Check back for updates throughout the trading day
Updated at 5:18 pm EDT
U.S. stocks extended gains Tuesday, setting up a fresh series of all-time highs for the three major indexes, as investors picked through a key retail sales reading that could further cement the case for an autumn rate cut from the Federal Reserve.
The S&P 500 rose 0.64% to 5,667.20, yet another record closing high. It wasn't just the S&P 500 that moved up today, though. The Russell 2000 Small Cap Index skyrocketed 3.5% as interest shifted away from big cap technology to smaller companies and other industries. The Russell 2000 ETF (IWM) is up over 10% since July 10th.
Related: Forget Nvidia, it may be time to buy small-cap stocks
The Dow Jones Industrial Average wasn't a slouch, either. It rose 1.9% on the session.
Gains on just four stocks generated more than 60% of the Dow's 743-point gain: UnitedHealth Group (UNH) , up 6.5% on the day. That contributed 220 points to the Dow. The others were: Caterpillar (CAT) , up 4.3% and worth 97 Dow points; Goldman Sachs (GS) , up 2.2% and worth 70.9 points; and Home Depot (HD) , up nearly 3% and worth 70 points for the index. 26 stocks were up and four down.
Updated at 2:18 p.m. EDT
Earnings and target-price estimates
ASML Holding, (ASML) the developer and producer of semiconductor equipment systems for chipmakers, reports earnings July 17. The company, which has beaten earnings estimates for four quarters running, is expected to post earnings of $4.06 a share on revenue of $6.56 billion. Analysts’ average price target is $1,145, up nearly 8% from its current price of $1,062.
Johnson & Johnson (JNJ) reports earnings on July 17. Analysts' EPS estimates have increased to $2.70 from $2.52 in the past 30 days. Revenue is expected to be $22.31 billion.
Elevance Health, (ELV) a health insurance provider, has considerable upside, according to analysts. Its average price target is $612.08, marking more than an 11% increase from its current price of $549.20. EPS is forecast to be $10.01 and revenue is expected to be $43.05 billion.
Prologis, (PLD) the California-based real estate investment trust that invests in logistics facilities, has beaten earnings estimates the past four quarters. Analysts expect EPS of 59 cents and revenue of $1.87 billion.
US Bancorp (USB) is getting mixed reviews from Yahoo Finance analysts. In the past 30 days, six analysts have revised their earnings estimates, three increasing them and three cutting. Overall, the company is expected to report earnings of 94 cents a share, and $6.79B in sales.
-- Liam Elias
Updated at 11:57 AM EDT
Nike lift
Nike (NKE) shares are getting a boost from a stronger-than-expected second quarter earnings report from its German rival Adidas, which posted a 9% increase in overall sales and lifted its full-year profit forecast.
Adidas still expects headwinds from a weaker euro, but sees currency-neutral profits rising to €1 billion this year, a €300 million improvement from its prior forecast.
Nike shares were last marked 1.44% higher in mid-day trading and changing hands at $72.35 each.
Related: Analysts overhaul Nike stock price targets after earnings
Updated at 11:17 AM EDT
Dow unbowed
The Dow is testing the 41,000 point mark amid a 616 point surge in early trading, powered in part by an outsized gain for UnitedHealth Group and further bets on a second term for former President Donald Trump that would boost tariffs on imported goods and boost the value of domestic stocks.
The Russell 2000 index, meanwhile, was marked 2.1% higher, extending its five-day surge to around 10% and pegging the small-cap benchmark at the highest levels of the year.
The Dow is flying today.$DJIA is up about 1.4% and may end up with its best single-day charge since Nov 2nd.
— John Kicklighter (@JohnKicklighter) July 16, 2024
Quite the contrast to the S&P 500 and Nasdaq 100: pic.twitter.com/xZv5zQIwFQ
Updated at 9:34 AM EDT
Solid open
The S&P 500 was marked 15 points, or 0.28% higher in the opening minutes of trading, while the Nasdaq gained 62 points, or 0.33%. The Dow was last marked 186 points to the upside.
S&P 500 Opening Bell Heatmap (Jul. 16, 2024)$SPY +0.28%🟩$QQQ +0.3`%🟩$DJI +0.5`%🟩$IWM +1.12%🟩 pic.twitter.com/uFda2ANjQ3
— Wall St Engine (@wallstengine) July 16, 2024
Updated at 8:48 AM EDT
Soft landing?
A better-than-expected reading for June retail sales, alongside cooling inflation pressures and a weakening labor market, is adding to bets that the Fed can achieve a so-called 'soft landing' for the world's biggest economy.
