Equity Indexes Wrap: Big Tech and Oil Gain While Chip Stocks Retreat

March 14, 2024 04:08 PM EDT

The Dow

Big tech led the index, with Microsoft (MSFT) rising 2.4% to close at a record high. Amazon (AMZN) gained 1.2%, and Apple (AAPL) rose 1.1% amid reports it had acquired Canadian AI startup DarwinAI.

JPMorgan Chase (JPM) fell 1.7% after federal authorities slapped it with $350 million in fines for inadequate trading surveillance. 

Cisco (CSCO) dipped 0.6% despite its $28 billion acquisition of Splunk (SPLK) winning EU approval.

The S&P 500

Halliburton (HAL) followed oil prices higher, rising 3%. 

Alphabet (GOOGL) climbed 2.5% to close higher for a sixth consecutive session. 

Altria Group (MO) rose 2.2% after it said it would sell about $2.2 billion worth of AB InBev (BUD) shares and use the proceeds to buy back its own shares. AB InBev fell 5.5%. 

Lennar (LEN) slipped 7.6% after the homebuilder’s quarterly sales fell short of Wall Street estimates. Peers Pultegroup (PHM) and D.R. Horton (DHI) dropped 3.8% and 3.1%, respectively. 

Dollar General (DG) stock shed 5.1% after it forecast lower-than-expected first-quarter earnings despite its sales forecast exceeding Wall Street’s estimates.

Regional and mid-sized lenders slipped, led by Comerica (CMA), down 3.3%, and Zions Bancorp (ZION), down 3.1%. 

The Nasdaq 100

Energy companies Diamondback Energy (FANG) and Baker Hughes (BKR) also rose with oil prices, advancing 1% and 0.6%, respectively. 

Tesla (TSLA) tumbled 4.1% to a 10-month low as reports competitor Fisker (FSR) was considering filing for bankruptcy weighed on sentiment among electric vehicle investors.

Chip stocks were mostly lower, led by Advanced Micro Devices (AMD), down 4%. Nvidia (NVDA) fell 3.2% and Micron (MU) slid 2.9%.

AB InBev Stock Falls as Altria Announces Plans to Sell Shares in Bud Light Maker

March 14, 2024 03:40 PM EDT

American Depositary Receipts (ADRs) of Anheuser-Busch InBev (BUD) slumped Thursday after Altria (MO) slashed part of its 10% stake in the beer maker at a discounted price.

Altria announced that it would be selling 35 million of its 195 million ABI shares—AB InBev shares traded on the Euronext exchange—through a global secondary offering.

AB InBev explained the shares would be priced at EUR56.17 ($61.26) per ordinary share, and $61.50 per ADR. That would be about 5% below Wednesday’s closing price in the U.S. of $64.55. The beer maker added that it plans to buy 3.34 million ordinary shares for $200 million.

The move would raise about $2.2 billion for Altria. The company noted that it expects to use the cash generated to buy back its own shares.

AB InBev ADRs were down 5.5% at $61 late in the session Thursday, while Altria shares were up 1.9% at $44.19.

–Bill McColl

PPI Shakes Up Treasurys, Rate-Sensitive Assets

March 14, 2024 03:05 PM EDT

Treasury yields surged Thursday as markets digested data suggesting U.S. inflation ran hotter than expected in February. 

The Producer Price Index, a measure of wholesale inflation, rose 0.6% in February from January. That was twice the increase economists were expecting. It was the second hotter inflation report this week after data Tuesday showed consumer prices rising more than anticipated. 

The report raised questions about when the Fed will cut interest rates, with markets slightly trimming bets of a rate cut in June. 

Treasury yields rose as expectations for imminent rate cuts receded, with the 10-year yield climbing 10 basis points to 4.3%. The 2-year yield climbed to 4.69%.

At the same time, gold prices fell following a weeks-long run-up that took gold to record highs earlier this week. Gold has been buoyed by expectations for rate cuts because lower interest rates make bonds comparatively less attractive.

Cryptocurrencies tumbled Thursday, also hit by rising Treasury yields and interest rate uncertainty. Bitcoin fell below $70,000 after climbing above $73,000 yesterday. 

Macy’s Rises After Agreeing to Discuss Takeover Bids

March 14, 2024 02:33 PM EDT

Shares of Macy’s (M) rose Thursday after Arkhouse Management, one of the two investment firms offering to take the department store private for $6.6 billion, said in a regulatory filing that Macy’s had agreed to confidentially share financial information with the firms. 

