S&P futures are little changed Tuesday morning following a mixed Monday session where tech strength lifted the S&P 500 and Nasdaq, while cyclicals underperformed. Treasuries are weaker with curve steepening. Dollar index is down 0.2%, gold is up 0.3%, Bitcoin futures are down 1%, and WTI crude is up 1.2%.
Key Themes
Investors await further economic data, including October JOLTS today and Friday’s NFP, while seasonality, buybacks, Q4 GDP growth (tracking above 3%), and Fed easing expectations remain bullish drivers. Concerns persist over stretched valuations, Trump’s tariff threats, and European political risks.
Corporate Highlights
- X-US: Under pressure after Trump reiterated opposition to the Nippon deal.
- T-US: Gained on updated guidance and capital return plan ahead of analyst meeting.
- BLK-US: Confirmed $12B all-stock deal for HPS.
- MCHP-US: Issued a negative preannouncement for fiscal Q3, citing weaker turns orders and elevated inventories.
- ZS-US: Fiscal Q1 billings beat and raised FY25 guidance but flagged concerns over 2H ramp and CFO retirement.
- HON-US: Cut Q4 and FY24 guidance as part of a $17B agreement with Bombardier.
- CR-US: Announced sale of Engineered Materials business for $227M.
- SHO-US: Gained on Bloomberg report of takeover interest.
The S&P 500 (+0.24%) and Nasdaq (+0.97%) reached fresh record highs on Monday, though gains were uneven as cap-weighted S&P outpaced the equal-weight index. Big tech, semiconductors, and tech hardware were among the leaders, while energy, utilities, and real estate lagged. Treasuries weakened following last week’s rally, and the dollar index gained 0.5%. ISM manufacturing data showed strength, while Black Friday retail sales posted a 3.4% y/y increase.
Key Themes
- Economic Data: ISM manufacturing index showed expansion in new orders for the first time in eight months. Employment metrics posted their largest gain since August 2023, while construction spending in October surprised to the upside.
- Macro Themes: Geopolitical risks persisted as Trump threatened 100% tariffs on BRIC nations but emphasized a positive meeting with Canada’s PM Trudeau. China’s improved PMIs and Black Friday retail data provided additional market support.
- Market Sentiment: Investors remained focused on big tech strength and Black Friday spending trends, while cyclicals and rate-sensitive names underperformed.
Stock-Specific News by GICS Sector
Information Technology
- SMCI-US (Super Micro Computer) +28.7%: Independent review found no fraud or misconduct; no restatements expected. Announced CFO transition and planned new executive hires.
- OKTA-US (Okta) +4.2%: Upgraded to overweight by Morgan Stanley, citing a stabilizing demand backdrop and easing competition in the sector.
- AKAM-US (Akamai Technologies) +4.2%: Upgraded to outperform by Oppenheimer, highlighting CDN space consolidation and extended tailwinds in volumes and pricing.
- UPST-US (Upstart Holdings) -14.5%: Downgraded to underweight by JP Morgan, citing valuation concerns and potential overpricing of expected third-party funding improvement in 2025.
- LC-US (LendingClub) -4.9%: Downgraded to neutral by JP Morgan following significant price strength YTD and concerns over the slow materialization of growth roadmaps.
Consumer Discretionary
- TSLA-US (Tesla) +3.5%: Upgraded to buy by Roth MKM, citing demand optimism linked to CEO Musk’s Trump endorsement, AI opportunities, and better regulatory outlook for CyberTaxi.
- GAP-US (Gap) +6.4%: Upgraded to overweight by JP Morgan, highlighting strong holiday season momentum and a promising revenue-growth streak.
- STLA-US (Stellantis) -6.3%: CEO Carlos Tavares resigned over “different views” with the board; the company is searching for a successor with plans to conclude the process by 1H25.
- TOST-US (Toast) -2.7%: Downgraded to neutral by Goldman Sachs, citing valuation concerns following a ~135% YTD gain.
Health Care
- PTCT-US (PTC Therapeutics) +18.7%: Announced a $1.0B upfront and up to $1.9B milestone collaboration deal with Novartis for its Huntington’s disease program.
- TNDM-US (Tandem Diabetes Care) +6.1%: Upgraded to overweight by Morgan Stanley, citing improved valuation and optimism around the MOBI rollout.
Industrials
- DAN-US (Dana) +13.3%: Upgraded to overweight by Barclays, with analysts highlighting value creation potential from its Off-Highway sale and $200M cost-cutting initiative.
Communication Services
- FOSL-US (Fossil Group) +61%: CEO purchased 250K shares, fueling a sharp rally in the stock.
- NVCR-US (Novocure) +49%: Positive phase 3 trial data for TTFields in pancreatic cancer, showing significant improvements in survival rates.
Financials
- BLK-US (BlackRock): Reportedly nearing a $12B deal to acquire HPS Investment Partners in a cash and stock transaction.
Eco Data Releases | Tuesday December 3rd, 2024
S&P 500 Constituent Earnings Announcements | Tuesday December 3rd, 2024
Data sourced from FactSet Research Systems Inc.