Retail sales were flat in June, and pegged at just under $705 billion, but the so-called control group reading which feeds into GDP calculations rose 0.9%, well ahead of Street forecasts.
U.S. equity futures extended earlier gains following the data release, with contracts tied to the S&P 500 suggesting a gain of around 7 points while the Dow was called 120 points to the upside. The Nasdaq, meanwhile, is priced for a 50 point bump.
Benchmark 10-year Treasury note yields rose 5 basis points to 4.212% following the data release, while 2-year notes were up 4 basis points to 4.453%.
Retail Sales ex-gas and autos +0.8% MoM
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) July 16, 2024
Hasn't been higher since Jan 2023 pic.twitter.com/enKS2GMmIL
Updated at 8:00 AM EDT
Mixed banks
Bank of America (BAC) shares jumped higher in premarket trading, rising 2.4% to $42.90 each, after the lender posted stronger-than-expected second quarter earnings of 83 cents per share and said net interest income, the gap between it loan earnings and its deposit payouts, would rise to $14.5 billion by the fourth quarter.
Morgan Stanley (MS) shares, meanwhile, slumped 2.4% after muted revenues of $6.79 billion from its key wealth management division offset an otherwise solid set of second quarter earnings
House always wins. $BAC pic.twitter.com/YlLpPsddDD
— Bespoke (@bespokeinvest) July 16, 2024
Stock Market Today
Stocks ended higher again Monday, with the Dow Jones Industrial Average closing at an all-time high. Investors continued to rotate out of megacap tech stocks into smaller, more cyclical names as Fed interest-rate-cut bets further solidified.
The Russell 2000 in fact extended its recent run of gains to close at its highest since January 2022, helped in part by bets that a second administration for President Donald Trump would support domestic stocks and by dovish comments from Fed Chairman Jerome Powell during an event at the Economic Club of Washington.
Related: Trump shooting has major impact on stocks, Treasury bonds
Powell said that while inflation had remained stubbornly elevated over the first three months of the year, "three readings in the second quarter, including the one from last week, do add somewhat to confidence” that it's returning to the Fed's preferred 2% target.
Getty
The CME Group's FedWatch is pricing in only a small chance of a rate cut when the Fed meets later this month, but it sees the odds of a September cut at around 86%, with bets on a 0.5-percentage-point reduction starting to form as well.
Bond markets were also reflecting the lower-rate assumptions, with benchmark 10-year Treasury note yields easing to 4.175% heading into the start of the New York trading session and 2-year paper trading at 4.4157%.
Related: Apple at record high as analysts revamp stock price targets
On Wall Street, stocks are looking at a modestly firmer open ahead of retail sales data for June at 8:30 am Eastern Time. Economists expect to see a pullback in overall spending amid a weakening job market.
Futures contracts tied to the S&P 500 suggest a 10 point opening bell gain, while those linked to the Dow Jones Industrial Average are priced for a 57 point advance.
The tech-focused Nasdaq, meanwhile, is called 40 points higher with a premarket decline for Nvidia (NVDA) offsetting gains for Tesla (TSLA) and Apple (AAPL) .
US Small Caps are up 6.8% over the last 3 trading days while US Large Caps are flat. The 6.8% spread is 6 standard deviations above the mean & the 3rd largest small outperformance since inception of the first small cap ETF in May 2000. $IWM $SPYhttps://t.co/l5IYmkf6Ih pic.twitter.com/7gYUtiaMEa
— Charlie Bilello (@charliebilello) July 15, 2024
UnitedHealth Group (UNH) shares were a notable early mover, falling 2% in the premarket after the health-care giant posted stronger-than-expected second-quarter earnings but held to its full-year profit outlook.
More Wall Street Analysts:
- Analyst revisits Nvidia stock price target after Blackwell checks
- Analysts prescribe new Walgreens stock price targets after earnings
- Analyst revises Facebook parent stock price target in AI arms race
In overseas markets, a muted reading for a key investor sentiment survey in Germany kept stocks in check, with the regional Stoxx 600 benchmark falling 0.37% in Frankfurt and Britain's FTSE 100 slipping 0.22% in London.
Overnight in Asia, former President Donald Trump's selection of China hawk J.D. Vance as his running mate added more pressure to Asia shares. The regionwide MSCI ex-Japan benchmark fell 0.39% into the close of trading.
Japan's Nikkei 225, meanwhile, nudged 0.2% higher on its return from Monday's Marine Day holiday, helped in part by a weaker yen. The Japanese currency was likely the beneficiary of billions in currency-market intervention by the Ministry of Finance late last week.
Related: Veteran fund manager sees world of pain coming for stocks
