Markets News, January 22, 2025: S&P 500 Closes Near Record High as AI Stocks Spur Tech Rally; Netflix Soars on Strong Earnings

Biggest S&P 500 Movers on Wednesday

12 hr 25 min ago

Advancers

• Video streaming giant Netflix (NFLX) posted better-than-expected sales and profits for the fourth quarter, and its shares soared 9.7%, notching the top performance in the S&P 500 on Wednesday. Netflix also reported it had added 19 million new subscribers during the period, boosted its share repurchase program by $15 billion, and increased its 2025 revenue outlook. Analysts at JPMorgan said they expect minimal resistance to subscription price hikes announced by Netflix, pointing to the strong slate of programming on the platform this year.

• Shares of power management chipmaker Monolithic Power Systems (MPWR) jumped 8.0% on Wednesday, adding to a string of gains dating back to last week. The upturn has coincided with several research firms listing Monolithic Power stock among their “top picks.” Analysts at Deutsche Bank pointed to expectations for revenue growth and margin expansion for Monolithic over the coming years, while Oppenheimer analysts noted that the semiconductor industry’s transition toward higher-power modules could help underpin the company’s long-term growth.
• Moderna (MRNA) shares surged 7.3%, posting big gains for the second straight day. The biotech firm received nearly $600 million in additional funding from the U.S. Department of Health and Human Services to advance its development of mRNA vaccines against strains of influenza with the potential to cause a pandemic, including the avian influenza strain H5N1. An additional boost for Moderna came as Larry Ellison, chairman of Oracle (ORCL), spoke at a White House meeting about the potential of artificial intelligence (AI) in developing cancer vaccines.
• Shares of Seagate Technology Holdings (STX) added 6.8% following a strong earnings report. The world’s largest manufacturer of hard-disk drives topped quarterly sales and profit estimates, pointing to an improving demand environment. Analysts at Morgan Stanley affirmed the upbeat trends in the hard-disk drive sector, including Seagate stock among their top picks and indicating that consensus forecasts could be underestimating the company’s gross margin trajectory.

Decliners

• Shares of Edison International (EIX)—operator of Southern California Edison, the largest utility in the region suffering from a torrent of devastating wildfires—sank 6.3%, dropping the most of any S&P 500 stock. On Tuesday, a judge ordered Edison to preserve evidence and data related to the origins of the Eaton fire. Several homeowners in the area have filed lawsuits claiming that the company’s equipment may have played a role in igniting the fire. Previous wildfires in the state have been linked to electrical equipment and triggered significant liabilities for utility companies.
• First Solar (FSLR) shares fell 6.3% on Wednesday, extending losses posted in the previous session after President Donald Trump returned to office and announced the elimination of several renewable energy initiatives. While shares of the solar panel maker have been volatile in recent months, the stock is down around 20% since Trump’s election victory in November.
• President Trump’s initial slate of executive orders included a measure to pause permitting processes for wind energy projects, pending a review by the Department of the Interior. The policy shift weighed on shares of companies with exposure to onshore and offshore wind power generation. Shares of both AES Corp. (AES) and Dominion Energy (D) dropped 5.3%.

–Michael Bromberg

GE Vernova Hits Record High as Company Affirms Outlook

12 hr 50 min ago

GE Vernova (GEV) shares touched a new all-time high Wednesday even though the energy company reported worse-than-expected fourth-quarter results.

The company reported net income of $484 million, or $1.73 per share, on revenue of $10.56 billion. Analysts polled by Visible Alpha expected a profit of $634.5 million, or $2.30 per share, on revenue of $10.74 billion.

GE Vernova’s wind segment reported earnings before interest, taxes, depreciation and amortization (EBITDA) of just $19 million, with the segment losing $588 million on the year. It previously said the unit should be “approaching profitability” by the end of the fiscal year.

The company affirmed its outlook for 2025, expecting revenue between $36 billion and $37 billion, including organic growth in its power and electrification segments and a decline in the wind division.

Last week, Bank of America analysts upgraded and lifted their price target for GE Vernova’s stock, citing optimism that the company could benefit from rising prices for gas turbines.

GE Vernova shares closed 2.7% higher on Wednesday and have more than tripled since the firm spun off from GE Aerospace (GE) last April.

