Stock Market Performance
The stock market started the new week with losses but ended the session on an upbeat note. Moves in either direction were limited. The S&P 500 was down 0.3% at its low of the day and closed 0.3% higher, marking a fresh all-time high for the index. The Nasdaq Composite also logged a new record high, closing with a 0.4% gain.
Key Drivers
- Resilience to Early Selling: The market showed nice resilience to early selling efforts, which turned into upside support.
- NVIDIA (NVDA, Financial): Turnaround action in shares of NVIDIA (NVDA) also provided support to the broader market. Shares had been down as much as 3.2% at session lows but ended the day up 0.8%.
- Eli Lilly (LLY, Financial): Eli Lilly (LLY) was another influential winner after an FDA advisory panel voted 11-0 to recommend LLY's donanemab as a treatment for early-stage Alzheimer's disease. The stock rose 1.8%.
- Vanguard Mega Cap Growth ETF (MGK): Other mega caps also closed with gains, leading the Vanguard Mega Cap Growth ETF (MGK) to close 0.3% higher.
- Apple (AAPL, Financial): Apple (AAPL) was an exception in the mega cap space, extending an early loss after introducing "Apple Intelligence," the personal intelligence system for iPhone, iPad, and Mac, at its Worldwide Developers Conference. The stock fell 1.9%.
Bond Market
Today's $58 billion 3-year note sale met soft demand, but Treasuries settled little changed from levels seen before the results. The 10-year note yield rose four basis points to 4.47%, and the 2-year note yield rose one basis point to 4.88%.
Economic Data
There was no U.S. economic data of note today, but anticipation in front of Wednesday's release of the May Consumer Price Index contributed to the muted action in the stock market today. Wednesday's calendar also features the latest FOMC policy decision, which will be accompanied by an updated Summary of Economic Projections and Fed Chair Powell's press conference.
Tuesday's Economic Lineup
Tuesday's economic lineup is limited to the NFIB Small Business Optimism at 6:00 ET.
Today's News
DXC Technology (DXC, Financial) surged 12% following reports that private equity firm Apollo Global (APO, Financial) and Kyndryl (KD, Financial) are in discussions for a joint bid to acquire the information technology services firm. The offer is rumored to be between $22 and $25 per share. DXC is also exploring the sale of its insurance software business for over $2 billion but may choose to remain independent. The stock saw an additional 4% gain in after-hours trading.
Developers of the Mountain Valley natural gas pipeline project, operated by Equitrans Midstream (ETRN, Financial), requested the Federal Energy Regulatory Commission to authorize the beginning of service by June 11. Equitrans, which is set to be acquired by EQT Corp. (EQT, Financial) in a $35B-plus deal, stated that it had met all safety requirements. The project has faced numerous regulatory and legal challenges, delaying its completion.
Trump Media & Technology (DJT, Financial) saw its stock fall 6% by midday Monday after amending its S-1 filing to include the resale/issuance of up to 14.37M shares upon exercise of warrants. The company will not receive proceeds from sales by selling security holders. The filing also incorporates a re-audit of financial statements for 2022 and 2023.
Apple (AAPL, Financial) announced at its developer's conference that the iPad will finally get a Calculator app as part of iPadOS 18. The app will support Apple Pencil, allowing users to write math problems directly. This follows the addition of a native Weather app two years ago.
Snowflake (SNOW, Financial) shares fell 3.5% after cybersecurity firm Mandiant, owned by Google (GOOGL), detailed a data breach affecting approximately 165 customers. The breach was attributed to compromised customer credentials rather than a direct breach of Snowflake’s systems.
PayPal Holdings (PYPL, Financial) stock dipped 2.5% after Apple (AAPL, Financial) introduced Apple Pay online and Tap to Cash for Apple Wallet. This move comes amid Apple's broader push into financial services, as announced during its developer's conference.
A panel of FDA advisors voted unanimously that Eli Lilly's (LLY, Financial) donanemab is effective in treating Alzheimer's disease in patients with mild cognitive impairment and dementia. The vote was 11-0, with a recommendation for a safety warning due to potential brain hemorrhages. An FDA action date has not been set yet.
GE HealthCare (GEHC, Financial) announced leadership changes, naming Roland Rott as president and CEO of Imaging and Phil Rackliffe as president and CEO of Ultrasound and IGT, effective July 1, 2024. The segments will be combined to form a global business with more than $5 billion in annual revenue.
Merck & Co (MRK, Financial) continued its upward trend, marking its seventh consecutive day of gains. The stock closed up 0.63%, outperforming the broader S&P 500 market year-to-date.
Intel (INTC, Financial) responded to reports that it was halting a $25 billion expansion of its chip facility in Israel by stating that managing large-scale projects often involves adapting to changing timelines. The company remains committed to its Israeli operations.
Yext (YEXT, Financial) announced it will acquire Hearsay Systems for $125 million, with an additional $95 million contingent on performance targets. The acquisition aims to combine Yext’s digital presence management platform with Hearsay’s engagement solutions.
2U, Inc. (TWOU, Financial) will proceed with a 1-for-30 reverse stock split of its common stock, effective June 13, 2024. The stock will begin trading on a post-split basis on June 14, 2024.
JPMorgan Chase (JPM, Financial) named Sri Shivananda, formerly of PayPal (PYPL, Financial), as its new chief technology officer. Shivananda will succeed A.J. Lang, who announced his retirement earlier this year.
Ellington Financial (EFC, Financial) declared its monthly dividend of $0.13 per share, maintaining its forward yield of 13.09%. The dividend is payable on July 25, with a record date of June 28.
Apple (AAPL, Financial) kicked off its developer's conference by unveiling AI-centric updates to its operating systems, including a new AI system called Apple Intelligence. The system features tools for writing, summarizing, and creating original images.
Nvidia (NVDA, Financial) continues to be seen as a "generational opportunity" by Evercore ISI, with the potential to capture a 15% weight of the S&P 500. The company recently surpassed a $3 trillion market cap.
GameStop (GME, Financial) shares fell another 16% on Monday, adding to Friday's 40% decline. The drop followed a disappointing earnings report and a $75 million share offering, despite a positive endorsement from Keith Gill/Roaring Kitty.
AMD (AMD, Financial) was downgraded by Morgan Stanley, citing high investor expectations for its AI business. The firm now rates AMD as Equal Weight, preferring Nvidia (NVDA, Financial) and Broadcom (AVGO) for their AI prospects.
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