Stocks open lower Wednesday
Stocks opened lower Wednesday.
The Nasdaq Composite lost 0.3%, while the Dow Jones Industrial Average fell 65 points, or 0.2%. The S&P 500 lost 0.3%.
— Sarah Min
Key regional bank stock could climb as much as 50%, according to Atlantic Equities
Atlantic Equities is bullish on a regional bank stock that recently acquired a peer firm.
Analyst John Heagerty highlighted “a combination of an attractive valuation, the strong likelihood of a supportive buyback in 2024 and an under-appreciated business model” as underpinning the optimistic outlook.
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— Brian Evans
A partnership with Amazon will help grow Pinterest stock, Wells Fargo says
Wells Fargo says a partnership later this year with retail giant Amazon will help Pinterest stock climb.
The firm upgraded shares of Pinterest on Tuesday. Pinterest stock climbed more than 4% in premarket trading.
“We believe Pinterest is making the optimal strategic move to outsource monetization to third-parties to overcome its attribution and scale challenges,” analyst Ken Gawrelski wrote. “This includes an announced partnership with Amazon, now expected to be live in time for the 2023 holiday season, and future expected partnerships with other scaled retail media networks.”
Pinterest shares 1-day
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— Brian Evans
See the stocks making the biggest premarket moves
Morgan Stanley lists Delta Airlines as top stock pick
Morgan Stanley thinks Delta Airlines stock is poised for strong growth after the company’s investor day.
“This was not just a message of a rising tide – mgmt. presented a clear, convincing, data driven story of idiosyncratic brand/franchise strength which should drive premium demand upside in an upturn and resilience in a downturn,” analyst Ravi Shanker said of the investor day.
Delta stock added about 0.5% in premarket trading.
Delta stock.
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— Brian Evans
Mortgage demand grows, driven by sales of new homes
Mortgage rates turned higher again last week. But the increase did not cut into mortgage demand, as buyers sought newly built homes.
Total mortgage application volume rose 3% compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. An additional adjustment was made for the Juneteenth holiday.
Applications for a mortgage to purchase a home rose 3% for the week but were 21% lower year over year. These applications have increased for three straight weeks to the highest level since early May, despite still-high mortgage rates.
— Diana Olick
U.S. Treasury yields dip as investors weigh interest rate outlook
U.S. Treasury yields fell on Wednesday as investors considered the path ahead for interest rates and awaited fresh comments from Federal Reserve Chairman Jerome Powell. He is due to speak alongside central bank officials from around the world at a European Central Bank Forum in Portugal.
At 4:17 a.m. ET, the 10-year Treasury yield was down by less than one basis point to 3.7621%. The 2-year Treasury yield was last trading at 4.7472% after falling by almost two basis points.
Yields and prices have an inverted relationship and one basis point equals 0.01%.
— Sophie Kiderlin
Chinese yuan slips after weaker-than-expected mid-point fix
The onshore yuan slipped by 0.1% to around 7.23 yuan per U.S. dollar after China refrained from setting a stronger-than-expected fix for a third day in a row. The offshore yuan was trading similarly.
The People’s Bank of China set its daily mid-point reference rate for its managed currency at 7.2101 yuan per U.S. dollar, versus a Reuters estimate for 7.2092 yuan per U.S. dollar.
U.S. considering new chip restrictions on China: WSJ
The U.S. is considering new restrictions on exports of artificial intelligence chips to China, according to the Wall Street Journal.
Citing people familiar with the matter, the Journal reported the U.S. Commerce Department could stop shipments of chips made by Nvidia and other companies to customers in China as early as July.
Shares of mainland Chinese semiconductor companies tumbled on Wednesday, with SMIC losing 2.42% and Hua Hong Semiconductor sliding 3.19%
— Lim Hui Jie
China industrial profits sank 18.8% in first five months of 2023
China’s industrial firms recorded a 18.8% tumble in cumulative profits in the first five months of 2023 from the year before, official data showed on Wednesday.
This figure was 1.8 percentage points lower than the 20.6% decline in China industrial profits for January to April, China’s National Statistics Bureau said in a statement.
In monthly figures occasionally published by the NBS, China industrial profits contracted by 12.6% in May from a year earlier.
— Clement Tan
Australia weighted inflation rate slows to 5.6% in May, sharply below expectations
Australia’s weighted inflation rate for May came in at 5.6%, sharply lower than April’s figure of 6.8% and lower than the 6.1% expected by economists polled by Reuters.
Headline inflation for May came in at 5.8%, lower than April’s figure of 6.9%. It was the lowest recorded rate since April 2022.
— Lim Hui Jie
AeroVironment shares pop 5% in extended trading after earnings report
AeroVironment shares jumped more than 5% in extended trading after the military drone maker beat fiscal fourth quarter revenue expectations, and issued a better-than-expected full-year revenue outlook.
AeroVironment reported revenue of $186.0 million, greater than analysts’ expectations for $164.1 million, according to consensus estimates from Refinitiv. Additionally, the firm said it expects full-year revenue of $630 to $660 million, compared to estimates for $600 million.
AeroVironment shares 1-day
Chip giants drag Nasdaq 100 futures in afterhours trading
Futures tied to the Nasdaq 100 slid 0.3% as a host of big semiconductor companies slipped on Tuesday night.
Shares of Nvidia tumbled more than 2%, while Advanced Micro Devices and Marvell Technology each fell more than 1%. EV giant Tesla slid about 1%, as did semiconductor stock Broadcom.
The action comes after the tech-heavy Nasdaq Composite rebounded during regular trading earlier in the day. The index gained 1.65% as investors snapped up shares of tech companies.
–Darla Mercado
Powell to talk monetary policy at Portugal forum
Markets will be looking for clarity on Wednesday when Federal Reserve Chairman Jerome Powell joins a monetary panel discussion in Sintra, Portgual, at 9:30 a.m. ET.
The U.S. central bank leader will be joined by global counter parts Christine Lagarde, the president of the European Central Bank, along with Bank of England Governor Andrew Bailey and Kazuo Ueda, governor of the Bank of Japan.
Powell’s remarks come just two weeks after the Fed voted to hold interest rates steady as it evaluates the impact of 10 rate hikes totaling 5 percentage points since March 2022. In recent statements, the chairman has said he expects additional hikes, though at a slower pace.
Markets largely expect the Fed to increase rates one last time this cycle at its July meeting, then go into an extended pause. Fed officials, though, indicated at the June meeting that they see two more increases.
—Jeff Cox
Stock futures open lower
U.S. stock futures opened lower Tuesday night.
Dow Jones Industrial Average futures fell by 10 points, or 0.04%. S&P 500 futures and Nasdaq 100 futures dipped 0.08% and 0.14%, respectively.
— Sarah Min