–Aaron McDade

Jamie Dimon Says Stocks are ‘Kind of Inflated’

13 hr 32 min ago

JPMorgan Chase CEO Jamie Dimon on Wednesday said the U.S. stock market is overvalued and explained why he’s a little more pessimistic about the global economy than your average Wall Street insider.

“Asset prices are kind of inflated,” Dimon told CNBC’s Andrew Ross Sorkin in an interview at the World Economic Forum in Davos, Switzerland. (“I’m talking about the U.S. stock market,” he added, “it’s not true for stock markets around the world.”)

U.S. stocks were some of the world’s top performers last year after soaring the prior year as well. The outperformance has been driven by years of a strong U.S. economy, underpinned by a resilient labor market and consumer spending, in the face of elevated interest rates.

Wall Street generally expects the U.S. to continue to outperform this year, thanks in part to the animal spirits expected to be unleashed by President Donald Trump’s deregulation and tax-cutting plans. Dimon, asked Wednesday why he’s “cautiously pessimistic” rather than “cautiously optimistic” about the economic outlook, pointed to elevated asset values.

“You need really good outcomes to justify those prices,” he said. “Having pro-growth strategies helps make that happen, but there are negatives out there and they can tend to surprise you.”

Read the full article here.

–Colin Laidley

Travelers Stock Rises on Better-Than-Expected Earnings

14 hr 44 min ago

Shares in The Travelers Companies (TRV) rose Wednesday, as increased premiums drove higher-than-estimated quarterly results at the property and casualty insurer.

Travelers reported fourth-quarter earnings per share of $8.96, well above the $6.67 average estimate of analysts surveyed by Visible Alpha. Revenue increased 10% to $12.0 billion, also more than estimated.

Core income, which excludes investment gains or losses and discontinued operations, among other things, jumped to a record $2.1 billion during the quarter, Chief Executive Officer Alan Schnitzer said, “driven by strong growth in earned premiums and excellent profitability.”

Net written premiums rose across the segments of business insurance, bond & specialty insurance and personal insurance and grew 7% in the fourth quarter year-over-year. The combined ratio—a measure of profitability used by an insurance company to gauge how well it is performing in its daily operations—rose to 83.2%, a gain of 2.6% percentage points.

Travelers shares were up 3% late Wednesday afternoon and have risen around 15% in the past year, lagging the performance of the S&P 500.

–Bill McColl

Oracle Levels to Watch as Stock Surges on AI Optimism

15 hr 33 min ago

Oracle (ORCL) shares soared Wednesday for the second straight session as investors reacted to news that the enterprise software company will form a joint venture with OpenAI and Japan’s SoftBank to build artificial intelligence (AI) infrastructure.

Oracle shares were up nearly 8% at around $186 in afternoon trading Wednesday, adding to yesterday’s 7% gain. The stock has risen nearly 70% over the past year, supported by growing demand for the company’s AI-integrated cloud and database offerings.

After trending downwards within a falling wedge since late November, Oracle shares staged a decisive breakout from the pattern on Tuesday. Impressively, the move occurred on the highest trading volume since early September, setting the stage for follow-through buying.

Meanwhile, the relative strength index (RSI) has moved back above the 50 threshold to signal improving price momentum, but still remains significantly below overbought levels, giving the stock ample room to explore higher prices.

Read the full technical analysis piece here.

–Timothy Smith

Grail Jumps 20% to Lead Nasdaq Gainers

17 hr 24 min ago

Shares of Grail, Inc. (GRAL) were up more than 20% in afternoon trading, leading gainers in the Nasdaq Composite.

There was no obvious news driving the move, as Grail hadn’t issued a press release or SEC filing today. The company, which is developing a number of early detection cancer screening tests, was spun off from Illumina Health (ILMN) following legal battles with regulators and started trading on its own last June.

Last week at an industry conference, the company projected fiscal 2024 revenue of $124 million to $126 million, and said it expects fiscal 2025 U.S. sales of its Galleri blood test rising 20% to 30% year-over-year.

Grail also said that it expects to burn through less than $320 million over fiscal 2025, and said the $767 million cash on hand to end 2024 should give the company runway into 2028.

–Aaron McDade

Procter & Gamble Rises After Sales Exceed Expectations

18 hr 20 min ago

Shares of Procter & Gamble (PG) rose Wednesday morning after the consumer goods giant posted fiscal 2025 second-quarter net sales that topped Wall Street estimates. 

