US stocks finished little changed Friday, with the S&P 500 and Nasdaq logging strong weekly performances as Apple's (AAPL) AI strategy and Elon Musk's pay package win at Tesla (TSLA) took center stage.
The Dow Jones Industrial Average (^DJI) lost about 0.2%, while the S&P 500 (^GSPC) tipped just below the flatline. The tech-heavy Nasdaq Composite (^IXIC) gained 0.1% to eke out its fifth consecutive record close.
The S&P 500 finished up around 1.5% this week, while the Nasdaq gained more than 3%. The S&P notched record closes for four days in a row, while the Nasdaq pulled off the improbable five straight, boosted by strength in techs.
But the Fed this week dialed down its projected rate cuts from three to one in 2024, keeping the market guessing and leaving stocks vulnerable to shifts in mood. Strength in technology names has driven broader gains, earning the S&P 500 and the Nasdaq multiple record closes for the week. But the Dow suffered a loss for the week, as questions persist about the breadth of this year's rally.
Meanwhile, Tesla shares were down 2% Friday after shareholders reapproved CEO Elon Musk's pay package. Despite opposition from some large investors, 77% of votes were cast in favor, the EV maker said.
Weighing down spirits Friday more generally was a slump in European stocks (^STOXX). Investors are concerned about the fallout for markets if the far right makes political gains or even wins France's snap election, whose first round will begin at the end of the month.
In other individual movers, Adobe (ADBE) shares jumped close to 15% after an upbeat AI sales projection from the Photoshop maker.
LIVE COVERAGE IS OVER11 updates
Hamza Shaban
Nasdaq ekes out a gain to end week full of records
Stocks cooled off some to end the trading day on Friday, but investors still won out on the week, which featured a more optimistic inflation outlook from the Fed, the debut of Apple's AI plans, and a major shareholder victory for Tesla's Elon Musk.
The Dow Jones Industrial Average (^DJI) lost about 0.2%, while the S&P 500 (^GSPC) tipped just below the flatline. The tech-heavy Nasdaq Composite (^IXIC) gained 0.1%.
Hamza Shaban
A look at the week ahead
Investors are in for a relative lull next week, coming off major developments from Apple (AAPL), Tesla (TSLA), and the Federal Reserve.
Earnings season too is winding down, although Accenture (ACN), Kroger (KR), and CarMax (KMX) are among the tickers set to report next week.
Investors will be greeted with a shortened schedule as markets will be closed on Wednesday in honor of the Juneteenth holiday. But a smattering of economic indicators will give the market some metrics to chew on as the broader story over inflation and interest rates continues to play out with sudden shifts in sentiment.
Retail sales and industrial production figures will arrive on Tuesday, followed by S&P flash US PMI on Friday, offering insight into business conditions as central bankers and market participants look for signs of economic weakness.
Wall Street will also brace for further concerns from Europe, where markets have been rattled by the prospect of political advances of the far-right party in France. President Emmanuel Macron called for snap elections that will begin later this month after his party was beaten badly by the far right in European Parliament elections.
Yahoo Finance's Brent Sanchez has a graphical breakdown of what to watch next week:
That’s because the sometimes-gadget rivals work as partners when it comes to search and online advertising. But the tie-up, which has featured heavily in a landmark antitrust lawsuit against Google’s dominance in the search engine market, will come under new strain as AI changes how people seek out information online.
For more than two decades, Apple has fixed Google as the default search engine in its Safari browser. Apple steers the traffic of its huge user base into Google’s search business. And in exchange for the default privilege, Google pays the iPhone maker around $18 billion a year.
But Apple, to the delight of investors, has another deal going.
Apple is partnering with OpenAI to bring ChatGPT to the iPhone. It’s part of a bold effort to catch up to Big Tech rivals that have gone all-in on AI. Later this year, iPhone users will get free access to the chatbot, which will mesh with Siri and other apps, giving people access to a repository of knowledge and granting OpenAI a ticket to mainstreaming AI technology.
