down more than 2%, as Nvidia, Meta Platforms, Alphabet and Microsoft tumbled. Tesla was a rare exception among its “Magnificent Seven” peers, as shares of the electric vehicle giant and so-called “Trump Trade” were higher by 3%.
“While we think the macro backdrop still bodes well for risk assets, in the near term we should expect some micro volatility, particularly around potential policy shifts under a new administration,” said Kristy Akullian, head of iShares investment strategy, Americas, at BlackRock. “We expect the U.S. equity market to continue to move higher, but don’t expect that rise to happen in a straight line.”
Traders also grappled with recent comments from Federal Reserve Chair Jerome Powell, who said on Thursday that the central bank wasn’t “in a hurry” to cut interest rates. He noted that the economy’s strong growth will permit policymakers to take their time as they decide the extent to which they reduce rates. Boston Fed President Susan Collins took the cautious sentiment further, telling The Wall Street Journal that a rate cut next month is not a certainty.
October retail sales data on Friday showed a 0.4% increase, slightly better than the 0.3% forecast from economists polled by Dow Jones. That finding follows an October consumer inflation report that was in line with economists’ projections.
The major averages had been coasting on a postelection rally since Trump’s victory at the polls — the three indexes touched fresh highs on Monday — but the upward momentum has been slowing. The S&P 500 posted a weekly loss of 2.1%, while the Nasdaq Composite slid about 3.2%. The 30-stock Dow fell 1.2% during the period.
11 Hours Ago
Stocks close lower, notch losing week
Stocks closed lower on Friday and were in the red for the week as a postelection rally ran out of steam.
The S&P 500 lost 1.32% to close at 5,870.62, while the Nasdaq Composite shed 2.24% to 18,680.12. The Dow Jones Industrial Average pulled back more than 305 points, or 0.7%, to finish the session at 43,444.99.
— Brian Evans
11 Hours Ago
Third quarter shows maybe corporate profits are less than they’re cracked up to be
Maybe there are chinks in the armor of third-quarter corporate profits. Yes, the S&P 500 blended earnings growth rate, including reported numbers and estimates, for the Q3 of 2024 is 5.4%, marking the fifth straight quarter of earnings growth, wrote John Butters, senior earnings analyst at FactSet.
But the 75% of companies that have beaten analysts’ earnings estimates in the quarter is below the five-year average of 77%. Moreover, S&P 500 companies are topping forecasts by an average 4.3%, almost half the five-year average of 8.5%.
Meanwhile, the look ahead may be less bright. Of the 80 companies in the S&P 500 that have estimated their fourth-quarter earnings, 54, or 68%, issued negative guidance, while 26, or 32%, made positive forecasts. The 68% that issued downbeat assessments topped the five-year average of 58% and the 10-year average of 62%, FactSet said.
Perhaps most ominously, the forward price-to-earnings ratio for the S&P 500 looking out over the next year stands at 22.0, above the five-year forward P/E average of 19.6 as well as the 10-year average of 18.1, the researcher said.
— Scott Schnipper
12 Hours Ago
Goldman Sachs resumes coverage of airlines with buy ratings on three stocks
An Alaska Airlines Boeing 737 MAX 9 departs Los Angeles International Airport en route to Puerto Vallarta on Sept. 19, 2024.
Kevin Carter | Getty Images
In a Friday note, Goldman Sachs resumed coverage of the airline industry with buy ratings on shares of Alaska Air Group, Delta Air Lines and United Airlines, which have respectively gained 35%, 61% and 121% in 2024.
Analyst Catherine O’Brien noted that airline stock price performance has been volatile this year as the industry continues to grapple with post-pandemic effects. The airlines added too much capacity in off-peak periods, resulting in weaker pricing, although growth still remains constrained overall due to aircraft delivery delays and lack of supplies.
“We expect supply constraints to continue (and in some cases worsen) into 2025 and that a return to pre-pandemic seasonality has been firmly established, with the latter encouraging more capacity discipline in off-peak periods,” the analyst wrote. “We expect stock performance to continue to be mixed, with airlines exposed to premium/corporate demand and improving competitive capacity in addition to idiosyncratic margin tailwinds to outperform. These drivers underpin our Buy ratings on ALK, DAL, and UAL.”
