Stock Market Pulse

U.S. stock indexes dropped significantly on Tuesday due to hot job market data suggesting the Federal Reserve might maintain high-interest rates. Unexpected growth in U.S. job openings for August raised concerns about a constricted labor market, especially with the upcoming key monthly jobs report on Friday. The 10-year Treasury note yield reached 4.75%, its highest since 2007. And the average rate on 30-year fixed mortgage is now around 8%.

These stocks were making moves Tuesday:

💰 CCL reported Q3 earnings of $0.86 per share, beating expectations, with revenues rising by 59.2% year/year to $6.85 billion.

📈 The company raised its FY23 earnings outlook and expects lower fuel consumption, improving profitability.

🚢 For Q4, CCL anticipates adjusted EBITDA of $800 million to $900 million and positive trends in occupancy and per diems.

📊 Strong booking position for 2024 suggests robust consumer demand and pricing power.

🌍 CCL's North America, Australia, and Europe segments outperformed expectations.

💰 Demand for cruises remains strong, with Q3 booking volumes setting records and running nearly 20% above 2019 levels.

🛢️ Challenges include cautious Q4 EBITDA guidance and sensitivity to fuel prices and currency exchange rates.

Stocks traded lower on Monday after the U.S. government avoided a shutdown and bond yields reached their highest levels since 2007.

Pershing Square's Bill Ackman warned of an economic slowdown due to the Federal Reserve's aggressive rate hikes. Speaking on CNBC's "Squawk Box," Ackman expressed concerns about the economy's deceleration and the impact of high mortgage and credit card rates. He anticipates the 30-year Treasury rate might reach the mid-5% range, and the 10-year rate could approach 5%. Despite the economy's current strength, Ackman noted signs of weakening. He also highlighted challenges for investors, especially in the commercial real estate sector, who borrowed at low fixed rates and are now facing repricing. Additionally, U.S. regulators approved Ackman's unique SPAC structure, named "SPARC".

Tesla's Q3 vehicle deliveries fell short of Wall Street expectations, leading to a 0.1% decline in its stock; Sphere Entertainment's shares climbed 10% after the debut of its Las Vegas Sphere venue; crypto-tied stocks, including Riot, Marathon Digital, Coinbase, and MicroStrategy, advanced alongside a crypto rally; Discover Financial Services surged nearly 6% after an 8K filing disclosed an agreement with the FDIC; gold and silver miner stocks struggled due to dropping metal prices; Instacart's shares dropped around 5% amid reports of a weak second-half outlook; SolarEdge's stock decreased by 3.7% after a Barclays downgrade; Insulet's stock rose by 5% after a Jefferies upgrade; Norfolk Southern's stock fell 3.2% post a Bank of America downgrade; Nvidia's shares went up 2.7% after Goldman Sachs' positive stance; Meta gained 1.7% after a positive reiteration by Truist; Apple's stock increased 1.2% after JPMorgan's reaffirmation; and Amazon rose 1.6% following UBS' continued buy rating.

This week, the focus shifts to the labor market with three significant reports set to release, providing insights into the broader economy and potential implications for the Federal Reserve's interest rate decisions. Key reports include the Job Openings and Labor Turnover Survey on Tuesday, ADP's September jobs report on Wednesday, and the official September jobs report on Friday, which is projected to report a gain of 155,000 jobs, down from August's 187,000, with a decrease in the unemployment rate to 3.7%.

The Federal Reserve's favored inflation measure, the PCE price index, rose less than anticipated in August, indicating headway in its battle against inflation. The core PCE, which excludes food and energy, increased by 0.1% for the month, marking the smallest monthly rise since November 2020. Consumer spending also saw a decrease from the previous month. The central bank has been aggressively raising interest rates since March 2022 to counter inflation, with market speculations suggesting a pause in further hikes. However, some Fed officials anticipate interest rates to remain high for a prolonged duration.

The Dow Jones Industrial Average and S&P 500 declined on Friday due to concerns about a potential U.S. government shutdown and despite positive early-session responses to data suggesting easing inflation. For September, the market is anticipated to see significant losses, marking one of the most challenging months this year.

