Stocks End Higher as Treasury Yields Stabilize

S&P 500 Gains and Losses Today

November 10, 2023 05:30 PM EST

Hologic (HOLX) shares climbed 7.3% after the medical technology firm reported better-than-expected quarterly results and announced a $500 million accelerated stock buyback plan.

Broadcom (AVGO) shares picked up 5.1% on optimism that the semiconductor’s planned $61 billion purchase of VMWare (VMW) will receive approval from regulators. VMWare shares increased 0.4%. 

Meta Platforms (META) shares advanced 2.6% following reports that the social media and metaverse company would be getting back into the Chinese market by selling a lower-priced virtual reality headsets in that country.

Illumina (ILMN) shares plunged 8.1%, making it the biggest decliner in the S&P 500, after the biotech company’s revenue was short of forecasts, and the firm cut its outlook on slowing demand for its genetic research equipment. It said that customers are being more cautious about spending.

Wynn Resorts (WYNN) shares tumbled 5.7% as the recovery of business from COVID-19 lockdowns at the casino operator’s Macau locations was less than hoped. Jefferies downgraded the stock and slashed its price target.

Arista Networks (ANET) shares dropped 2.3% amid concerns about the cloud networking product maker’s long-term guidance.

–Bill McColl

Dow Surges 400 Points, Posts Second Straight Winning Week

November 10, 2023 04:47 PM EST

The Dow Jones Industrial Average rebounded from yesterday’s drop to move higher by 391 points, or 1.16%, as investors weighed the latest comments from Federal Reserve officials. The Dow finished the week higher by about 0.7%, its second-consecutive week in the green as it follows up on the prior week’s blockbuster results. 

Intel (INTC)  shares jumped by 2.8% to close at $38.86, equalling its highest share price since June 2022. 

Microsoft (MSFT) surged up by 2.5% to close at $369.67, its third record-high close in the past four sessions. It was part of a 2.6% increase in the technology sector, with Apple (AAPL) gaining 2.3%, Salesforce (CRM) moving up by 1.7%, and IBM (IBM) rising by 1.6%. 

Caterpillar (CAT) shares moved higher by 2.4% to break a four-session losing streak. Dow Inc. (DOW) gained 2.3%. 

The Walt Disney Company (DIS) fell 2.5% to give back some of its gains from this week’s earnings results, which included the media giant reporting 13% growth in its parks and experiences business unit. Merck & Co. (MRK), Nike (NKE) and Johnson & Johnson (JNJ) were the only other decliners in the session.

–Terry Lane

Illumina is Biggest S&P 500 Decliner, Shares Hit a 10-Year Low

November 10, 2023 03:57 PM EST

Illumina (ILMN) shares fell to their lowest level in a decade after the genetic research equipment manufacturer missed revenue estimates and slashed its guidance as customers pulled back on spending.

Illumina now expects full-year revenue to fall 2% to 3%, down from its previous estimate of a gain of 1%. It sees earnings per share (EPS) in a range of $0.60 to $0.70, versus its earlier forecast of $0.75 to $0.90.1

CEO Jacob Thaysen, who took on the role in September, said the macroeconomic environment “remains challenging for our industry and for our customers.” He added customers have become “increasingly cautious and constrained” in their purchasing decisions. 

Illumina was down 8% in late trading Friday and was the worst-performing stock in the S&P 500.

–Bill McColl

Maker of Johnny Walker & Smirnoff Warns on Profit, Shares Tank

November 10, 2023 02:47 PM EST

Shares of Diageo (DEO) plunged after the world’s largest spirits maker warned its profit and revenue will be hurt by falling demand in Latin America and the Caribbean.

The owner of such brands as Johnnie Walker whisky, Smirnoff Vodka and Guinness beer said that it anticipates slower growth in the first half of fiscal 2024 than in the second half of fiscal 2023. It said that was because of “a materially weaker performance outlook in Latin America and Caribbean,” which accounted for almost 11% of the company’s net sales in 2023.

