Markets News, July 1, 2024: US stocks start third quarter with gains

S&P 500 Gainers and Decliners

action 1 hour 27 minutes

wINNERS

Tesla Shares ( TSLA ) rose 6.1%, the best performance of any S&P 500 component in the first trading day of the third quarter. The strong day for Tesla came on the heels of another electric vehicle (EV) maker. Nothing (NIO) reported an all-time high for vehicle shipments in June. China-based Nio’s American depositary receipts (ADRs) rose 6.7% on Monday. Tesla is set to report its delivery figures on Tuesday.

Merck Shares ( MRK ) rose 3.3% after the pharmaceutical giant announced it will acquire exclusive rights to develop and commercialize opevesostat, a compound being investigated for the treatment of certain types of prostate cancer.

Shares of Apple ( AAPL ) gained 2.9% amid reports that the tech giant may raise prices for its high-end iPhones as a way to keep lower-end models more attractively priced. According to Needham analysts, the strategy could help Apple expand its user base without jeopardizing its relationships with high-end customers, who tend to be less price-sensitive. The possible price adjustments come amid reports that Apple has seen declines in its share of the smartphone markets in the US and China.

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Shares in cruise operators sank amid concerns that Hurricane Beryl, which has strengthened to a Category 4 storm, could disrupt travel to the Caribbean. Norwegian Cruise Line Holdings Shares of ( NCLH ) fell 5.9%, suffering the worst losses in the S&P 500. Carnival Corp. Shares (CCL) weren’t far behind, losing 5.4%. Warm ocean temperatures have meteorologists predicting an active hurricane season this year.

Elsewhere in leisure stocks, casino shares fell. The declines in the gambling industry came as gross gambling revenue from Asian gaming hotspot Macau came in below consensus estimates in June to touch lows in 2024. Shares of Caesars Entertainment (CZR) fell 5%, while MGM Resorts Shares of (MGM) lost 3.6%.

Shares of Warner Bros. DISCLOSURE ( WBD ) fell 4.6% after reports the entertainment giant could consider a merger between its popular Max service and streaming platform Paramount+ owned by Paramount Global (EVEN). Paramount Global fell 2.4%.

–Michael Bromberg

Tesla shares jump ahead of delivery numbers

Action 3 hours 24 minutes

Shares of Tesla ( TSLA ) gained on Monday, lifted by optimism that the electric vehicle (EV) maker will post solid second-quarter delivery numbers tomorrow.

Chinese demand is “slowly coming back” and a “mini rebound” occurred there for the company in the second quarter, according to Wedbush Securities analysts led by bull Dan Ives.

The current Visible Alpha consensus is for just under 439,000 shipments; the company reported about 387,000 for the first quarter.

Tesla shares were up more than 6% in late trading, but were still down 15% so far in 2024.

–Bill McCall

GameStop Stock Slides

Action 4 hours 30 minutes

Shares of GameStop ( GME ) fell more than 4% in intraday trading Monday as investors reacted to news about Keith Gill, the investor known as “Roaring Kitty” who was one of the main drivers of the stock meme craze in end of 2020 and early. 2021.

Gill is facing a potential class action lawsuit, filed late last week, over alleged manipulation of GameStop’s stock price. Investors may also think Gill has walked away from the toy retailer after news of his 6.6% stake in online pet store Chewy ( CHWY ).

–Bill McCall

Trump media rises as stock pair indexes or Russell rally

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Shares of Trump Media & Technology Group ( DJT ) rose in intraday trading Monday after the Truth Social platform owner was added to the Russell 3000 and Russell 1000 indexes as part of their annual adjustments.

The former president’s media company will be part of the indexes until the next annual rebalancing that will take place in June. This year’s adjustments were finalized after markets closed on Friday and went into effect Monday morning, with dozens of other companies also joining the indexes along with Trump Media.

The Russell 3000 tracks the largest publicly traded companies by market capitalization and is the basis for the smaller Russell 2000 and Russell 1000 indexes, which track the bottom two-thirds and top third of the larger index, respectively.

Shares of Trump Media have experienced significant volatility since the company merged with Digital World Acquisition Corp. and became a public company in March.

Electric vehicle makers get boost from Nio’s record deliveries

Action 7 hours 30 minutes

Shares of Nio ( NIO ) rose on Monday after the Chinese electric vehicle maker reported a second consecutive month of record shipments. The news lifted shares of rival EV makers.

Nio said it delivered 21,209 vehicles in June, almost double the number from last June and a record high.

Nio’s US-listed American Depository shares recently rose more than 5%. Those of Li Auto ( LI ) and XPeng ( XPEV ) also advanced as those EV firms also announced shipments.

Shares of Tesla ( TSLA ) and Rivian Automotive ( RIVN ) were also higher. Rivian secured a multi-billion dollar investment from Volkswagen last week.

-Bill McColl

Key S&P 500 Levels to Watch

Action 8 hours 40 minutes

The large-cap S&P 500 added 3.9% in the second quarter, boosted by artificial intelligence (AI)-themed stocks, from chipmakers that develop sophisticated processors that power the technology to utility companies that provide electricity to power centers. power-hungry data that houses AI infrastructure.

These are the key chart levels worth paying attention to in the coming quarter.

The index broke to a new record in mid-May and traded in a narrow channel for several weeks before continuing to cut higher through most of June.

Recently. some technical indicators point to a slowdown in the growing momentum. First, a choking sliding pattern appeared on the chart on Friday. This price formation indicates a change in psychology among market participants and warns of a possible reversal. Also, while the S&P 500 hit a higher level last week, the relative strength index (RSI) made a lower level to create a technical divergence between price and the indicator, also suggesting a weakening of long-term buying pressure.

The first level to monitor lies at 5,340, an area on the chart that could find support from a horizontal line connecting a series of price action between May and June. A move below this level could see the index revisit the key 5,250 region, where it is likely to encounter buying interest near the 50-day moving average, which closely aligns with a horizontal trendline that has turned from offering resistance to offering of support. Finally, a more significant reversal could see a test of the apparent mid-April swing at 4,954.

-Timothy Smith

Pre-market trading moves

action 10 hours 22 minutes

Earnings:

• Chewy (CHWY): The online pet retailer is up 12% after Keith Gill, also known as “Roaring Kitty,” disclosed an ownership stake of about 6.5% of Chewy stock in an SEC filing. Gill’s posts on X, formerly Twitter, led followers to believe he had invested in Chewy or another pet-related company like Petco (WOOF).
• Spirit AeroSystems ( SPR ): Shares of the aerospace parts maker rose 4.5% after Boeing ( BA ) announced that a deal has been finalized to take over the company.
• Li Auto ( LI ): The Chinese electric vehicle maker rose 3% as it was one of a number of EV makers to report June delivery and production numbers on Monday morning.

Losses:

• GameStop ( GME ): Shares of the video game retailer sank more than 7% as markets reacted to Gill’s disclosure about his Chewy stock. Other meme stocks like AMC Entertainment ( AMC ) and Tupperware ( TUP ) also traded lower.
• Micron Technology ( MU ): Micron fell 0.8%, continuing a downward trend that has continued since its disappointing earnings report last week hurt its stock along with others in the tech world such as Nvidia ( NVDA ).

Stock futures are higher to start the third quarter

action 10 hours 42 minutes

Futures tied to the Dow Jones Industrial Average rose 0.2%.

S&P 500 futures rose 0.3%.

Nasdaq 100 futures also gained 0.3%.