Market Overview
The stock market entered the new week with a continuation of last week's rally. A last-minute push higher had the S&P 500 (+1.0%), Nasdaq Composite (+1.4%), Dow Jones Industrial Average (+0.6%), and Russell 2000 (+1.2%) hitting new session highs ahead of the close. Today's action left the S&P 500 1.1% below its all-time high.
Trading Volume
Volume was below-average at the NYSE today as investors await potentially market-moving events this week. Key events include the release of the FOMC Minutes for the July 30-31 FOMC meeting on Wednesday and Fed Chair Powell's speech on the Economic Outlook at the Jackson Hole Economic Symposium on Friday. Participants are looking for Mr. Powell to corroborate the market's optimistic views on economic growth, the labor market, and rate cuts beginning in September, which have driven recent upside moves in equities.
Economic Releases
Influential economic releases include:
- Weekly initial jobless claims and existing home sales report for July on Thursday
- New home sales report for July on Friday
Earnings Reports
Earnings reporting in the retail space picks up steam this week. Notable mentions include:
- Lowe's (LOW 243.21, +2.06, +0.9%)
- Target (TGT 144.63, +0.59, +0.4%)
- TJX (TJX 112.49, +1.04, +0.9%)
- Urban Outfitters (URBN 41.17, +0.43, +1.1%)
- Dollar Tree (DLTR 100.51, +1.73, +1.8%)
Sector Performance
Broad buying activity left all 11 S&P 500 sectors higher, led by communication services (+1.4%) and information technology (+1.4%).
Bond Market
The 10-yr note yield settled two basis points lower at 3.87%, and the 2-yr note yield rose one basis point to 4.07%.
Year-to-Date Performance
- Nasdaq Composite: +19.1% YTD
- S&P 500: +17.6% YTD
- S&P Midcap 400: +9.3% YTD
- Dow Jones Industrial Average: +8.5% YTD
- Russell 2000: +6.9% YTD
Economic Data
Today's economic data was limited to the Leading Indicators Index, which dropped 0.6% in July (consensus -0.3%) following a 0.2% decline in June. There is no economic data of note on Tuesday.
Guru Stock Picks
Brandes Investment Partners, LP has made the following transactions:
Today's News
Tesla (TSLA, Financial) is making significant strides in its Optimus humanoid robot project, aiming to enhance factory efficiency and safety. The company is hiring for a "Data Collection Operator" role, which involves employees wearing a motion capture suit and virtual reality headset to perform specific movements. This data collection is crucial for training the Optimus robot. The job offers up to $48 per hour and requires physical endurance, such as walking for over seven hours a day while carrying up to 30 pounds.
Palo Alto Networks (PANW, Financial) reported impressive Q4 results with a Non-GAAP EPS of $1.51, beating estimates by $0.10. Revenue for the quarter reached $2.2 billion, marking a 12.8% year-over-year increase. For the fiscal year 2025, the company expects revenue between $9.10 billion and $9.15 billion, with a Non-GAAP net income per share ranging from $6.18 to $6.31. The company also projects an adjusted free cash flow margin of 37% to 38%.
Intel (INTC, Financial) announced a significant workforce reduction of 15%, equivalent to approximately 15,000 employees, to achieve $10 billion in cost savings by 2025. The cuts will mainly affect the sales and marketing group, aiming to reduce costs by 35% by the end of the year. Despite these measures, Intel remains committed to supporting its ecosystem and channel partners.
Maxeon Solar Technologies (MAXN, Financial) saw a remarkable 46.2% surge in trading after hitting an all-time low. The company is planning to start construction on its Mesa del Sol project in New Mexico by Q4, despite previous delays. Vanguard Group also increased its stake in Maxeon Solar, purchasing an additional 117,594 shares, bringing its total ownership to approximately 2.3% of the company.
Nikola Corp (NKLA, Financial) faced heavy selling pressure after announcing plans to sell up to $160 million in senior notes convertible into shares. The initial sale of $80 million is expected to yield $74.3 million in net proceeds. The company also filed a shelf registration to sell up to $500 million in shares, including debt securities, to raise funds for ramping up production of its hydrogen fuel electric vehicles.
Paramount Global (PARA, Financial) is extending the deadline for rival bids if Edgar Bronfman Jr. makes an offer before the current deadline. Bronfman is expected to make a bid soon, and if it is superior to the existing deal with Skydance, the deadline may be extended to September 5. Bronfman has had discussions with private equity firm Bain Capital and Roku (ROKU) about a potential bid.
Newmont (NEM, Financial) received an upgrade to Sector Outperform from Scotiabank, with a price target of $59. The bank expects operational improvements and margin expansion in the second half of 2024. Conversely, AngloGold Ashanti (AU, Financial) was downgraded due to strong stock price appreciation, up more than 70% year-to-date.
Rubrik (RBRK, Financial) announced a partnership with Salesforce (CRM, Financial) to provide data protection services. This marks Rubrik's third major SaaS application support, following Microsoft M365 and Atlassian Jira. The partnership aims to enhance data protection capabilities for Salesforce admins, IT, and security leaders.
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