Arkhouse and Brigade Capital first proposed buying Macy’s in December when they offered to buy all outstanding shares for $21 a piece. Macy’s rebuffed that offer in January, leading Arkhouse and Brigade to nominate nine people to the retailer’s board of directors in February. It then upped its offer to $24 per share in March after the company reported better-than-expected earnings and unveiled a turnaround plan that involved closing 150 locations. 

Shares of Macy’s were up 3.4% at $21.49, their highest level in more than a year, on Thursday afternoon. They have risen about 7% so far this year.

Microsoft Climbs to All-Time High

March 14, 2024 02:14 PM EDT

Microsoft (MSFT) shares reached a record high during intraday trading Thursday after the company announced that it would be expanding the regions that it offers Oracle Database@Azure in partnership with Oracle (ORCL) and adding additional availability and purchase options to Copilot, its artificial intelligence (AI) assistant, for individuals and organizations, rather than only enterprise customers.

The company unveiled Microsoft Copilot for Security on Wednesday, saying that the AI-power security solution is set to be available on April 1. Earlier in the week, Microsoft announced a quarterly dividend.

Microsoft has established itself as an early leader of the AI boom through its partnership with ChatGPT maker OpenAI.

Shares were up about 2.7% trading at $426.30 Thursday afternoon after climbing as high as $427.82 earlier in the day.

–Naomi Buchanan

Google Partner UiPath Falls Following Earnings Beat, Weaker-Than-Expected Guidance

March 14, 2024 01:58 PM EDT

UiPath (PATH) shares sank in intraday trading Thursday as the artificial intelligence (AI) software provider and Google partner’s weaker-than-expected guidance offset strong results.

UiPath predicted current-quarter revenue of $330 million to $335 million, missing analyst projections. The full-year revenue outlook of $1.555 billion to $1.560 billion exceeded forecasts.

The company posted its first profit as a publicly traded company in the fourth quarter, with operating income of $15.1 million. Adjusted earnings per share (EPS) came in at 22 cents, and revenue was up 31% from a year ago to $405.3 million. Both were above estimates.

Shares of UiPath were down 7% at $22.36 Thursday afternoon but have gained about 58% over the past year. 

–Bill McColl

Under Armour Stock Slumps Following CEO, Board Shakeup

March 14, 2024 12:46 PM EDT

Under Armour (UA) shares tumbled in intraday trading Thursday, a day after the company announced a change in corporate leadership.

As of April 1, Under Armour founder Kevin Plank will return to the company in the chief executive role, replacing Stephanie Linnartz, who will step down after just over a year leading the apparel company. Linnartz will stay with the company in an advisory role through the end of April.

Plank will be Under Armour’s third CEO since he originally left the post in 2019. Plank had remained on the company’s board as he was succeeded by Patrik Frisk, who resigned in May 2022.

The sudden leadership change raised some concerns among analysts and investors. Wedbush analysts said it “brings a layer of inconsistency and uncertainty” adding, “we believe that this move will make the sentiment hurdle that the company needs to overcome even higher.”

Under Armour shares were down 11.2% at $6.90 early Thursday afternoon. They’ve lost more than 18% of their value in 2024 so far.

–Aaron McDade

MicroStrategy To Raise $500M To Buy More Bitcoin

March 14, 2024 12:11 PM EDT

MicroStrategy is doubling down on Bitcoin, issuing hundreds of millions of dollars in convertible debt to bulk up its holdings as the cryptocurrency notches all-time highs. 

On Wednesday afternoon, the software company said it would launch a $500 million offering of senior convertible notes, the proceeds from which it would use for general corporate purposes and to buy more bitcoin.

The announcement came just two days after MicroStrategy closed a similar $800 million offering, which was also undertaken to fund bitcoin purchases. 

That same day, MicroStrategy Executive Chair and Bitcoin bull Michael Saylor said in a post on X that the company had used the proceeds to purchase 12,000 bitcoin for approximately $822 million. Its bitcoin holdings now total about 205,000 bitcoins, which on Thursday afternoon would be worth about $14.5 billion. 

MicroStrategy shares fell more than 6% Thursday as the price of bitcoin tumbled below $71,000. The stock has gained about 160% so far this year, outperforming bitcoin itself, with which the stock often moves in tandem. Bitcoin is up just 66% year-to-date. 

