S&P futures are down 0.3% Thursday morning after a mixed performance on Wednesday, where big tech and retailers lagged, but healthcare, energy, and builders outperformed. Treasuries are firmer, the Dollar index is flat with yen strength highlighted, gold is up 0.7%, Bitcoin futures rose over 3%, and WTI crude gained 1.4%.
The focus is on NVIDIA (NVDA-US) post-earnings, where Jan Q guidance met expectations but failed to exceed elevated market hopes, despite positive commentary on the Blackwell ramp and AI demand. Geopolitical tensions remain an overhang, with reports of Russia launching an ICBM at Ukraine. Regulatory challenges are also in focus, with the DOJ recommending that Google (GOOGL-US) divest its Chrome browser to address monopolization concerns. Economic data today includes initial claims, Philly Fed manufacturing, and existing home sales.
Key Corporate Highlights
- NVIDIA (NVDA-US): Fell after earnings, as Jan Q guidance met but did not exceed consensus; positive outlook for Blackwell launch and AI demand.
- Google (GOOGL-US): DOJ recommended divestiture of Chrome to address search market monopolization; ruling expected by August 2024.
- Palo Alto Networks (PANW-US): Weaker after missing on billings, overshadowing better RPO and ARR metrics.
- Snowflake (SNOW-US): Up significantly on product revenue strength, raised FY25 guidance, and new product initiatives.
- Starbucks (SBUX-US): Reportedly considering selling its stake in its China business.
- Deere (DE-US): FY25 guidance came in light but viewed as better than feared given agricultural market challenges.
- Jack in the Box (JACK-US): Dropped on Q4 comps and margins miss; FY25 EPS guidance fell below expectations.
- Futu (FUTU-US): Reportedly cutting 5% of its workforce.
U.S. equities closed mixed on Wednesday, with the Dow up 0.32%, the S&P 500 flat, the Nasdaq down 0.11%, and the Russell 2000 up 0.03%. Stocks ended near session highs after reversing early weakness. Big tech was a notable laggard, including NVIDIA (NVDA-US) ahead of its highly anticipated earnings release and Alphabet (GOOGL-US) as it prepares a detailed antitrust proposal. Outperforming sectors included housing-related retail, homebuilders, credit cards, managed care, energy, and entertainment. Weaker sectors included semiconductors, discount retail, dollar stores, banks, apparel retail, and airlines.
Treasuries were weaker across the curve, with today’s $16B 20-year bond auction tailing slightly. The Dollar index rose 0.5%, gold gained 0.8%, Bitcoin futures increased 2%, and WTI crude settled 0.7% lower after earlier gains.
The market remains focused on NVIDIA’s earnings report, with expectations of strong AI-driven demand but concerns over stretched positioning and uncertainty about Blackwell ramp timing. Marc Rowan has reportedly emerged as the leading contender for Treasury Secretary, seen as a market-friendly pick. The holiday-shortened week is expected to remain quiet, with more significant macroeconomic data slated for December.
Company News by GICS Sector
Information Technology
- NVIDIA (NVDA-US): Continued to trade lower ahead of earnings as the market awaits Q3 results amid high expectations driven by AI demand.
- Keysight Technologies (KEYS-US): Gained 8.8% after a Q4 EPS and revenue beat; guidance exceeded consensus, with AI driving significant wireline business growth.
- Trade Desk (TTD-US): Rose 3.8% after unveiling its own smart TV operating system, “Ventura.”
- Fabrinet (FN-US): Dropped 9% after B. Riley downgraded the stock to “Sell,” citing unbundling trends in NVIDIA GPU platforms that threaten Fabrinet’s optics business.
Consumer Discretionary
- Target (TGT-US): Plunged 21.4% after missing Q3 estimates on comps, revenue, and margins; Q4 guidance was below expectations, citing cost pressures and uneven consumer spending.
- Chewy (CHWY-US): Gained 5.1% after being upgraded to “Buy” at Bank of America, citing improved pet adoption trends and stabilized spending.
- La-Z-Boy (LZB-US): Rose on earnings and revenue beats, with the company noting it is outperforming industry trends despite softness in home furnishings.
Health Care
- Inspire Medical Systems (INSP-US): Increased 5% after being upgraded to “Buy” at Bank of America, highlighting durable margin growth and increasing eligibility for Inspire’s procedures.
- Lantheus Holdings (LNTH-US): Up 8.8% after authorizing a $250M stock buyback program.
Industrials
- Powell Industries (POWL-US): Declined 16.1% despite an EPS beat as revenue missed; flagged decelerating growth and stagnant backlog.
- Dycom Industries (DY-US): Dropped 12.9% as Q4 guidance came in below expectations, with analysts citing weather impacts and project timing concerns.
Materials
- Azek Co (AZEK-US): Gained 3.8% on FQ4 revenue and earnings beats, with strong residential sell-through and favorable inventory trends. FY25 guidance was above consensus.
Consumer Staples
- e.l.f. Beauty (ELF-US): Fell 2.2% after Muddy Waters announced a short position, alleging revenue overstatements and inflated inventory levels.
- Global-e Online (GLBE-US): Gained 12% on Q3 EPS and revenue beats; FY24 guidance was raised on accelerating growth in GMV.
Communication Services
- Roku (ROKU-US): Fell 6.7% after Trade Desk announced its competing smart TV operating system.
- Dolby Laboratories (DLB-US): Rose 15.6% on an EPS beat and a 10% dividend increase; FY25 guidance highlighted growth in Dolby Atmos and Vision.
- Comcast (CMCSA-US): Announced plans to spin off NBCUniversal’s cable TV networks.
Financials
- Lemonade (LMND-US): Jumped 16% after Morgan Stanley upgraded it to “Equal Weight,” citing progress toward profitability and long-term premium growth.
Eco Data Releases | Thursday November 21st, 2024
S&P 500 Constituent Earnings Announcements | Thursday November 21st, 2024
Data sourced from FactSet Research Systems Inc.
