Updated Fri, Nov 15 20249:30 AM EST
Stocks lower, heading for a negative week as postelection rally loses steam: Live updates
Traders work on the floor of the New York Stock Exchange at the opening bell on November 13, 2024, in New York City.
Angela Weiss | AFP | Getty Images
U.S. stock futures fell on Friday morning as the postelection rally wavered and the Federal Reserve signaled it was in no hurry to keep cutting interest rates.
Futures tied to the Dow Jones Industrial Average lost 210 points, or 0.48%. S&P 500 futures slipped about 0.59%, while Nasdaq 100 futures shed 0.98%.
Shares of Applied Materials, which makes equipment for the chip industry, fell more than 8% in early trading after the company gave weak guidance for revenue in the current quarter. Domino’s Pizza jumped more than 7% after Berkshire Hathaway announced a new stake in the pizza chain.
That action follows a losing day on Wall Street as the postelection upswing continued to show signs of fizzling. The Dow fell more than 200 points on Thursday, while the S&P 500 and Nasdaq Composite each slipped about 0.6%.
Stocks took a leg down Thursday afternoon after Federal Reserve Chairman Jerome Powell said during an event in Dallas that the central bank wasn’t “in a hurry” to cut interest rates. That comes after the Fed cut the borrowing cost last week. Markets have trimmed expectations for another cut at the Fed’s December policy meeting and are now assigning a roughly 62% probability of a quarter percentage point reduction, per the CME Group’s FedWatch Tool, down from 82.5% before Powell’s remarks on Thursday. That’s compared to a 37% probability for holding rates steady next month.
The three major indexes are tracking to end the week lower, giving up some gains seen during last week’s climb on the back of Donald Trump’s victory in the presidential election. The Nasdaq Composite has dropped 0.9% this week, while the S&P 500 and Dow have shed 0.8% and 0.5%, respectively. The Dow closed above 44,000 for the first time ever on Monday.
“Investors are catching their breath and evaluating whether the advance has merit,” said Sam Stovall, chief investment strategist at CFRA Research. “We really don’t see anything on the horizon right now to upend stocks, but investors are always sort of looking around to see what could cause the trend to end.”
Shares of Tesla, thought to be a major election beneficiary because of CEO Elon Musk’s backing of President-elect Donald Trump, are off by 3% this week after rocketing higher 29% last week.
Retail sales data on Friday showed an increase of 0.4% in October, slightly better than the 0.3% forecast from economists polled by Dow Jones. That caps a busy week for economic data that was punctuated by releases of closely watched inflation gauges focused on consumers and producers.
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 quarter ending on 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
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, California, US, on Wednesday, Nov. 13, 2024. The US Census Bureau is scheduled to release retail sales figures on November 15.
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 a number of 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
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
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 62%, according to the CME Group’s FedWatch gauge, which had indicated a probability as high as 82% just a few days ago.
In remarks Thursday, Federal Reserve Chair Jerome Powell said policymakers don’t need to rush to ease monetary policy. Boston Fed President Susan Collins told the Wall Street Journal that a cut isn’t “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
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, August 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’s still watching the data “and we’ll have to continue to weigh what makes sense.”
Markets are assigning about a 62% probability of a quarter percentage point reduction, according to the CME Group. That’s 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
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 that 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
375.92
-6.85 (-1.79%)
Last | 9:32 AM EST
ULTA, 1-day
— Sean Conlon
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 (NYSE), January 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 merger 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
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-election 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
7 Hours Ago
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
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% side this week. The S&P 500 and Dow have shed 0.8% and 0.5%, respectively.
— Alex Harring
BlackRock’s Rick Rieder believes the Fed should cut rates one more time in December
Rick Rieder, BlackRock Senior Managing Director, Chief Investment Officer of Global Fixed Income, speaking at the Delivering Alpha conference in NYC on Sept. 28th, 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% to 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 afternoon. “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
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
15 Hours Ago
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