Markets News, July 2, 2024: Nasdaq, S&P 500 Notch Records; Tesla Soars on Deliveries Beat

What’s Behind Gold’s Solid First Half?

3 hr 12 min ago

Gold has been one of the best-performing global assets of 2024, and central banks around the world have been instrumental in its outperformance.

Global official gold reserves increased by 290 metric tons in the first quarter of this year, the largest first-quarter increase since at least 2000 and 69% higher than the five-year quarterly average, according to the World Gold Council.

In May, central banks reported net buying of 10 metric tons of gold, according to the International Monetary Fund (IMF) and other sources.

What’s more, the 2024 Central Bank Gold Reserves Survey, conducted between February and April, found that 29% of central bank respondents planned to increase their gold reserves over the next 12 months.

“A desire to rebalance to a more preferred strategic level of gold holdings, domestic gold production, and financial market concerns including higher crisis risks and rising inflation,” were among the reasons central banks have been stocking up on gold, according to the council.

See here for more on the outlook for gold in the second quarter of the year.

–Andrew Kessel

Paramount Gains on Reports of Possible Bid by Barry Diller

4 hr 5 min ago

Paramount Global (PARA) was one of the best-performing stocks in the S&P 500 Tuesday afternoon, with shares up more than 4% following a report by The New York Times that billionaire Barry Diller was exploring a bid to take control of the entertainment giant.

In the latest twist in the battle for the owner of CBS and Nickelodeon, Diller’s media conglomerate, IAC, has reportedly signed nondisclosure agreements with National Amusements, Paramount’s controlling shareholder. (IAC is the owner of Investopedia parent Dotdash Meredith.)

The nondisclosure agreements were signed sometime after Paramount’s deal with Skydance Media fell apart last month when National Amusements owner Shari Redstone reportedly called off the monthslong merger talks.

–Nisha Gopalan

Adobe, Birkenstock Added to Deutsche Bank’s Top Picks for Q3

4 hr 47 min ago

Deutsche Bank updated its “Fresh Money List” for the third quarter in a note on Tuesday, with Adobe (ADBE) and Birkenstock (BIRK) among the names added to the list of 36 top analyst picks. 

“Adobe looks well-positioned to carry its momentum into 2H, following better than expected F2Q results,” analyst Brad Zelnick wrote. Zelnick saw evidence in Adobe’s latest quarterly results that the design software firm has seen some success monetizing generative AI, doubts about which weighed on the stock early in the year.

Birkenstock was another fresh face on Deutsche Bank’s list. “We believe the market still under-appreciates BIRK’s industry-leading margins, which combined with the company’s long-runway for top-line growth, deserves a premium valuation,” wrote analyst Krisztina Katai. 

Other new additions to the list included Caesars Entertainment (CZR), Corpay (CPAY), Synchrony Financial (SYF), and Uber (UBER). Amazon (AMZN), Chipotle (CMG), Delta Airlines (DAL), and Merck (MRK) were among the carryovers from the second-quarter list.

CrowdStrike Slips Following Piper Sandler Downgrade

5 hr 34 min ago

CrowdStrike (CRWD) shares fell in intraday trading Tuesday after the stock received a downgrade from Piper Sandler, which cited the cybersecurity firm’s high valuation and shortage of near-term catalysts.

Piper Sandler lowered its rating to “neutral” from “overweight,” keeping unchanged its price target of $400.

The analysts said that while they “remain excited about the next act, with many incremental growth opportunities,” the risk/reward on the stock is “less favorable at this time given the strong run.”

They noted that CrowdStrike’s already high annual recurring revenue (ARR) and estimated fiscal year revenue will make it difficult for any meaningful upside to occur, as “the law of large numbers should begin to weigh on overall growth rates.”

Shares of CrowdStrike slipped more than 2% to about $383 Tuesday, but are up about 50% year-to-date.

–Bill McColl

Citi Downgrade of Lennar, DR Horton Drags on Home Builders

6 hr 35 min ago

Shares of several home builders tumbled Tuesday after Citi downgraded Lennar (LEN) and D.R. Horton (DHI), citing concerns about a housing market it says may stay sluggish for the rest of the year.

Citi cut its ratings on the companies’ shares to Neutral from Buy. It also cut its price targets on the stocks, as well as those of Forestar Group (FOR), Pultegroup (PHM), and Toll Brothers (TOL).

The analysts said they saw “softness in the data” potentially continuing in the second half of the year, saying that housing permits, starts, sales, and prices have recently come in below expectations.

Shares of Lennar and D.R. Horton sank more than 2% to trade at their lowest levels since December. Shares of the other three home builders by Citi fell, too.

–Bill McColl

Tesla Stock Surges as Q2 Deliveries Beat Estimates

7 hr 43 min ago

Tesla (TSLA) shares surged Tuesday following the release of second-quarter production and delivery numbers, which fell year-over-year but surpassed analysts’ expectations.

The electric vehicle giant delivered 443,956 vehicles in the second quarter and produced 410,831 vehicles, and announced that it will release its Q2 financial results after the bell on July 23.

Wedbush analysts wrote in a note immediately following the Q2 deliveries release that they believe “the worst is in the rear view mirror for Tesla.”

Tesla shares surged more than 8% Tuesday morning to trade above $228, their highest point since January. Still, Tesla stock is down more than 8% so far this year.

–Aaron McDade

Watch These Key WTI Oil Price Levels As Chart Signals Possible Breakout 

8 hr 38 min ago

West Texas Intermediate (WTI) crude oil jumped more than 2% to an eight-week high on Monday amid expectations of improving demand over the summer travel months and growing concerns that a regional expansion of the Middle East conflict could disrupt global oil supplies.

Zooming out to the weekly chart, the commodity’s price has traded within a symmetrical triangle since September last year to establish easily identifiable support and resistance areas. The pattern, which consists of two converging trend lines connecting a series of sequential peaks and troughs, represents equilibrium between the bulls and bears, but is often followed by a significant move in the direction of the breakout.

In this case, WTI appears poised to break out to the upside as the 50-week moving average (MA) sits above to 200-week MA and the price trades near the symmetrical triangle’s upper trendline. However, given the commodity’s volatility, investors should also be prepared for a breakdown from the pattern.

See here for more on WTI price levels to watch.

–Timothy Smith

Stock Futures Slip Ahead of JOLTS, Powell Comments

9 hr 28 min ago

Futures contracts connected to the Dow Jones Industrial Average were down 0.2% in premarket trading.

S&P 500 futures fell 0.4%.

Nasdaq 100 futures were off 0.5%.