Net sales grew 2% year-over-year to $21.88 billion, beating the analysts’ consensus compiled by Visible Alpha of $21.59 billion. Net income was $4.63 billion, or $1.88 per share, matching expectations. 

P&G’s Baby, Feminine & Family Care segment, which includes Tampax and Pampers, saw sales rise 3%. Sales rose 2% at Fabric & Home Care, featuring Tide and Febreze products, as well as at Health Care, which includes Crest and Pepto Bismol. Grooming, featuring Gillette and Venus razors, saw revenue grow 1%, while Beauty sales, including the Head & Shoulders and Old Spice brands, were flat.

P&G affirmed its fiscal 2025 outlook, forecasting sales growth of 2% to 4% from $84 billion last year and earnings per share (EPS) growth of 10% to 12% from $6.02 in fiscal 2024.3

The company also reiterated its plan to repurchase $6 to $7 billion worth of shares this fiscal year.

P&G shares were up 3% just before noon. The stock has gained nearly 13% over the past 12 months, about half the increase of the S&P 500 over the period.

–Andrew Kessel

Interactive Brokers Hits Record High on Trading Volume Jump

19 hr 6 min ago

Shares of Interactive Brokers Group (IBKR) hit an all-time high Wednesday, a day after the electronic brokerage firm reported better-than-expected results as strong market gains led to higher consumer trading volume.

The firm posted fourth-quarter earnings per share (EPS) of $1.99, with revenue jumping 22% year-over-year to $1.39 billion. Both exceeded analysts’ estimates compiled by Visible Alpha.

Commissions revenue rose 37% to $477 million, with trading volume in stocks soaring 65% and options up 32%. Other fees and services revenue added 47% to $81 million. 

Customer accounts increased 30% to 3.34 million, and customer equity grew 33% to $568.2 billion.

Interactive Brokers Group shares were up 8% recently. They have risen nearly 130% over the past 12 months.

–Bill McColl

J&J Shares Fall as Sales Outlook Disappoints

20 hr 8 min ago

Johnson & Johnson (JNJ) reported fourth-quarter adjusted profits that beat expectations while the company’s sales projections came in lower than anticipated.

The drug and medical device maker reported $22.52 billion in revenue, in line with analyst estimates compiled by Visible Alpha. After accounting for one-time costs like asset amortization and acquisition-related costs, Johnson & Johnson’s adjusted net income came in at $4.94 billion, just above the $4.88 billion analyst consensus.

Sales in the company’s two divisions of pharmaceuticals and medical technology each rose from the same time last year by 4.4% and 6.7%, respectively.

The company said it expects revenue between $89.2 billion and $90 billion this year, along with an adjusted earnings per share range of $10.50 to $10.70. Analysts currently project a larger revenue figure at $91.18 billion, and adjusted EPS of $10.54, per Visible Alpha estimates.

J&J shares were down 3% in recent trading, pushing the decline for the past 12 months to nearly 12%.

–Aaron McDade

Netflix Levels to Watch as Stock Surges After Earnings Report

21 hr 19 min ago

Netflix (NFLX) shares soared after the streaming giant posted better-than-expected fourth-quarter results and lifted its 2025 revenue outlook.

Investors also cheered the streamer’s decision to raise its subscription prices in the U.S., Canada, Portugal, and Argentina. The company added 19 million net new subscribers in the fourth quarter, taking its membership tally to over 300 million.

Through Tuesday’s close, Netflix shares had gained 80% over the past 12 months, significantly outpacing the S&P 500’s 25% return during the same period. The stock was up 15% at $997 in recent premarket trading.

Prior to the company’s earnings report, the stock found buying interest around the 50-day moving average.

Bars pattern analysis forecasts a potential upside target of around $1,285 and indicates that a new trend may play out until late May. Investors should watch major support levels on Netflix’s chart around $930 and $824.

Read the full technical analysis piece here.

–Timothy Smith

Futures Point to Higher Open for Major Indexes

22 hr 5 min ago

Futures tied to the Dow Jones Industrial Average were up 0.3% in recent trading.

S&P 500 futures were up 0.5%.

Nasdaq 100 futures added 0.9%.