Stock market futures are pointing down this morning, with the S&P 500, Nasdaq, and Dow Jones all set to open lower. This dip comes after the markets had a strong performance last week.
Several factors are contributing to the downward trend:
- Mega cap stocks are losing value.
- Semiconductor stocks are also down, especially after China decided to stop using Intel (INTC, Financial) and AMD (AMD, Financial) chips in its government computers.
- Higher Treasury yields are making it tougher for stocks, with the 2-year note yield up to 4.63% and the 10-year note yield at 4.24%.
There are no significant U.S. economic reports expected today.
Here's a quick look at some specific companies making headlines:
- Intel (INTC, Financial) and AMD (AMD, Financial) are both down after China's decision to block their chips in government computers.
- United Airlines (UAL, Financial) is facing more scrutiny from regulators.
- Digital World Acquisition Corp (DWAC, Financial) sees a rise as shareholders approve a merger with Trump Media & Technology Group Corp.
- Masimo (MASI, Financial) is up after announcing plans to possibly separate its consumer business and confirming its financial outlook.
- Zoom Video (ZM, Financial) introduces a new AI-powered platform and announces a partnership with Avaya.
- Walt Disney (DIS, Financial) gets an upgrade from Barclays.
Looking at the global markets, most Asian indices closed lower, while European markets are slightly down with Italy showing some gains. Notable developments include China's new regulations on chips, Japan's currency concerns, and meetings between Chinese officials and major company executives. In Europe, discussions around interest rate cuts and credit ratings are in focus.
Today's News
Boeing (BA, Financial) announced significant leadership changes, with CEO Dave Calhoun planning to step down by year-end. The aerospace giant is facing intense scrutiny over safety concerns, especially after a midflight emergency involving a 737 Max 9. The board has elected Steve Mollenkopf as the new independent board chair to oversee the CEO selection process, while Stephanie Pope takes over as president and chief executive of Boeing Commercial Airplanes. These moves come at a critical time for Boeing as it navigates through safety issues and regulatory scrutiny.
Qualcomm (QCOM, Financial), Intel (INTC, Financial), and Google (GOOG, Financial) (GOOGL) have joined forces in a consortium named UXL Foundation, targeting Nvidia's (NVDA, Financial) dominance in AI software. This collaboration aims to develop versatile AI accelerator chips software, challenging Nvidia's leading position in the sector. The initiative has seen mixed market reactions, with Nvidia's shares experiencing a slight drop in premarket trading.
Mizuho Securities has downgraded Tesla (TSLA, Financial), Rivian Automotive (RIVN, Financial), and Nio (NIO, Financial) to Neutral from Buy, citing concerns over demand and liquidity in the electric vehicle sector. The firm remains optimistic about the long-term EV market, with Tesla still seen as the global leader. This adjustment reflects broader industry challenges, including consumer affordability and competition in China.
Super Micro Computer (SMCI, Financial) received an Overweight rating from J.P. Morgan, spotlighting its prominence in the AI server market. Despite a slight premarket decline, Super Micro is positioned as a key player in supporting the burgeoning demand for AI model training and processing, promising robust growth prospects despite valuation concerns.
Ingersoll Rand (IR, Financial) has announced a significant acquisition of ILC Dover for $2.325 billion, aiming to bolster its life sciences segment. This strategic move will introduce new technologies and solutions to Ingersoll Rand's portfolio, enhancing its offerings in the biopharma and medical devices sectors.
Canoo (GOEV, Financial) has completed the acquisition of advanced manufacturing assets from Arrival Automotive UK Limited, marking a significant step in its production strategy. This move is expected to expedite Canoo's transition to automated processes, reducing costs and lead times for its 2024 production goals.
Apple (AAPL, Financial) is set to launch its mixed-reality headset, Vision Pro, in mainland China, according to CEO Tim Cook. This expansion underscores Apple's commitment to R&D investment in China and anticipates the device's potential success in the Chinese market.
Foot Locker (FL, Financial) has been upgraded to Outperform by Evercore ISI, following positive channel checks and potential upside from strategic investments. The retailer is expected to see improved sales in the second half of the year, benefiting from a clearer inventory position and renewed demand.
Match Group (MTCH, Financial) has welcomed two new board members after discussions with Elliott Management. The additions of Laura Jones and Spencer Rascoff aim to bolster the company's marketing and growth strategies, reinforcing Match Group's position in the online dating market.