In terms of stock movers, Nike surged by 7% after reporting first-quarter profits that surpassed expectations and shared a drop of 10% in its inventories. In the same sector, Foot Locker increased by 1.7%, Under Armour by 3.7%, and On Holding by 5.8%. Ford and General Motors dropped by 1.6% and 1.2% respectively due to the United Auto Workers union's decision to expand its strike, but Stellantis declined by just 1.1% because of progressive negotiations. Walgreens Boots Alliance saw a 5.1% boost in response to rumors of a potential new CEO. Blue Apron shares rocketed by 134% upon its acquisition announcement by Wonder Group. Carnival shares fell by 7.7% after forecasting a wider loss for its fiscal Q4, despite positive fiscal Q3 results. Brinker International increased by 3.1% after an upgrade by Stifel, while Ball also gained after an upgrade from Jefferies. Bumble enjoyed a 2.5% increase due to an upgrade from Loop Capital. Lastly, Tesla went up slightly by 0.2% despite facing a lawsuit from the Equal Employment Opportunity Commission and a revised sales estimate by Citi.

Stocks rose on Thursday, influenced in part by a slight decrease in the yield of the 10-year Treasury.

Ray Dalio, billionaire investor and founder of Bridgewater Associates, expressed concerns about the U.S. fiscal situation, forecasting a possible debt crisis. He emphasized the rapidly escalating U.S. debt, which surpassed $33 trillion, and linked its rise to increased federal spending over recent years. Dalio also predicted a potential slowdown in economic growth.

On the stocks front, CarMax saw a decline after reporting reduced revenue, while Jabil experienced growth following positive Q4 earnings. Chico's Fas will be acquired by Sycamore Partners, leading to a significant stock surge. Workday's stock decreased after revising its revenue growth target. Trimble gained after AGCO announced a significant investment. DigitalBridge Group shares rose after an upgrade by J.P. Morgan, and Peloton saw an uptick after partnering with Lululemon Athletica. Accenture's shares dropped due to Q4 revenue missing expectations, while Micron Technology experienced a decline after its fiscal Q4 report. Lastly, GameStop's stock dipped slightly after appointing Ryan Cohen as its new CEO.

The Dow Jones Industrial Average fell on Wednesday, adding to significant losses from the prior day, influenced by a rise in Treasury yields and oil prices. The Dow decreased by around 68 points, or 0.2%. Simultaneously, the S&P 500 remained relatively stable, and the Nasdaq Composite grew by 0.2%. The benchmark 10-year Treasury yield reached its peak since 2007, and U.S. crude futures increased by almost 3%. 

The energy sector led the gains, with significant companies such as Marathon Oil and Devon Energy climbing more than 4%. Recent market pressure is attributed to increasing rates and underwhelming economic data, primarily concerning inflation. Greg Bassuk, CEO of AXS Investments, expressed that heightened inflation rates and its impact on higher borrowing costs for businesses are primary concerns. 

September traditionally witnesses weaker stock performance, and current figures reflect this trend. Despite ongoing market volatility, some strong buying opportunities are anticipated in the upcoming weeks. 

In individual stock news, various media stocks, including Warner Bros. Discovery and Paramount Global, witnessed an upswing after the writer's strike ended. MillerKnoll shares surged by over 27% post their earnings report, while shares of ChargePoint and Blink Charging also increased. However, Amazon shares dipped by 1% following an antitrust suit filed by the Federal Trade Commission.

The Dow Jones Industrial Average experienced a decline on Tuesday following concerning reports on home sales and consumer confidence, resulting in the Dow dropping 388.00 points or 1.14% to 33,618, marking its worst performance since March. Additionally, the S&P 500 decreased by 1.47% to 4,273, and the Nasdaq Composite retracted by 1.6%. 

OpenAI has updated ChatGPT to include voice interaction and image processing capabilities, with voice options on its mobile app and image analysis available across platforms. Amid the evolving AI landscape and increased investments, concerns have arisen over the potential misuse of AI-generated synthetic voices for deepfakes, though OpenAI assures that voices were created with known voice actors and emphasizes not retaining audio clips, though transcriptions might be used for model improvement.

On the stock front, Amazon faced a 4% dip after the FTC's lawsuit, while Ford paused its $3.5 billion EV battery plant project and saw a 1.2% decline in its stock. Other notable stock movements included United Natural Foods dropping 27%, Fisker rising 9.8%, Rivian Automotive gaining 5.4%, and various other companies like Cintas, Ferguson, Sirius XM Holdings, DraftKings, and Costco witnessing significant fluctuations.