Apple's iPhones infused with increasingly capable versions of ChatGPT would lessen the need to use Google search. If users in significant numbers start interacting with the web primarily through Siri instead of a search bar, even the heavy influence of default status might mean very little for the future of search traffic.
If chatbots and other software powered by large language models (LLMs) are as transformational as tech executives claim they are, the business of search is poised for major disruption.
Hamza Shaban
Price pessimism continues despite positive inflation data
The disconnect between positive inflation data and negative public sentiment continues to reveal itself, based on a new reading of consumer perceptions.
The latest University of Michigan consumer sentiment survey released Friday showed sentiment hit its lowest level in seven months during June. The index reading for the month came in at 65.6, down from 69.1 in May and lower than the 72 economists had expected.
Broadly speaking, the decline in the index represents a continued trend among consumers who are fed up with higher prices regardless of whether inflation is cooling and the labor market remains on solid footing, reports Yahoo Finance's Josh Schafer.
Experts have argued that the incongruence stems in part from how people perceive their own financial circumstances versus how they see the health of the national economy.
The degree of negativity that isn’t always connected to a person's own circumstances reflects the disorienting period of the pandemic and its aftermath, market observers have argued. And the rapid changes that followed — high inflation and high interest rates — could have amplified those negative perceptions.
Hamza Shaban
Stocks trending in afternoon trading
Here are some of the stocks leading Yahoo Finance’s trending tickers page during afternoon trading on Friday.
RH (RH): The home furnishings company shed 17% Friday afternoon after missing earnings expectations and forecasting second quarter guidance that fell below estimates. RH reported a wider-than-expected first quarter loss amid softening demand in the housing market.
Royal Caribbean (RCL): The cruise line and its peers tumbled Friday after Wall Street expressed concerns of some industry weakening. “Based on cruise prices pulled in early June, there was modestly softer pricing in ocean markets relative to early May,” said Bank of America analysts in a research note Friday. Royal Caribbean gave up more than 5%.
Adobe (ADBE): Shares of the software company surged close to 15% after reporting fiscal second quarter earnings that beat expectations and boosted guidance for the year. A rosier outlook for sales of its creative products suggests increasing adoption of the company’s new AI tools.
Shopify (SHOP): Shares of the e-commerce company gained 5% following an analyst upgrade that implied a 16% increase in the stock price. Evercore ISI analyst Mark Mahaney upgraded Shopify from In-Line to Outperform after the stock's pullback created an entry point for investors.
Hamza Shaban
Stocks tick down in afternoon trading
US stocks pulled back on Friday just as a new reading of consumer sentiment tumbled in June, as higher prices remained a pain point for Americans.
The Dow Jones Industrial Average (^DJI) sank about 0.3% to lead the declines, while the S&P 500 (^GSPC) shed 0.2%. The tech-heavy Nasdaq Composite (^IXIC) dropped about 0.1%.
Hamza Shaban
Trump offers a low-tax pitch to business leaders
The Trump campaign engaged in fresh outreach to the business world that crystallized his promises to corporate America should he win the election.
Donald Trump met with prominent CEOs in the nation's capital, speaking to a group supremely focused on tax reform, reports Yahoo Finance's Ben Werschkul.
The former president was interviewed on stage by Larry Kudlow, his former top economic adviser, and appeared before an audience that included figures like Jamie Dimon of JPMorgan Chase (JPM), Tim Cook of Apple (AAPL), Bechtel CEO Brendan Bechtel, and Walmart (WMT) CEO Doug McMillon and dozens more top executives.
According to one CEO who was in attendance, Trump was focused on favorably comparing his own record on issues like taxes, regulation, and inflation to Biden's time in office. Trump also offered attacks on Biden, but the CEO was skeptical that the back-and-forth moved the needle on business leaders' overall views.
The plan Trump has outlined centers on an extension of his 2017 tax cuts, which cut costs for many individuals and businesses. He is promising to extend those cuts and also potentially make new ones, including an idea to further lower the corporate tax rate.