O’Brien forecast that industry unit revenue will increase 2% year over year going forward. The analyst added that the airlines currently appear to be underearning versus Goldman Sach’s normalized margin forecast.
In the same note, O’Brien resumed coverage with sell ratings on shares of JetBlue Airways and Southwest Airlines. The stocks are respectively trading 28% and 12% higher this year.
— Lisa Kailai Han
12 Hours Ago
Small-cap stocks pull back this week
Small-cap stocks have seen outsized losses this week, reversing course after the postelection rally.
The Russell 2000 has dropped around 4% this week, hurt in part by a slide of more than 1% on Friday. The S&P 500 has lost just 2.2% over the course of the week.
Russell 2000 Index
.RUT:Exchange
2,303.84
-33.10 (-1.42%)
Last | 11/15/24 EST
The Russell 2000, 5 days
That marks a turn after the Russell 2000 jumped more than 8% last week. Small caps are seen as beneficiaries of President-elect Donald Trump’s victory, as his preference of deregulation can aid tinier firms.
Despite this week’s declines, the Russell 2000 is up nearly 5% in November. It is poised to finish 2024 more than 13% higher.
— Alex Harring
13 Hours Ago
Bloom Energy on track for best day ever
Shares of Bloom Energy soared more than 51% during the session, hitting a new 52-week high and putting the stock on pace for its biggest percentage increase on record.
The move comes on the heels of Piper Sandler upgrading its rating on the renewable energy name to overweight from neutral, seeing that its recent supply agreement with American Electric Power could lead to other growth opportunities for the company. The investment bank’s updated price target implies 50.6% upside from Thursday’s close.
The stock has already seen massive gains in recent weeks, surging more than 109% month to date. This year, it has risen about 36%.
Bloom Energy Corp
BE:NYSE
After Hours: Last | 11/15/24 EST
21.11-0.03 (-0.14%)
21.14
+7.86 (+59.19%)
BE, 1-day
— Sean Conlon
14 Hours Ago
Moderna, Super Micro, Alibaba among stocks making biggest midday moves
Check out the companies making headlines in midday trading:
- Global pharma stocks — Shares of several vaccine makers declined after President-elect Donald Trump selected prominent vaccine skeptic Robert F. Kennedy Jr. as health secretary on Thursday. Shares of Moderna and Pfizer slipped nearly 9% and 5%, respectively. BioNTech, which helped develop a Covid vaccine with Pfizer, shed 5%, while GSK declined about 2%. Even names such as Eli Lilly and Novo Nordisk were lower, with both stocks slipping about 4%, amid concerns that the drug approval process could be slowed.
- Super Micro Computer — Shares of the embattled server company fell 2% ahead of a Monday deadline that could result in the company being delisted from the Nasdaq. Super Micro is late on filing a year-end report with the U.S. Securities and Exchange Commission, putting it on the wrong side of the Nasdaq’s rules. This would be the 11th losing day in the last 13 trading sessions for Super Micro.
- Alibaba — Shares slipped more than 2% after the Chinese e-commerce giant’s fiscal second-quarter sales fell short of estimates amid a weakening consumer backdrop in China. Alibaba’s revenue of 236.5 billion yuan came out 5% higher year on year but below analysts’ expectations of 238.9 billion yuan, per LSEG.
For the full list, read here.
— Pia Singh
15 Hours Ago
Nvidia falls, heads for losing week as member of the Dow
The logo of Nvidia Corporation is seen during the annual Computex computer exhibition in Taipei, Taiwan.
Tyrone Siu | Reuters
Nvidia fell more than 2% on Friday, continuing a rough start to the chip giant’s tenure as a member of the Dow Jones Industrial Average.
The stock was officially added to the 30-stock blue chip average before trading began last Friday. Nvidia is now on track for its fourth losing session in six since the addition.