Dick’s Sporting Goods Stock Surges on Earnings Beat, Higher Dividend

March 14, 2024 11:15 AM EDT

Dick’s Sporting Goods (DKS) shares surged in early trading Thursday after the retailer posted fourth-quarter earnings that significantly surpassed analyst estimates for the holiday quarter.

For the quarter ended Feb. 3, the largest U.S. sporting goods chain posted $3.88 billion in net sales, a record high, along with adjusted income and earnings per share (EPS) of $320 million and $3.85, respectively. Each of those figures surpassed the consensus among analyst estimates compiled by Visible Alpha.

The company declared a quarterly dividend of $1.10 per share, up 10% from the previous quarterly dividend. It is set to be paid on April 12 to stockholders of record when markets close on March 29.

Shares of Dick’s were up 12.7% at $211.50 late Thursday morning, after moving as high as $221.69 in the opening minutes of trading. The stock has gained about 45% since the start of the year.

–Aaron McDade

Oil Advances to 2024 High as IEA Project Supply Deficit

March 14, 2024 10:42 AM EDT

The world is likely to face an oil shortage this year rather than the surplus previously expected, said the International Energy Agency on Thursday. 

The intergovernmental body revised its expectations for the full year. It now expects OPEC+ members to maintain previously announced production cuts throughout 2024. Global supply is still expected to increase by 800 thousand barrels per day (kb/d) in 2024 because of higher output from non-OPEC members.

Though the agency sees greater demand than previously forecast. Global oil use is expected to rise by 1.7 million barrels per day (mb/d) in the first quarter of the year, more than previously expected. 

“On that basis, our balance for the year shifts from a surplus to a slight deficit,” the agency said. 

Oil futures rose to their highest level all year Thursday morning following the report. West Texas Intermediate (WTI) contracts climbed above $81 for the first time since November, while Brent crude topped $85. 

Fisker Plummets as EV Maker Reportedly Eyes Bankruptcy

March 14, 2024 10:06 AM EDT

Fisker (FSR) shares sank in early trading on Thursday amid reports the electric vehicle (EV) maker is considering filing for bankruptcy.

Two weeks ago, the EV maker issued warnings that its current resources weren’t enough to cover its costs, raising doubts that it could stay in business. Now, the Wall Street Journal is reporting the company has hired a firm to help with a restructuring that could include bankruptcy.

In a preliminary earnings report released late last month, Fisker revealed a quarterly operating loss of $103.5 million. The company at the time said it was in talks with a “large automaker” about transactions that could include investment or joint development of an EV platform.

Shares plummeted more than 47% to 17 cents per share on Thursday, bringing the stock’s one-year decline to 97%.

–Terry Lane

Stocks Making the Biggest Moves Premarket

March 14, 2024 09:15 AM EDT

Gains:

• Robinhood Markets Inc. (HOOD): Shares of the online brokerage and trading platform gained 11% after it reported a jump in trading volume in February. 
• Dick’s Sporting Goods Inc. (DKS): Shares of the sports apparel and equipment retailer jumped 8% after it beat fourth-quarter sales and earnings estimates, and raised its dividend. 
• Dollar General Corp. (DG): Shares of the discount retailer rose more than 4% after it forecast full-year sales well above analysts’ estimates as cash-strapped shoppers turn to it for low-cost essentials. 

Losses:

• Fisker Inc. (FSR): Shares tumbled more than 40% to less than 20 cents per share after the Wall Street Journal reported the electric vehicle maker was considering filing for bankruptcy. 
• SentinelOne Inc. (S): Shares of the cybersecurity firm fell 9% after it forecast lower-than-expected full-year sales, overshadowing its quarterly earnings coming in slightly ahead of estimates. 
• Under Armour Inc. (UAA): Shares of the athletic apparel maker fell 6% after it announced founder Kevin Plank was returning to the position of CEO, replacing Stephanie Linnartz after only about a year in the role. 

Stock Futures Rise Ahead of PPI

March 14, 2024 08:27 AM EDT

Futures contracts connected to the Dow Jones Industrial Average were up about 0.4% in premarket trading on Thursday.

S&P 500 futures traded 0.3% higher.

Nasdaq 100 futures were up 0.4% about an hour before markets opened.

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