Hamza Shaban
Musk doubles down on Tesla growth after successful shareholder vote
Tesla CEO Elon Musk, fresh off a major win in which shareholder's reapproved his record-breaking pay package, is doubling down on the company's enormous potential for growth.
After Tesla confirmed that 72% of votes cast by shareholders were in favor of a $56 billion compensation package, Musk reiterated his vision for Tesla that goes beyond cars.
Musk predicts that Tesla's humanoid robot prototype, called Optimus, will surpass the size of the company's vehicles business.
“If the price-to-earnings multiple is, say, I don’t know, 20 or 25, something like that, that would mean a $20 trillion market cap from Optimus alone,” Musk said at the company's annual shareholder meeting.
But Musk's optimism for the future of Tesla faces multiple hurdles. For one, even after the majority of voting shareholders backed his pay package, other stakeholders could challenge its legality before the same Delaware court that voided Musk’s pay earlier this year.
In addition, Musk has previously threatened to develop AI technology outside of Tesla if he is not given sufficient voting control over company decisions.
Hamza Shaban
Stocks trending in morning trading
Here are some of the stocks leading Yahoo Finance’s trending tickers page during morning trading on Friday.
Adobe (ADBE): Shares of the software company surged 15% after reporting fiscal second quarter earnings that beat expectations and boosted guidance for the year. A rosier outlook for sales of its creative products suggests increasing adoption of the company’s new AI tools.
GameStop (GME): The meme stock rose almost 3% Friday morning, riding the momentum from the earlier session after Keith Gill, the folk-hero retail trader, shared a screenshot of an account that showed a massive increase in his GameStop position. The image appeared to show more than 9 million GameStop shares, up from Monday's 5 million shares from a similar screenshot that the account posted on Reddit.
Shopify (SHOP): Shares of the e-commerce company gained 3% following an analyst upgrade that implied a 16% increase in the stock price. Evercore ISI analyst Mark Mahaney upgraded Shopify from In-Line to Outperform after the stock's pullback created an entry point for investors.
Zscaler (ZS): The cloud security company increased nearly 2% following an upgrade from JPMorgan. Analysts said Zscaler is a "next generation" security company that is poised for growth, which is currently trading at a discount. JPMorgan upgraded the stock from Neutral to Overweight.
Dani Romero
RH stock plunges after retailer posts wider-than-expected loss
RH (RH) stock sank more than 17% Friday morning after the luxury home goods retailer reported a wider-than-expected loss the previous day and said it expected business conditions to remain challenging until interest rates ease and the housing market rebounds.
RH posted a loss of $0.40 per share, wider than analyst estimates for a loss of $0.09.
“I don't think there's going to be a sustained inflection in luxury home sales at these interest rates,” RH chairman and CEO Gary Friedman told investors and analysts on the company's earnings call on Thursday, noting that mortgage rates may not meaningfully move downward until next year.
"Home prices went up 42% in the two years of COVID, and then they've continued to compound the last two years. ... And now you've got interest rates 7% or higher when they were 2.6% to 3.3%. I mean it's just simple affordability now,” the executive added.
The comments come after the Federal Reserve held interest rates steady this week and signaled it expects just one interest rate cut this year, down from three previously. The Fed doesn’t directly set mortgage rates, but its policy moves impact them.
US stocks pulled back from all-time highs as investors reacted to jitters in Europe, where the coming snap election in France could bring advancements for the nation's far-right party.
The Dow Jones Industrial Average (^DJI) sank about 0.5%, while the S&P 500 (^GSPC) shed 0.3%. The tech-heavy Nasdaq Composite (^IXIC) dropped 0.2%.
A husband and wife duo who built an outdoor theatre on the grounds of their Suffolk farm estate have been catapulted into Britain’s rich list after netting £2bn from the sale of their financial data business.