On Monday, as Wall Street commenced the final week of a challenging September for stocks, shares largely trended upwards. Throughout the week, investors will closely watch U.S. inflation figures and keep an eye on Congressional talks to prevent a government shutdown. 

Writers in Hollywood have come to a tentative agreement with studios, signaling an end to a strike that spanned nearly five months. The Writers Guild of America praised the three-year deal for its significant benefits to writers. In response, media stocks showed varied performances: Paramount Global dipped by 0.2%, Warner Bros. Discovery dropped 2.8%, Netflix increased by 1%, Walt Disney decreased by 0.5%, and Amazon.com grew by 1.8%, with Warner Bros. being the S&P 500's primary decliner. 

In other news, Amazon plans to invest up to $4 billion in the AI company Anthropic, securing a minority stake. Amazon's cloud clients will gain early access to Anthropic's tech via Amazon Bedrock, and Amazon Web Services will become Anthropic's main cloud provider.

The following stocks also captured attention on Monday:

Alcoa shares fell 5% after announcing executive vice president William Oplinger will succeed Roy Harvey as CEO and president, and join the board of directors. Nio saw its U.S.-traded shares decline by about 1% after refuting media claims of raising up to $3 billion from investors. Li Auto shares dropped 9% on news of Huawei entering the electric vehicle space. GE HealthCare Technologies stocks went up 3% after declaring a Q3 cash dividend. Williams-Sonoma rose 9% as Green Equity Investors disclosed a 5% stake. Dow Inc. saw a 2% rise after an upgrade by JPMorgan due to potential benefits from rising oil prices. Opendoor Technologies decreased by nearly 6% after Citi lowered its target price. JD.com U.S.-listed shares slid 2% due to growing concerns about China's economy. Sealed Air went up 2.7% after Citi's upgrade. Chefs’ Warehouse shares increased 1% after UBS started its coverage with a buy rating. Lastly, Hudson Technologies grew 4% after Canaccord Genuity's buy rating initiation.

Stocks were trading mixed Friday following the S&P 500‘s 1.6% drop on Thursday, its worst day since March, as investors reacted to signals from the Federal Reserve that it could keep interest rates higher for longer. Bill Ackman, CEO of Pershing Square Capital Management, anticipates that long-term interest rates will keep rising, especially for the 30-year bond currently at 4.55%. His forecast is driven by the U.S. economy's strong performance, significant infrastructure spending, and a growing national debt.

Here are the stocks making moves on Friday: 

Stocks fell Thursday after the Federal Reserve held interest rates steady but signaled that one more quarter-point rate hike was possible this year. The central bank also projected rate cuts in 2024, but not as many as it previously did. The Bank of England also left interest rates unchanged in a surprise move.

Here are the stocks making moves:

• Splunk (SPLK) shares soared 21% after Cisco Systems (CSCO) said it would acquire the cybersecurity and data analytics software company for $157 a share in cash.

• FedEx (FDX) shares rose 4.5% after the shipping company reported fiscal first-quarter earnings that beat analysts' estimates.

• KB Home (KBH) stock slid 4.3% after saying it expected its gross housing margin to shrink in the current quarter.

• Fox Corporation (FOXA) and News Corp (NWSA) shares gained 3.2% and 1.3%, respectively, on news that Rupert Murdoch is stepping down as chairman of both companies.

• Broadcom (AVGO) shares moved lower by almost 2.7% after a report that Google is holding internal discussions about dropping the AI chip supplier in favor of its own internally developed chips as soon as 2027.

• Eli Lilly (LLY) shares were down 3.4% after the company sued several clinics and pharmacies across the U.S. for allegedly selling cheaper, unauthorized versions of the company's diabetes drug Mounjaro.

• Klaviyo (KLVO) stock closed Thursday roughly 2.9% higher.

• PulteGroup (PHM), Zillow Group (ZG), and D.R. Horton (DHI) shares fell Thursday after data showed U.S. existing home sales fell in August as tight supply raised prices.

• FedEx (FDX) shares gained 4.4% a day after the company reported mixed fiscal first-quarter earnings.

• Paramount (PARA), Netflix (NFLX), and Disney (DIS) shares moved higher as writers and producers neared a potential end to the Writers Guild of America strike.