Markets News, October 7, 2024: Major Stock Indexes Tumble as Oil Prices and Treasury Yields Rise

Biggest S&P 500 Movers on Monday

5 hr 19 min ago

Decliners

• The prospect of significant damage from Hurricane Milton, which is expected to reach Florida’s Gulf Coast this week, weighed on insurance stocks. Shares of Everest Group (EG), which provides insurance and reinsurance policies, plunged 8.5%, the biggest drop of any S&P 500 stock. Shares of fellow Bermuda-based insurer and reinsurer Arch Capital Group (ACGL) lost 6.2%, while auto, lifestyle, and housing insurer Assurant (AIZ) was down 5.5%.

• Shares of Texas-based power generator Vistra (VST) fell 5.2%. The downturn on Monday marked a reversal from a series of record highs posted by the stock last week amid optimism about the company’s opportunity to provide nuclear-generated electricity to artificial intelligence data centers. Vistra stock remains the S&P 500’s top performer in 2024, up more than 240% on the year.
• Deckers Outdoor (DECK) shares sank 4.8% after Seaport Research downgraded the stock to “neutral” from “buy.” Analysts said interest in the company’s Ugg and Hoka footwear brands had softened during the recent back-to-school shopping season as competing brands took market share.

Advancers

• Shares of server and data storage provider Super Micro Computer (SMCI) skyrocketed 15.8%, notching Monday’s top performance in the S&P 500. Supermicro reported strong deliveries of its graphics processing units, boosted by robust demand for artificial intelligence products. The company also launched new direct liquid cooling products for servers that could help AI companies lower their energy costs.
• Air Products and Chemicals (APD) shares surged 9.5% amid reports that activist investor Mantle Ridge has accumulated a stake worth more than $1 billion in the industrial gas maker. The investment firm reportedly plans to push for a variety of changes at Air Products, including to its capital allocation strategy and succession plan.
• Shares of Generac Holdings (GNRC), a maker home generators and other emergency power products, jumped 8.5% to reach a two-year high as Hurricane Milton approached the Southeastern U.S. The stock saw similar price boosts as the country braced for the impact of Hurricanes Helene and Beryl earlier this season.

–Michael Bromberg

Exxon Prices to Watch as Stock Hits Another Record High

6 hr 34 min ago

Shares in ExxonMobil (XOM) set another record high on Monday as investors bid up energy stocks over mounting concerns that escalating tensions in the Middle East could disrupt global oil supplies. 

Exxon shares rose 0.4% to close Monday at $125.37, after moving as high as $126.34 during the session.

The stock broke out above the top trendline of a symmetrical triangle last week on increasing trading volume.

Investors should watch key upside targets on Exxon’s chart around $134 and $138, while keeping an eye on important support areas near $118 and $112.

Read the full technical analysis piece here.

–Timothy Smith

Generac Jumps to Two-Year High as Hurricane Milton Intensifies

7 hr 31 min ago

Shares of Generac Holdings (GNRC), a producer of home generators and other emergency power products, surged again Monday as another hurricane approaches the Southeast U.S.

Hurricane Milton rapidly progressed to a Category 5 storm Monday and is expected to make landfall in Florida by Wednesday, according to the National Hurricane Center.

Generac stock was up more than 9% late Monday, trading at its highest levels since October 2022. The stock has gained 35% so far in 2024.

The generator maker experienced a similar stock-price bump due to Hurricane Helene a few weeks ago, jumping about 10% the week that storm made landfall.

–Andrew Kessel

Wall Street Scales Back Bets on Big Rate Cuts

8 hr 38 min ago

Investors on Monday continued to scale back their interest rate cut expectations after Friday’s better-than-expected jobs report.

Market participants were even pricing in a small chance that the Fed will leave rates unchanged at its next meeting in November, an outcome that wasn’t thought to be on the table just last week.

Last week’s jobs report could increase the importance of this week’s consumer inflation report in the eyes of both the Federal Reserve and Wall Street.

Read the full story here.

–Colin Laidley

Super Micro Computer Soars on Strong AI Demand

10 hr 5 min ago

Super Micro Computer (SMCI) shares soared Monday as the server maker reported strong shipments of its graphics processing units (GPUs), driven by artificial intelligence (AI) demand.

