Market Recap: July 24, 2023 - Nio Soars, Upcoming Interest Rate, and More Key Happenings

Hi, Traders! As the day comes to an end, we are excited to have you here for an insightful recap of the noteworthy events that have influenced the financial markets today.

Significant Week for Global Monetary Policy as U.S. Federal Reserve, ECB, and Bank of Japan Set to Announce Key Interest Rate Decisions 🌎💼

This week is set to be significant for global monetary policy as the U.S. Federal Reserve, the European Central Bank (ECB), and the Bank of Japan are due to announce key interest rate decisions. The market expects a 25 basis point increase from both the Federal Reserve and the ECB, despite the Federal Reserve's halt in its consecutive interest rate hikes last month. The focus will be on the guidance the Fed provides regarding future rate paths, especially given signs of cooling inflation and the labor market. The ECB, after a steady increase in interest rates since July 2022, is likely to continue its hawkish tone, although the future direction is less clear. The Bank of Japan, amidst an economy heating up and inflation exceeding the target, is expected to maintain its -0.1% short-term interest rate target, continuing its ultra-dovish stance. Consequently, the rate differentials between the U.S. and Japan’s central banks are likely to persist. The upcoming announcements are viewed as potential turning points in the monetary policy trajectories of these central banks.

Indexes 📈🚀

the indices rose today with the Dow Jones Industrial Average increasing the most, marking the start of a busy week characterized by significant earnings reports and a crucial policy decision by the Federal Reserve. Now, let's explore how the market performed today...

The S&P 500 (SPX) was up +0.40% coming to a conclusion at 4,554

The Nasdaq Composite (IXIC) escalated by +0.19% to settle at 14,058

The Dow Jones Industrial Average (DJI) climbed +0.52% to finish at 35,411

The Russell 2000 (RUT) increased by +0.28% ending the day at 1,965

The Nasdaq-100 (NDX) rose +0.14% to conclude at 15,448

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Spotify Announces Price Increase for Premium Subscriptions in the U.S.🎵💲

On Monday, music streaming platform Spotify (SPOT) announced it will raise the price of its Premium subscription offerings in the U.S. by up to $2, a 20% increase for some plans. This price hike, which comes in response to the evolving market landscape, is expected to help the company continue to deliver value to fans and artists. Existing subscribers will be informed about the changes via email and will be given a "one-month grace period" before the new prices apply.

SPOT:

163.82 ▼ -7.89 (-4.59%) Today

162.10 ▼ -1.62 (-0.99%) After Hours

Apple Considers Price Hike for iPhone Pro Models, Opens Applications for Vision Pro Developer Kits 🍎💰

Apple (AAPL), the tech giant, is reported to be considering a price hike for its premium iPhone Pro models upon their release in the fall, as per a Bloomberg News report. Since 2019, Apple's high-end iPhone Pro has been sold in the U.S. starting at $999 with the Max model's larger screen starting at $1,099. This new price increase may boost Apple's revenue by raising the new iPhone's average selling price. Despite parts shortages and inflation, Apple did not increase new iPhone model prices in the U.S. but adjusted prices in response to global currency fluctuations. There is anticipation that the new Pro models might feature a USB-C charger, in line with new European regulations, and a titanium case with thinner bezels. This price increase is believed to be a strategic move to capitalize on current smartphone market trends, where consumers continue to show interest in premium devices, despite an overall decline in smartphone shipments.

Apple has opened up applications for Vision Pro developer kits, ahead of a 2024 launch for the $3,499 headset. The developer kit is a loan to selected developers, not a sale, allowing them to build and fine-tune their apps using actual Apple hardware. Confidentiality agreements, location restrictions, and restrictions on public discussion of the hardware are among the conditions set by Apple for developers.

AAPL:

192.75 ▲ +0.81 (+0.42%) Today

192.80 ▲ +0.05 (+0.026%) After Hours

Nio on Positive Trajectory Following China's NDRC Support and Expansion Plans 🚗📈

Chinese EV company, Nio (NIO), is on a positive trajectory following China's National Development and Reform Commission (NDRC) pledge to support investments in several sectors including transportation, clean energy, and infrastructure. This announcement follows Nio's 2023 Power Day event where the company announced the installation of 1,564 battery swap stations across China, expecting to reach 1,600 soon. Furthermore, Nio plans to install its first third-generation battery swap station in Europe next month and aims to have 50 such stations across Europe by year-end. The company recently amended its battery leasing program, allowing drivers to swap to a higher-density battery on a daily basis for a fee, improving both safety and energy efficiency. The company aims to install 1,000 new battery swap stations by the end of 2023. Despite the promising growth, JPMorgan analyst Nick Lai maintained a "neutral" rating on Nio shares but raised the price target from $8.50 to $9.