NVIDIA Corp
NVDA:NASDAQ
After Hours: Last | 11/15/24 EST
142.70+0.72 (+0.51%)
141.98-4.78 (-3.26%)
Nvidia stock is on track to be a loser on the week, its first a member of the Dow.
Nvidia was trading just under $143 per share in midday trading, meaning it is down about 4% from when it entered the Dow, and is down about 3% for the week.
— Jesse Pound
15 Hours Ago
Health care leads weekly losses
The health-care sector lost 5.3% on the week, making it the worst-performing group in the S&P 500.
Materials and information technology were the following biggest decliners, falling 3.1% and 2.9%, respectively.
The only sectors on pace to end the week in the green were financials and energy, which were up 1.3% and 0.9%, respectively.
— Hakyung Kim
16 Hours Ago
Chicago Fed’s Goolsbee still sees rates on a downward path
Austan Goolsbee speaking at Jackson Hole on Aug. 23, 2024.
David A. Grogan | CNBC
Chicago Federal Reserve President Austan Goolsbee expressed confidence Friday that the central bank is on the way to achieving its economic goals and can continue to lower interest rates.
“To me, the conditions on the dual mandate side are looking pretty balanced,” Goolsbee said during a CNBC “Squawk Box” interview. “So we should be thinking over the next year, year and a half, the rates need to come down.”
However, Goolsbee also endorsed phrasing Thursday by Fed Chair Jerome Powell that the Fed does not need to be in “a hurry” to cut.
“Unless the conditions change, I’m still feeling good about us being on a 12- to 18-month path of getting the rates down to something like neutral,” he said.
— Jeff Cox
17 Hours Ago
Stocks open lower, on pace for losing week
Stocks opened lower on Friday and were on pace to end the week in the red, as the postelection rally failed to recover.
The S&P 500 fell 0.63%, while the Nasdaq Composite slipped 0.98%. The Dow Jones Industrial Average pulled back 113 points, or 0.25%.
— Brian Evans
18 Hours Ago
Alibaba shares rise after company posts 58% year-over-year profit jump
Alibaba shares climbed before the opening bell after the Chinese e-commerce giant beat profit expectations for the quarter that ended Sept. 30. Its sales disappointed, however, reflecting a broader slowdown in the Chinese retail environment and consumer spending.
Alibaba’s net income rose 58% year on year over the quarter, on the back of the performance of its equity investments. Its revenue of 236.5 billion yuan was 5% higher year on year but below analysts’ expectations of 238.9 billion yuan, according to LSEG data.
Philippe Laffont’s Coatue Management and Michael Burry’s Scion Asset Management boosted their stake in Alibaba significantly, according to recent regulatory filings.
Alibaba shares are up 16.9% this year.
— Pia Singh
18 Hours Ago
Retail sales rose in October; import prices up, New York manufacturing surges
Shoppers carry Ross and Levi’s bags on Post Street in San Francisco on Nov. 13, 2024.
David Paul Morris | Bloomberg | Getty Images
Consumer spending held up in October, though some of the details suggested weakness, according to a Census Bureau report Friday.
Retail sales overall rose 0.4%, down from the upwardly revised 0.8% increase in September but slightly better than the Dow Jones estimate for an increase of 0.3%. However, sales were up just 0.1% excluding autos, compared to a 0.3% forecast, while the “control” group, which excludes several items and feeds directly into GDP calculations, decreased 0.1%.
In other economic news Friday, import prices rose a stronger than expected 0.3% in October. Also, the Empire State Manufacturing Index soared to 31.2, its highest level since December 2021 and far better than the estimate for a flat reading.
— Jeff Cox
19 Hours Ago
Stocks making the biggest moves premarket
Check out the companies making headlines before the bell:
- Applied Materials — Shares tumbled more than 8% after the semiconductor equipment manufacturer offered weak revenue guidance for the current quarter. Applied Materials said it forecasts $7.15 billion in the first fiscal quarter, under the estimate of $7.224 billion from analysts polled by LSEG. The company also reported better-than-expected fiscal fourth-quarter results and provided a strong outlook for adjusted earnings per share.