A mum-of-five with a £62k household income has resorted to using Klarna to afford her food shop - due to the cost-of-living crisis. Laura Caine, 40, struggles to cover her family's monthly outgoings using her £1k-a-month universal credit payment and her husband Martin's £50k games programmer salary. The couple have five children - aged 18 to nine - and say feeding the brood three meals a day gets expensive so they have had to use the buy-now-pay-later service. In recent months Laura says she had to use Klarna to afford groceries as she "can't afford" to pay for a big shop upfront. Laura claims both she and Martin have both maxed out their credit cards after their energy bill shot up to £450-a-month from £200.
This FTSE 100 insurance and investment firm has one of the highest yields in the index, looks set for stellar growth, and appears undervalued to me. The post A 9.9% dividend yield! Is this hidden FTSE passive income gem too good to miss? appeared first on The Motley Fool UK.
The UK general election is in focus this week as investors brace for a widely expected Labour landslide that could share price moves across the FTSE 100.
Households who receive six legacy benefits set to be replaced by Universal Credit have been issued a warning as they risk having their benefits stopped
Some dividend shares offer the potential for regular returns, with a good record and bright future prospects. The post 2 boring yet consistent dividend shares investors should consider buying in July appeared first on The Motley Fool UK.
As Conservative grandees fret about a Labour “forever government” after this week’s election, Britain’s most affluent savers and investors are busy making the most of tax reliefs while they still can.
The BAE Systems share price has pulled back by 8% over the past month. Our writer considers whether this may be the start of a bigger trend. The post Could the BAE Systems share price be about to collapse? appeared first on The Motley Fool UK.
The UK stock market is brimming with promising long-term investment opportunities. But I wouldn’t say that these two shares are the ones. The post 2 shares I’d give a wide berth to in today’s stock market appeared first on The Motley Fool UK.
Investing in dividend stocks via a Stocks and Shares ISA is a great way to build a second income stream, according to this Fool. Here’s one stock to consider. The post I’d aim for a second income of £1,200 a month with this high-yield dividend stock appeared first on The Motley Fool UK.
Millions of us invest for dividends. Here, our writer highlights three passive income shares that deliver index-topping returns for investors. The post These 3 passive income shares could generate a ton of dividends appeared first on The Motley Fool UK.
Ocado shares have taken a huge hit over the last three-and-a-half years, losing around 90% of their value. Should Edward Sheldon buy them now? The post Should I buy Ocado shares after a 90% drop? appeared first on The Motley Fool UK.
We recently compiled a list of the 11 Wealthiest People in Ireland and in this article, we will look at the richest person in Ireland. Ireland’s Global Positioning Ireland is the second richest country in the world boasting a GDP per capita of $143,179 and a wealth per adult of $247,080. The country has demonstrated […]
This Fool wants to add more to his Stocks and Shares ISA and he has his eye on these Footsie heavyweights. Here, he breaks down why. The post 2 FTSE 100 stalwarts I’d love to add to my Stocks and Shares ISA appeared first on The Motley Fool UK.
STORY: Airbus delivered more jets over the first half of the year, but it's battling mounting headwinds. Industry sources estimate the aerospace giant handed over about 323 new aircraft. That would be up about 2% on last year, with official figures expected next week. But the sources estimate deliveries fell short of targets in June. That would tally with a warning from Airbus last week that it was cutting its goals for the year. It now aims to deliver 770 jets, instead of the 800 initially planned. The firm cited a shortage of engines, structural parts and interiors. As a result it put back plans to raise output of its best-selling A320neo family of jets. It still expects to hit a record rate of 75 per month, but not until 2027 - a year later than expected. Right now it makes 50 per month. There was no comment on the latest reports from Airbus. But some analysts are already cutting their forecasts for its output next year.
The FTSE 100's up 442 points this year, but bargains remain. Mark Hartley reveals one of his favourite value stocks this month. The post Are FTSE 100 shares STILL cheap? I think so, and here’s one to consider buying in July appeared first on The Motley Fool UK.
A diversified portfolio of UK blue-chip shares and ETFs could be a great way to build long-term wealth, argues our Foolish writer Royston Wild. The post £20k to invest? A FTSE 100 share and an ETF to consider in July! appeared first on The Motley Fool UK.