NIO:

11.74 ▲ +1.16 (+10.96%) Today

11.91 ▲ +0.18 (+1.53%) After Hours

ALPA Rejects Tentative Contract Deal with FedEx, Negotiations to Be Reopened ✈️👨‍✈️

The Air Line Pilots Association (ALPA) rejected a tentative contract deal with FedEx (FDX), leading the two sides to reopen negotiations, likely under the supervision of the National Mediation Board. Despite the rejected deal, which included a 30% pay increase and a 30% increase to the pilots' legacy pensions, FedEx stated the vote will have no impact on its service. With fewer pilots and rebounding demand, U.S. unions have been gaining increased bargaining power in negotiations over the past year.

FDX:

258.77 ▼ -0.90 (-0.35%) Today

258.40 ▼ -0.37 (-0.14%) After Hours

Johnson & Johnson to Reduce Stake in Kenvue by 80% via Stock Exchange Offer 🔻🔄

Johnson & Johnson (JNJ) announced on Monday its plans to cut down its stake in Kenvue (KVUE), its consumer health business, by at least 80% via a stock exchange offer. J&J shareholders will have the opportunity to exchange all or part of their shares for Kenvue's common stock at a 7% discount. This offer, which is expected to be tax-free, marks a significant step in J&J's strategic refocus on its pharmaceutical and medtech businesses. The exchange offer, also known as a split-off, is voluntary for investors and is scheduled to close on August 18th.

JNJ:

171.10 ▲ +0.91 (+0.53%) Today

171.10 ▲ +0.02 (+0.012%) After Hours

KVUE:

24.16 ▲ +0.15 (+0.62%) Today

24.04 ▼ -0.12 (-0.50%) After Hours

Chevron's Q2 Earnings Beat Estimates, Permian Basin Production at All-Time High 🏭📈

Chevron (CVX) second-quarter earnings surpassed Wall Street estimates, as revealed by the company on Sunday. Despite a slight softening in the macro price environment, the $6 billion net profit for the quarter ended June 30 reflected a robust quarter with high levels of operational performance and minimal unplanned downtime. Notably, Chevron's oil and gas production in the Permian Basin hit an all-time high of 772,000 barrels per day, marking a 10% increase from the same quarter last year. The company also signaled its continued openness towards acquisitions and increasing shareholder distributions.

CVX:

161.77 ▲ +3.08 (+1.94%) Today

161.78 ▼ -0.04 (-0.025%) After Hours

Worldcoin Sees Token Value Surge on First Trading Day, Co-Founded by OpenAI CEO Sam Altman 🌐💰

Worldcoin, the cryptocurrency project co-founded by OpenAI CEO Sam Altman, saw its token value surge on its first trading day as investor interest in AI grew. The coin value jumped to as high as $3.58 from the initial $1.70 price, with approximately $145 million worth of the token traded. Worldcoin utilizes a device known as an "orb" to scan people's eyeballs, creating a unique digital identity for each individual, thus granting them "proof of personhood." Although the coin's initial supply is capped at 10 billion tokens, regulatory restrictions prevent it from being traded in the U.S.

AMC Entertainment's Stock Surges After Court Denies Proposal and Successful Movie Weekend 🚀🎥

AMC Entertainment Holdings (AMC) saw its stock surge 33.73% after a Delaware court denied its proposal to convert AMC preferred equity shares into regular AMC shares, coupled with the company's most successful weekend in four years. Two film releases drew 7.8 million moviegoers to AMC theaters, resulting in the highest single-day attendance since July 2019, and the second-highest daily food and beverage revenue. Despite this, AMC's quarterly revenue is still below 2019 levels due to the pandemic's impact. The company has utilized its "meme stock" status to raise capital, but with shares down 60% this year, CEO Adam Aron emphasized in an open letter the necessity of raising fresh equity to safeguard the company's future amidst the uncertainty posed by ongoing writers and actors strikes.

AMC:

5.84 ▲ +1.44 (+32.73%) Today

5.34 ▼ -0.51 (-8.72%) After Hours

UPS Faces High-Stakes Labor Dispute with Teamsters, Potential Strike Concerns 🚚💵

United Parcel Service (UPS) is preparing to negotiate a high-stakes labor dispute with the International Brotherhood of Teamsters, representing its 340,000 delivery and warehouse workers. The current labor contract expires on August 1, and a potential strike would be the largest against a single business in U.S history. The economic cost of a 10-day strike is estimated at $7 billion, and could severely impact the U.S supply chain. UPS and the Teamsters have agreed on several issues but remain at odds over pay rates for part-time union workers. UPS is committed to increasing industry-leading pay and benefits but emphasizes the need for a swift resolution.