- Alibaba — Shares jumped more than 3% after the Chinese e-commerce giant beat profit expectations in its fiscal second quarter, although its sales disappointed as the company continues to grapple with weaker consumer spending in China. Alibaba’s net income rose 58% year on year, on the back of its equity investment performance. Its revenue of 236.5 billion yuan came out 5% higher year on year but below analysts’ expectations of 238.9 billion yuan, according to LSEG data.
- Moderna — The biotech company’s shares fell 1.8%, continuing its decline from Thursday following the news that Robert F. Kennedy Jr., a prominent vaccine skeptic, was announced as President-elect Donald Trump’s nominee for secretary of the Department of Health and Human Services.
The full list can be found here.
— Hakyung Kim
19 Hours Ago
Market sees less of a chance of an interest rate cut in December
Market expectations for an interest rate cut in December have eased over the past few days following cautious remarks from Federal Reserve officials.
The odds of a move next month have fallen to 58.7%, according to the CME Group’s FedWatch gauge, which had indicated a probability as high as 82% just a few days ago and was close to 63% earlier Friday morning.
In remarks Thursday, Federal Reserve Chair Jerome Powell said policymakers do not need to rush to ease monetary policy. Boston Fed President Susan Collins told The Wall Street Journal that a cut is not “a done deal,” while Dallas Fed President Lorie Logan also called for caution and Richmond Fed President Thomas Barkin expressed some concern that inflation could prove sticky.
In all, traders now expect the Fed will approve the equivalent of three quarter-percentage-point cuts through the end of 2025, a trend that also has eased in recent days.
— Jeff Cox
20 Hours Ago
Boston Fed president says December rate cut ‘not a done deal’
Federal Reserve Bank of Boston President Susan Collins stands behind the Jackson Lake Lodge in Jackson Hole, where the Kansas City Fed holds its annual economic symposium, in Wyoming on Aug. 24, 2023.
Ann Saphir | Reuters
A December interest rate cut is “certainly on the table, but it’s not a done deal,” Boston Federal Reserve President Susan Collins said in an interview.
Despite market expectations that the central bank will approve its third straight reduction, Collins told The Wall Street Journal that she is still watching the data “and we’ll have to continue to weigh what makes sense.” The Journal said the interview occurred late Thursday.
Markets are assigning about a 62% probability of a quarter-percentage-point reduction, according to the CME Group. That has decreased in recent days as multiple Fed officials have expressed caution about moving too quickly.
Collins will be a voter on the rate-setting Federal Open Market Committee in 2025.
— Jeff Cox
20 Hours Ago
Ulta shares fall in the wake of Berkshire selling shares
Shares of Ulta fell nearly 5% in the premarket on Friday after Warren Buffett’s Berkshire Hathaway revealed it nearly dissolved its stake in the name.
On Thursday, Buffet’s holding company disclosed in a regulatory filing that it sold about 97% of shares last quarter. This comes after the holding company bought the stock in the second quarter.
The stock has had a rough year, with shares plummeting nearly 22%.
Ulta Beauty Inc
ULTA:NASDAQ
After Hours: Last | 11/15/24 EST
365.17UNCH (UNCH)
365.17-17.60 (-4.60%)
ULTA, 1-day
— Sean Conlon
20 Hours Ago
Wells Fargo upgrades shares of Morgan Stanley ahead of anticipated inflection point in capital markets
A screen displays the trading information for Morgan Stanley on the floor of the New York Stock Exchange on Jan. 19, 2022.
Brendan McDermid | Reuters
President-elect Donald Trump’s White House victory and a GOP-controlled Congress could lead to more gains for Morgan Stanley, according to Wells Fargo.
The bank upgraded the name to equal weight from underweight, and its updated price target reflects more than 7% upside from Thursday’s close. Meanwhile, the stock has already seen year-to-date gains of around 42%.
“We [estimate] more excess capital than before, [especially] given likely better internal capital generations [with estimated] EPS growth inflecting from negative to positive,” analyst Mike Mayo told clients in a Thursday note. The analyst added that more mergers and IPO activity should spur the inflection in capital markets.
