Article published at 9:15 a.m. CT
JJ Kinahan is Senior Vice President, Head of Retail Expansion and Alternative Investment Products at Cboe Global Markets, Inc. (Cboe).
Key Takeaways:
- Nasdaq again leads the pack
- Fed Minutes coming out this week
- Quiet period ends for SpaceX analyst reports
The markets are mixed in the early going as investors check in after the long holiday weekend. The Dow Jones Industrial index was hugging the flat line, slipping slightly while the S&P 500 was heading slightly higher by 0.35%. The Nasdaq Composite, on the other hand, has been the standout – again – up higher by 1.02%.
Tech stocks were rebounding after their mini-rotational trading late last week. Shares of Broadcom were higher by 5.08%, with Micron advancing 3.3% and Intel by 3.37%. Marvell added another 3% and Oracle was up by some 2%.
On the oil front, WTI is trading at $68.49 per barrel, its lowest level since late February, right before the conflict in Iran began. OPEC Plus, the Organization of Petroleum Exporting Countries plus a handful of others, said yesterday it is continuing its promises to boost production amid the volatility in the Middle East.
Tomorrow, SpaceX scores another historical market marker when it joins the Nasdaq 100, the largest nonfinancial companies on the Nasdaq Composite index. Nasdaq rewrote its policies recently to allow new publicly traded companies to join after only 15 days of trading, rather than three months. Today is SpaceX’s 25th day of trading. SpaceX’s inclusion forces funds tracking the Nasdaq 100 index to buy shares, if they haven’t already.
Maybe more important is the 25-calendar-day quiet period ends, meaning Wall Street analysts can start issuing research reports and ratings. Keep an eye out for what the overall ratings will be as well as the price targets.
Also on tap this week is the Federal Reserve’s minutes from last month’s Federal Open Market Committee meeting, which will offer a glimpse into what their thinking was behind holding interest rates steady last month with Fed Chair Kevin Warsh at the helm. Keep an eye out for them on Wednesday afternoon. The FOMC has taken on a hawkish tone and the minutes can give us some insight into what their thinking is on inflation and a possible interest rate hike later this year. The next meeting is slated for July 28 and July 29.
Earnings season doesn’t official kick off until next week, but we have some earnings reports coming out later this week that might give us some insight on how the American consumer is spending her money. Levi Strauss’ is expected to report on Wednesday, with Wall Street looking for earnings-per-share of $0.24 versus last year’s $0.22 a share. Pepsico’s earnings are scheduled to come out Thursday with earnings-per-share estimates of $2.19 compared with last year’s $2.12.
On Friday, Delta Airlines will open its books with expectations falling on a year-over-year basis to $1.44 a share compared with last year’s $2.10. Stay tuned for those reports.
In the mini rotational trading in the last week, we saw the Dow close at a record high Thursday, ahead of the long holiday weekend, as investors absorbed weak jobs data and a flight away from the tech-heavy Nasdaq. The 30-stock Dow closed at a record peak of 52,000, some 1.1% percent higher. The S&P also settled in negative territory, but just barely by 0.01%.
The Nasdaq fell back 0.8% as semiconductor stocks took a second straight day of knocks. The Dow jumped 1% and the S&P was flat, closing 0.01% in the red.
Nonfarm payrolls disappointed Wall Street by missing expectations by nearly half, turning in the June payrolls report at 57,000 compared with the 115,000 anticipated.
Happy trading!
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