UPS:

188.34 ▲ +1.04 (+0.56%) Today

188.30 ▼ -0.04 (-0.021%) After Hours

After Hour Movers 🌙📊

Cadence Design Systems (CDNS) reported a second-quarter profit of $221.1 million, with a net income of 81 cents per share. Adjusted earnings, excluding stock option expense and amortization costs, were $1.22 per share, surpassing Wall Street expectations of $1.18 per share. The company, known for its hardware and software products for chip design validation, posted revenue of $976.6 million in the period, exceeding Street forecasts of $973.2 million. For the full year, Cadence anticipates earnings in the range of $5.05 to $5.11 per share, with revenue between $4.05 billion and $4.09 billion.

CDNS:

241.27 ▼ -1.59 (-0.65%) Today

230.95 ▼ -10.32 (-4.28%) After Hours

NXP Semiconductors NV (NXPI) reported second-quarter earnings of $698 million, with a profit of $2.67 per share. Adjusted earnings, which excluded stock option expense and amortization costs, were $3.43 per share, beating Wall Street expectations of $3.27 per share. The chipmaker posted revenue of $3.3 billion in the period, surpassing Street forecasts of $3.2 billion. For the current quarter ending in September, NXP anticipates per-share earnings to range from $3.39 to $3.82, with revenue projected to be between $3.3 billion and $3.5 billion for the fiscal third quarter.

NXPI:

210.88 ▼ -2.42 (-1.13%) Today

214.00 ▲ +3.12 (+1.48%) After Hours

Whirlpool (WHR) declined 1% after the company's mixed earnings announcement. The kitchen and laundry company reported adjusted earnings per share of $4.21, surpassing Refinitiv analysts' estimates of $3.76 earnings per share. However, Whirlpool's revenue fell below expectations, with the company reporting $4.79 billion compared to analysts' projections of $4.82 billion.

WHR:

150.80 ▲ +1.07 (+0.71%) Today

149.07 ▼ -1.69 (-1.12%) After Hours

F5 (FFIV), the cloud-based software company, experienced an 8% increase in its shares after reporting better-than-expected results for its fiscal third quarter. The company posted adjusted earnings of $3.21 per share on revenue of $703 million, surpassing analysts' expectations of $2.86 in earnings per share and revenue of $699 million, according to Refinitiv.

FFIV:

150.21 ▲ +1.39 (+0.93%) Today

163.51 ▲ +13.30 (+8.85%) After Hours

ChampionX Corporation (CHX) reported a net income of $95.8 million in its second quarter, amounting to 48 cents per share. Adjusted earnings, excluding non-recurring costs, were 49 cents per share. However, the company's revenue for the period was $926.6 million, which did not meet Street forecasts. Analysts had expected revenue of $978.4 million, according to Zacks.

CHX:

35.06 ▲ +0.26 (+0.75%) Today

33.99 ▼ -1.07 (-3.05%) After Hours

TrueBlue (TBI) reported a loss of $7.3 million in its second quarter, resulting in a loss of 24 cents per share. However, after adjusting for asset impairment costs and amortization costs, the company's earnings were 17 cents per share. The blue-collar temporary staffing company recorded revenue of $475.6 million for the period.

TBI:

18.29 ▲ +0.20 (+1.11%) Today

16.00 ▼ -2.29 (-12.52%) After Hours

Sectors 🔌💧

Out of the 11 sectors, 9 closed in positive territory today, with Energy leading the way with a gain of +1.66%, while Utilities saw a decline of -0.28%.

Conclusion 👋

To wrap it up, today's market recap provides valuable insights into the noteworthy events that have influenced the financial markets. The upcoming week is set to be significant for global monetary policy as the U.S. Federal Reserve, the European Central Bank (ECB), and the Bank of Japan announce key interest rate decisions. Investors are closely watching for guidance on future rate paths, especially given signs of cooling inflation and labor market conditions. The stock market experienced overall gains, with the Dow Jones Industrial Average leading the way, amid crucial earnings reports and the Federal Reserve's policy decision. In the tech sector, Spotify announced a price increase for its Premium subscriptions, while Apple is considering raising prices for its iPhone Pro models. Moreover, Johnson & Johnson plans to reduce its stake in Kenvue, Chevron reported strong earnings and record production in the Permian Basin, and Worldcoin saw a surge in token value on its trading debut. AMC Entertainment's stock surged after a court denied its proposal and successful movie weekend, while UPS faces a high-stakes labor dispute with the Teamsters. The market also witnessed after-hours movers like Cadence Design Systems, NXP Semiconductors, Whirlpool, F5, ChampionX Corporation, and TrueBlue. See you all tomorrow!

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