Diageo explained that it sees organic net sales tumbling by more than 20% year-over-year in Latin America and the Caribbean. The company pointed to “macroeconomic pressures in the region” that are resulting in lower consumption and consumer down-trading. It added that those impacts “are slowing down progress in reducing channel inventory to appropriate levels for the current environment.” 

Diageo’s outlook for its other four regions – North America, Africa, Europe, and Asia Pacific – calls for increasing revenue during the first half. However, it expects overall organic operating profit growth in the period to be below 2023’s gains. 

Diageo American Depositary Receipts traded in the U.S. were down 11% in mid-afternoon trading Friday, at their lowest level in three years.

–Bill McColl

Michigan Consumer Sentiment Index Fell for 4th Straight Month

November 10, 2023 01:35 PM EST

High borrowing costs and persistent worries about inflation are beginning to drag more heavily on consumers’ optimism over the economy, according to consumer sentiment survey results that showed a decline for the fourth-consecutive month. 

The Michigan Index of Consumer Sentiment preliminary November reading of 60.4 was lower than the 63.7 survey result that economists expected to see and a sharp drop from the 63.8 reading for October.

The steep decline in sentiment was spurred by growing concerns about the negative impact that high interest rates are having. “Overall, lower-income consumers and younger consumers exhibited the strongest declines in sentiment,” wrote Joanne Hsu, director of the University of Michigan’s survey of consumers.

The closely-watched survey comes as Federal Reserve Chair Jerome Powell has said that interest rates could need to be raised even further to combat inflation. The current federal funds interest rate is at a 22-year high at 5.25% to 5.5%, which has pushed rates higher for other loans, like mortgage rates that are currently around 7.9, just lower than 30-year high rates hit in October.  

The monthly survey also showed that consumers’ view of current economic conditions dropped almost 7% to 65.7 in November, down from October’s 70.6, while the index of consumer expectations declined 4% to 56.9 from 59.3. 

–Terry Lane

Midday Market Movers

November 10, 2023 01:10 PM EST

Hologic (HOLX): The medical technology company’s shares were up 6% after the company posted better-than-expected results and announced a $500 million accelerated share repurchase program. 

Meta Platforms (META): Shares rose 2.1% after a report the social media giant would be returning to the China market by selling a lower-priced virtual reality headset there.

Broadcom (AVGO): Shares advanced 4% on optimism the chipmaker’s $61 billion acquisition of VMWare (VMW) will get regulatory approval. 

Illumina (ILMN): Shares of the biotech company tumbled 12% as it it slashed its guidance on slowing demand for its genetic research equipment.

Wynn Resorts (WYNN): The casino operator’s shares fell 5.3% as revenue at its Macau location was less than anticipated.

The Trade Desk (TTD): Shares of the ad technology provider dropped 18% after the company gave lower-than-expected guidance on a pullback in advertising spending in certain businesses.

–Bill McColl

5 Things to Know Before Markets Open

November 10, 2023 09:15 AM EST

Here’s what investors need to know to start their day:

1. Meta Platforms (META) reportedly reached an agreement with Tencent Holdings to sell a new, lower-priced version of its virtual-reality headset in China, opening the country to the social media giant 14 years after a ban.
2. The Trade Desk (TTD) shares plummeted 24% in the pre-market after the ad-tech company reported fourth-quarter revenue guidance of $580 million, below the $610 million that analysts expected.
3. Chinese media reports indicated that the U.S. chipmaker Nvidia (NVDA) had developed three new high-end chips that it could sell to Chinese companies while staying in compliance with U.S. curbs on chips sales to China.
4. Shares of Plug Power (PLUG) tumbled 34% in pre-market trading after it reported being squeezed by supply issues and inflationary costs, as the company said it will need additional capital to fund its operations.
5. At 10 a.m. ET, the Michigan Consumer Sentiment Index preliminary reading for November is expected to fall to 63.7 from October’s 63.8 figure.

Futures tied to the S&P 500 were up about 0.3%.

November 10, 2023 08:54 AM EST