“Indeed, we see a scenario when activity is front-loaded given a 2-year window given the potential for the Senate to flip back,” he continued. “We upgrade MS from U/W to Equal Weight given possible greater than expected short-term tailwinds.”
Anticipating that banks will have more flexibility to return and deploy capital, and that bank mergers will see a “resurgence,” Mayo also upgraded Comerica to equal weight from underweight. That stock has risen more than 25% this year.
— Sean Conlon
24 Hours Ago
European stocks sink at the open
European markets opened lower Friday, as investors assessed fresh economic data and the future path for interest rate cuts following hawkish comments from U.S. Federal Reserve Chair Jerome Powell.
The pan-European Stoxx 600 fell 0.8% in early deals, with all major bourses and almost all sectors sinking into the red.
Health-care stocks shed 1.72%, tracking wider falls for global vaccine makers, as investors weighed President-elect Donald Trump’s nomination of Robert F. Kennedy Jr. to lead the Department of Health and Human Services.
Tech stocks also fell 1.36%, while utilities were a sole outlier, up 0.06%.
— Karen Gilchrist
Fri, Nov 15 20242:25 AM EST
Asia markets mixed as investors assess Japan and China economic data
Markets in Asia were mixed on Friday, as investors in the region assessed key economic data out of China and Japan.
China released October numbers for retail sales, industrial production and urban unemployment, among others, while Japan’s third-quarter gross domestic product was also announced.
Japan’s Nikkei 225 was up 0.28% after the GDP announcement, while the broad-based Topix rose 0.39%.
Hong Kong’s Hang Seng index rose 0.18% as of its final hour, while mainland China’s CSI 300 fell 1.75% after the data release to 3,968.83.
The yen strengthened marginally against the U.S. dollar to 156.19, after initially weakening after the GDP release.
— Lim Hui Jie
Fri, Nov 15 20246:48 PM EST
Major averages on track for weekly losses
With just Friday left in the trading week, the three major indexes are on track to end in the red.
The Nasdaq Composite has led the way down with a 0.9% slide this week. The S&P 500 and Dow have shed 0.8% and 0.5%, respectively.
— Alex Harring
Fri, Nov 15 20246:29 PM EST
BlackRock’s Rick Rieder believes Fed should cut rates one more time in December
Rick Rieder, BlackRock’s senior managing director, speaking at the Delivering Alpha conference in New York City on Sept. 28, 2023.
Adam Jeffery | CNBC
The Federal Reserve should cut rates at least one more time in December before stopping to evaluate its path, according to BlackRock bond king Rick Rieder.
The federal funds rate is currently sitting at a target range of between 4.5% and 4.75%, which Rieder said is restrictive for most potential borrowers and homebuyers. Rieder believes the U.S. central bank should reduce this by another quarter-percentage point in December to get it closer to 4%.
“Once you get that rate there, then you can sit back and say okay, what do we need to do from this point going forward?” Rieder said on CNBC’s “Closing Bell” on Thursday. “I still think they would like to get at least a couple of cuts done into next year, but the pace at which that happens and whether they actually need it gets really called into question.”
— Lisa Kailai Han
Fri, Nov 15 20246:11 PM EST
See the stocks moving in extended trading
These are some of the stocks moving after the bell:
- Domino’s Pizza — Shares surged more than 7% after Berkshire Hathaway announced a new stake in the pizza chain.
- Applied Materials — The semiconductor equipment manufacturer slid more than 5% after posting a weaker-than-anticipated revenue outlook for the current quarter.
- Palantir Technologies — The defense tech company added nearly 4% after announcing it will transfer its stock exchange listing from the New York Stock Exchange to the Nasdaq.
— Alex Harring
Fri, Nov 15 20246:05 PM EST
Dow, S&P 500 futures are near flat
Dow and S&P 500 futures were little changed shortly after 6 p.m. ET.
Both slipped around 0.1%. Meanwhile, Nasdaq 100 futures ticked lower by 0.2%.
— Alex Harring