Update—July 2, 2024: For today's live markets news, see here.
Stocks gave up early gains to close in the red Friday despite the Federal Reserve’s preferred inflation measure showing price pressures eased in May.
The Nasdaq Composite slid 0.7% to finish the week 0.2% higher. The S&P 500 fell 0.4% Friday to end 0.1% lower for the week. The Dow Jones Industrial Average slipped 0.1% to finish the week little changed. The Dow was the only index to lose ground in the second quarter. It fell about 2% while the S&P 500 and Nasdaq rose 4% and 8%, respectively.
The Personal Consumption Expenditures (PCE) price index was unchanged in May after ticking up 0.3% in April. Core inflation, which excludes food and energy prices, was 0.1% in May, bringing the annual rate down to 2.6%, its lowest reading since March 2021.The data reinforced Wall Street’s expectations for at least one interest rate cut later this year.
Nike (NKE) shares sank Friday morning after the apparel giant reported disappointing earnings after the bell Thursday. The weak earnings also pushed competitors like Under Armour (UA) and Lululemon (LULU) lower.
Shares of Trump Media (DJT) gave up early gains as investors reacted to the first presidential debate of the 2024 election between former President Donald Trump and President Joe Biden.
Treasury yields swung higher after falling on Friday's inflation data, while the dollar, oil, and major cryptocurrencies retreated.
Stocks were higher Thursday despite a volatile day of trading, with the Nasdaq Composite rising 0.3% and the S&P 500 and Dow Jones Industrial Average each up about 0.1%. Popular artificial intelligence stocks like Nvidia (NVDA) were down as markets reacted to lackluster earnings from Micron (MU).
Infinera Soars After $2.3 Billion Deal to Be Acquired by Nokia
June 28, 2024 04:05 PM EDT
Shares of Infinera (INFN) soared in premarket trading Friday, a day after the optical networking solutions company agreed to be acquired by Finnish telecommunications firm Nokia (NOK) for $2.3 billion.
The deal values California-based Infinera at $6.65 per share, and will be paid at least 70% in cash, with shareholders also able to receive up to 30% of the deal's value in American depositary shares (ADSs) of Nokia, the companies said Thursday.
Infinera manufactures a number of networking-related products like optical semiconductors, meaning the acquisition can give Nokia larger exposure to the artificial intelligence (AI) data center market that has seen increased demand in the last year.
The deal is set to close in the first half of next year assuming it's approved by Infinera shareholders and U.S. regulators, and Nokia said it expects to see an estimated 200 million euros ($214 million) in "net comparable operating profit synergies by 2027."
Infinera shares soared about 17% to trade at $6.16 late in the session Friday. American depositary receipts (ADRs) of Nokia were up about 1%.
-Aaron McDade
Rocket Pharmaceuticals Falls as FDA Delays Approval of Gene Therapy Treatment
June 28, 2024 02:08 PM EDT
Rocket Pharmaceuticals (RCKT) shares declined in intraday trading Friday after the biopharmaceutical firm announced that the Food and Drug Administration (FDA) wants more data about its gene therapy to treat a rare immune disorder in children before granting approval.
The company reported that the FDA sent it a Complete Response Letter (CRL) asking for “limited additional Chemistry Manufacturing and Controls (CMC) information to complete its review” of the drug, called Kresladi.
This is the second time the FDA has delayed a decision on Kresladi, which is designed to treat severe leukocyte adhesion deficiency-I (LAD-I). Rocket had anticipated action by the end of March, but officials extended that by three months, also because of questions about CMC.
Shares of Rocket Pharmaceuticals were down nearly 4% Friday afternoon, and have lost more than 30% of their value year-to-date.
-Bill McColl
Trump Media Stock Seesaws After First Presidential Debate
June 28, 2024 01:11 PM EDT
Trump Media & Technology Group (DJT) shares surged in early trading Friday before turning lower, one day after the first 2024 presidential debate Thursday night.
The parent company of Donald Trump’s social media site Truth Social saw its stock price climb more than 9% ahead of the opening bell Friday, though shares reversed course after the opening bell and were about 6% lower in early afternoon trading.
The stock has experienced significant volatility since it merged with Digital World Acquisition Corp. and became a public company in March.
The swing in Trump Media shares Friday came after a majority of debate viewers polled by CNN, which hosted the debate, said they believed Trump won the debate. About two-thirds of respondents said Trump gave a stronger performance than President Joe Biden.
Other stocks associated with the former president's campaign experienced similar swings. Rumble (RUM), an online video platform popular among conservatives, reported a record number of live-stream viewers during the debate Thursday, and its stock climbed early Friday before dropping about 3% later in the session.