The company said it recently deployed 100,000 GPUs with its liquid cooling technology to “some of the largest AI factories ever built.” Super Micro Computer also announced a new lineup of direct liquid cooling products for servers that it said could help AI firms cut their energy costs. 

CEO Charles Liang said the company’s liquid cooling solutions “are now cooling massive, state-of-the-art AI factories, reducing costs and improving performance.” Liang added that data center operators are coming to Super Micro Computer “to meet their technical and financial goals for both the construction of greenfield sites and the modernization of existing data centers.”

Super Micro Computer shares were up nearly 15% in recent trading and have gained about 67% in 2024. Shares of AI chipmaker Nvidia (NVDA), a partner of Super Micro Computer, also got a boost Monday, rising more than 3%.

–Bill McColl

Duckhorn Doubles on PE Takeover News

11 hr 7 min ago

Shares of The Duckhorn Portfolio (NAPA) doubled Monday after the Napa Valley winemaker agreed to be taken private by private-equity firm Butterfly for $1.95 billion. 

Duckhorn, whose brands include Decoy and Paraduxx, said the agreement gives investors $11.10 in cash for each share they own, which represents a 106% increase from its closing price on Friday.

The company also reported fourth-quarter adjusted earnings per share (EPS) of $0.14, with revenue up 7.3% year-over-year to $107.4 million. Both topped consensus estimates of analysts polled by Visible Alpha. 

The Duckhorn Portfolio shares hit an all-time low on Friday, and with today’s huge gains they’ve moved into positive territory for the year.

–Bill McColl

Pfizer Rises on Report of Starboard Stake

12 hr 13 min ago

Shares of Pfizer (PFE) rose Monday following a report that activist investor Starboard Value has taken a roughly $1 billion stake in the struggling drugmaker.

According to The Wall Street Journal, Starboard has approached Ian Read, a former Pfizer chief executive, and ex-finance chief Frank D’Amelio to aid its plans to improve the company’s performance.

The hedge fund sees Pfizer under current CEO Albert Bourla, who took over from Read in 2019, as lacking the M&A discipline of his predecessor, the report said.

Pfizer has spent billions of dollars on buying companies involved in producing cancer drugs, including biotech Seagen for $43 billion last year, since Bourla took over.

Shares of the company were up nearly 3% Monday morning and were among the big gainers in the S&P 500.

Pfizer’s shares have almost halved since their pandemic peak in 2021 as demand for its COVID-19 vaccines slumped. They are little changed this year, versus a 21% jump in the S&P 500.

–Nisha Gopalan

Jefferies Downgrades Apple to Hold

12 hr 31 min ago

Apple (AAPL) shares lost ground in early trading Monday after Jefferies downgraded the stock, arguing that the anticipated sales of iPhones are too high.

The bank cut Apple’s rating to “hold” from “buy,” although it raised its price target to $212.92 from $205.00.

The analysts wrote in a note to clients that “smartphone hardware needs rework before being capable of serious AI, with likely timeline of 2026/27.”

They added that “high expectations for iPhone 16/17 are premature.”

The analysts pointed out that their outlook for Apple’s fiscal 2024 fourth-quarter net sales is less than the Wall Street consensus, and that the tech firm’s 33 times full-year estimated adjusted price-to-earnings (P/E) ratio is near an all-time high. 

Apple shares were down 0.6% in recent trading. The stock has gained 17% in 2024.

–Bill McColl

SPDR Dow ETF Levels to Watch

13 hr 29 min ago

The SPDR Dow Jones Industrial Average ETF Trust (DIA) opened slightly lower Monday, in line with the Dow’s decline, after posting a record close Friday following a strong September jobs report that reinforced investor confidence in the strength of the economy.

The fund’s price trades within an ascending channel, though lackluster volumes potentially indicate waning upward momentum.

Investors should monitor crucial support levels on the ETF’s chart around $377, $350, and $325, while also watching a measured move price target above the ascending channel at $483.

Read the full technical analysis piece here.

–Timothy Smith

Major Indexes Poised to Open Lower Monday

14 hr 46 min ago

Futures tied to the Dow Jones Industrial Average were down 0.4%.

S&P 500 futures were also down 0.4%.

Nasdaq 100 futures were down 0.5%.

CORRECTION—Oct. 7, 2024: This article has been corrected to reflect Super Micro Computer reported it deployed 100,000 graphics processing units (GPUs).