Markets News, April 16, 2024: UnitedHealth Boosts the Dow as S&P 500 Slips; Treasury Yields Climb (2024)

Stock Indexes Wrap: UnitedHealth Boosts the Dow; Semiconductors Gain as Banks Lose Ground

April 16, 2024 04:11 PM EDT

The Dow

UnitedHealth Group (UNH) rose 5.3% after reporting better-than-expected revenue and earnings in the first quarter.

Salesforce (CRM) rose 1.7%, rebounding somewhat from yesterday’s slump following reports the company was in talks to acquire data management software provider Informatica.

Other tech companies also advanced, including International Business Machines (IBM), up 1.4%, and Microsoft (MSFT), up 0.2%.

Johnson & Johnson (JNJ) slipped 2.2% after the healthcare giant reported weaker-than-expected sales in the first quarter, overshadowing an earnings beat.

Apple (AAPL) slipped 1.9% after analysts at Needham and Evercore expressed concern about the tech giant’s first-quarter sales and ongoing antitrust litigation.

The S&P 500

Super Micro Computer (SMCI) rose 10.6% after analysts at Loop Capital raised their price target to $1,500 from $600 and reiterated their buy rating.

Morgan Stanley (MS) rose 2.5% after the investment bank’s first-quarter earnings topped Wall Street estimates.

Health insurers got a boost from UnitedHealth’s earnings. Elevance Health (ELV) ticked up 1.4% and Humana (HUM) gained 0.8%.

Live Nation Entertainment (LYV) tumbled 7.5% following reports the Justice Department was preparing to file an antitrust lawsuit against the live entertainment production and ticketing company.

Northern Trust (NTRS) slid 5% after the asset manager reported first-quarter profit significantly below analysts’ expectations.

Bank of America (BAC) lost 3.5% after reporting revenue and net interest income declined in the first quarter.

Bank of New York Mellon (BK) slipped 2% despite beating analyst estimates with its quarterly earnings as markets focused on an 8% decline in net interest income.

PNC Financial (PNC) also fell 2% after missing first-quarter revenue estimates and reporting a 21% decline in profit.

The Nasdaq 100

Semiconductor stocks advanced, led by ASML Holding (ASML), up 2.3%, and Nvidia (NVDA), up 1.6%.

Advanced Micro Devices (AMD) rose 2% after it unveiled new AI PC processors, part of its efforts to take some of the AI chip market from leader Nvidia.

Tesla (TSLA) shed 2.7%, continuing to slide after yesterday’s sell-off following reports it planned to lay off more than 10% of its staff.

Johnson & Johnson Stock Slips After Mixed Q1 Earnings Report

April 16, 2024 03:03 PM EDT

(JNJ) posted mixed first-quarter earnings Tuesday, and raised its dividend while narrowing full-year guidance for 2024.

Sales narrowly missed expectations, with Johnson & Johnson posting $21.38 billion in total sales, shy of the $21.44 billion analysts expected, according to estimates compiled by Visible Alpha. The healthcare technology and pharmaceutical giant also reported adjusted net income of $6.58 billion, or $2.71 per share, beating estimates of $6.39 billion and $2.62 per share, respectively.

Revenue increased 2.3% from last year's first-quarter mark of $20.89 billion, with adjusted income and EPS rising 3.8% and 12.4%, respectively, from last year's figures of $6.34 billion and $2.41 per share.

Johnson & Johnson narrowed the range of its full-year sales guidance to between $88 billion and $88.4 billion from the $87.8 billion to $88.6 billion range it projected in January. Adjusted EPS was also narrowed slightly, to a range of $10.57 to $10.72 from $10.55 to $10.75.

Johnson & Johnson stock slipped about 1.7% to $145.07 Tuesday afternoon and is down about 7% so far this year.

