The S&P 500 Index ($SPX) (SPY) today is down -0.07%, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.15%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.09%.
Stocks today are slightly lower, with the S&P 500 and Nasdaq 100 consolidating below Monday’s record highs. Some negative corporate news is weighing on stocks today with Zscaler down more than -4% after forecasting Q2 adjusted EPS below consensus. Also, Honeywell International is down more than -2% after cutting its full-year adjusted EPS forecast.
The markets are looking ahead to Wednesday’s Nov ISM services index (expected -0.5 to 55.5). Also, on Wednesday, Fed Chair Powell will speak at a moderated discussion event in New York. Finally, the markets are awaiting Friday’s Nov nonfarm payrolls (expected +200,000) and Nov average hourly earnings (expected to ease to +3.9% y/y from +4.0% y/y in Oct).Â
The markets are discounting the chances at 74% for a -25 bp rate cut at the December 17-18 FOMC meeting.
Overseas stock markets today are higher. The Euro Stoxx 50 rose to a 3-1/2 week high and is up +0.22%. China's Shanghai Composite Index climbed to a 2-week high and closed up +0.44%. Japan's Nikkei Stock 225 rallied to a 3-week high and closed up +1.91%.
Interest Rates
March 10-year T-notes (ZNH25) today are up +3 ticks. The 10-year T-note yield is down -0.8 bp to 4.182%. Mar T-notes today are slightly higher. Expectations that the FOMC will cut interest rates at the December 17-18 FOMC meeting are boosting T-note prices after Fed Governor Waller said Monday he’s leaning toward a Fed rate cut at the December FOMC meeting. Waller’s comments pushed the chances of a 25 bp rate cut at the December 17-18 FOMC meeting up to 74% from 55% on Monday. Supply pressures are limiting the upside in T-notes, with as much as $25 billion in corporate debt offerings expected this week, which prompts bond dealers to short T-notes as a hedge against the incoming new supply.Â
European government bond yields today are mixed. The 10-year German bund yield is up +1.3 bp to 2.047%. The 10-year UK gilt yield is down -0.3 bp to 4.210%.
Swaps are discounting the chances at 100% for a -25 bp rate cut by the ECB at its December 12 policy meeting and at 16% for a -50 bp rate cut at the same meeting.
US Stock Movers
Zscaler (ZS) is down more than -4% to lead losers in the Nasdaq 100 after forecasting Q2 adjusted EPS of 68 cents-69 cents, below the consensus of 70 cents.Â
Honeywell International (HON) is down more than -2% to lead losers in the Dow Jones Industrials after cutting its full-year adjusted EPS forecast to $9.68-$9.78 from a previous forecast of $10.15-$10.25, weaker than the consensus of $10.17.Â
Seagate Technology Holdings (STX) is down more than -2% after it said it sees Q3 production output lower than previously seen.
TransMedics Group (TMDX) is down more than -9% after forecasting 2024 revenue of $428 million-$432 million, the midpoint below the consensus of $431.9 million.Â
US Steel (X) is down more than -7% after President-elect Trump said he would block US Steel from being bought by Nippon Steel when he becomes president.Â
Live Nation Entertainment (LYV) is down more than -1% after announcing it intends to offer $1.0 billion in aggregate principal convertible senior notes due 2030.Â
CleanSpark (CLSK) is down more than -9% after it filed to delay its 10-K annual filing.Â
Microchip Technology (MCHP) is down more than -3% after saying it will shut down a plant in Arizona and forecast Q3 revenue will be close to the low end of its original guidance.Â
Super Micro Computer (SMCI) is up more than +5% to lead gainers in the S&P 500 and Nasdaq 100 and added to Monday’s +28% surge after a special committee found no evidence of misconduct by management or the board.Â
AT&T (T) is up more than +4% after predicting sustained profit growth over the next three years and authorizing a $20 billion share repurchase program.Â
Synchrony Financial (SYF) is up more than +2% after Wells Fargo Securities upgraded the stock to overweight from equal weight with a price target of $85.
Janux Therapeutics (JANX) is up more than +72% after announcing positive clinical data for its JANX007 cancer drug in 5L metastatic castration-resistant prostate cancer patients.Â
Axon Enterprise (AXON) is up more than +1% after Morgan Stanley upgraded the stock to overweight from equal weight with a price target of $700.Â
Citigroup (C) is up more than +1% after Keefe, Bruyette $ Woods upgraded the stock to outperform from market perform with a price target of $82.Â
Earnings Reports (12/3/2024)
Core & Main Inc (CNM), Donaldson Co Inc (DCI), Marvell Technology Inc (MRVL), Okta Inc (OKTA), Pure Storage Inc (PSTG), Salesforce Inc (CRM).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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