-Andrew Kessel
What Friday's Inflation Report Tells Us About Future Interest Rate Cuts
June 28, 2024 12:00 PM EDT
The Federal Reserve's preferred measure of inflation slowed down in May, buoying hopes of interest rate cuts.
Prices as measured by the Personal Consumption Expenditures (PCE) index, rose by a negligible amount over the month. It was the slowest pace of inflation since November.
"It is just additional news that monetary policy is working—inflation is gradually cooling," said San Francisco Federal Reserve Bank President Mary Daly in an interview on CNBC after the numbers were released.
The new PCE data supports economists' and traders' view that a central bank rate cut is imminent. Traders are still firm in their belief that a rate cut is likely in September, pricing in a 68% chance, according to the CME Group’s FedWatch tool. The chances were up slightly from the week before and up more than 20 percentage points from a month ago.
"Officials will want to see a few more encouraging inflation reports before beginning to cut interest rates, but they will not wait until inflation falls to their 2% target," wrote Michael Pearce, Deputy Chief U.S. Economist at Oxford Economics. "We still expect the Fed to begin cutting rates in September, and once per quarter thereafter."
-Taylor Tompkins
Watch for These Levels as Nike Shares Plummet
June 28, 2024 11:04 AM EDT
Nike (NKE) shares dropped more than 19% to about $76 Friday morning after the athletic apparel and equipment maker reported weaker-than-expected quarterly revenue and cut its sales outlook.
Nike shares trended sharply lower between late February and early April after the 50-day moving average (MA) crossed below the 200-day MA to form a bearish death cross signal. Since that time, the stock has oscillated within a rising wedge, a chart pattern that indicates a continuation of the current longer-term downtrend.
Investors can use the measured move technique to project where Nike shares may be headed after their post-earnings slump.
To do this, we calculate the distance in dollars of the most recent downtrend preceding the rising wedge and deduct that amount from the pattern’s lower trendline. In this case, we subtract $18 from $93 to arrive at a price target of $75.
This provides a possible area on the chart where bargain hunters may look for buying opportunities. Amid further weakness, it’s also worth monitoring if a prominent swing low that formed on the chart in October 2022 provides support around $82.
-Timothy Smith
Stocks Making the Biggest Moves in Early Trading
June 28, 2024 10:01 AM EDT
Gains:
- Trump Media & Technology Group (DJT): Shares of the former President’s media company, which operates the social media platform Truth Social, gained about 3% Friday morning following the first presidential debate of 2024.
- Infinera (INFN): Shares jumped 18% after Finnish telecommunications company Nokia (NOK) announced plans to buy the semiconductor manufacturer for $2.3 billion.
- UnitedHealth Group (UNH): The healthcare giant’s stock rose 2% after announcing a $20 million settlement with the Department of Justice Thursday over claims that OptumRx, one of United’s subsidiaries, illegally filled opioid prescriptions that should have raised red flags over potentially not being for medical use.
Losses:
- Nike (NKE): The apparel giant’s stock slumped 18% after earnings released after the bell Thursday contained revenue below expectations and a subpar outlook for fiscal 2025. Other apparel stocks like Skechers (SKX), Under Armour (UA), and Lululemon (LULU) were also lower.
- Rocket Pharmaceuticals (RCKT): Shares of the drugmaker fell 6% after the company said the FDA had turned away one of its products, requesting more information on the drug meant to treat an immunodeficiency disorder in children.
- Chewy (CHWY): The pet-focused e-commerce company’s shares fell 10%, coming back down to earth after getting caught in the meme stock craze and skyrocketing Thursday when Keith Gill, also known as “Roaring Kitty,” posted a dog-related meme on X.
Stock Futures Remain in Green Despite PCE Drop
June 28, 2024 08:56 AM EDT
Futures contracts connected to the Dow Jones Industrial Average were up less than 0.1% in premarket trading on Friday.
:max_bytes(150000):strip_icc()/YM1_2024-06-28_08-51-27-3fbfaab87b294024a3438153465b2362.png "Markets News, June 28, 2024: S&P 500, Nasdaq Retreat From Records; Indexes Notch Positive H1 (1)")
S&P 500 futures were up 0.2%.
:max_bytes(150000):strip_icc()/ES1_2024-06-28_08-51-35-f375c19341794e249abce7393149131b.png "Markets News, June 28, 2024: S&P 500, Nasdaq Retreat From Records; Indexes Notch Positive H1 (2)")
Nasdaq 100 futures gained 0.3%.
:max_bytes(150000):strip_icc()/NQ1_2024-06-28_08-51-42-cc638272b2134f52b2165c23e132153e.png "Markets News, June 28, 2024: S&P 500, Nasdaq Retreat From Records; Indexes Notch Positive H1 (3)")