-Aaron McDade

AMD Unveils New AI PC Processors as Competition With Nvidia Heats Up

April 16, 2024 02:15 PM EDT

Advanced Micro Devices (AMD) on Tuesday unveiled new processors optimized for artificial intelligence (AI)to expand its AI PC portfolio. The new products could help AMD better compete with Nvidia (NVDA) and Intel (INTC) in the AI era.

AMD announced the AMD Ryzen PRO 8040 Series, which it says are "the most advanced x86 processors built for business laptops and mobile workstations."

The company also unveiled the AMD Ryzen PRO 8000 Series desktop processor, "the first AI-enabled desktop processor for business users, engineered to deliver cutting-edge performance with low power consumption."

Lenovo and HP (HPQ) are set to use the new AMD processors in their AI PC offerings. Microsoft (MSFT) said that the company is working with AMD to "further deliver optimized performance and security features on AMD Ryzen-powered Windows 11 desktops and mobile systems.”

AMD shares were up 2.5% at $164.38 Tuesday afternoon. The stock has gained more than 11% year-to-date.

-Naomi Buchanan

Live Nation Stock Tumbles as Company Reportedly Facing Antitrust Lawsuit

April 16, 2024 01:33 PM EDT

Shares in Ticketmaster parent Live Nation Entertainment (LYV) slid Tuesday after The Wall Street Journal reported that the U.S. Department of Justice is preparing to file an antitrust lawsuit against the company as soon as next month, potentially leading to significant changes to how concert promotions and ticketing are managed.

According to people familiar with the matter, the DOJ will allege that the ticket seller has used its dominance in the marketplace to undermine competition for ticketing live events, though the sources did not provide specific accusations made by the department, the Journal reported.

After completing a triple bottom in late April last year, the Live Nation Entertainment share price has trended mostly higher apart from several pullbacks to the key moving averages. Amid Tuesday's sell-off, investors should closely monitor the $91 level, an area where the price finds a confluence of support from a 12-month uptrend line and the 200-day moving average. A breakdown below this closely watched chart level could see the stock retest lower support around $81.75.

Live Nation shares fell about 7% to trade at $92.82 Tuesday afternoon. The stock is down about 1% so far this year.

-Timothy Smith

Interest Rate Headwinds Could Undercut Bitcoin Halving Benefits

April 16, 2024 12:26 PM EDT

Bitcoin bulls are turning bearish in the lead-up to this weekend’s halving as sticky inflation and rising interest rates threaten to take the wind out of crypto’s sails.

“Our growing concern is that risk assets (stocks and crypto) are teetering on the edge of a significant price correction. The primary trigger is the unexpected and persistent inflation,” wrote Markus Thielen, founder of 10X Research, in a note Tuesday. “We sold all our tech stocks last night (at the open) as the Nasdaq is trading very poorly and reacting to the higher bond yield. We only hold a few high-conviction crypto coins,” he added.

This year’s hotter-than-forecast inflation reports have caused traders to pare back their expectations for interest rate cuts, sending Treasury yields to 2024 highs. Higher yields on Treasurys, which are essentially no-risk investments, draw money away from stocks and other risk assets.

“Given that the halving occurs at a time when dollar liquidity is tighter than usual, it will add propellant to a raging firesale of crypto assets,” wrote Arthur Hayes, co-founder of crypto derivatives trading platform BitMEX, in a newsletter last week.

Morgan Stanley Rises as Earnings Beat Estimates on Investment Banking Gains

April 16, 2024 11:31 AM EDT

Morgan Stanley (MS) significantly exceeded profit expectations in the first quarter on strong investment banking, wealth management, and trading revenue.

The financial firm posted earnings per share (EPS) of $2.02, well above estimates. Revenue rose 4% to $15.14 billion, also above forecasts.

Investment banking revenue gained 16% to $1.45 billion, boosted by a 113% jump in equity underwriting because of increased demand for initial public offerings (IPOs) and follow-ons. Revenue from wealth management ($6.88 billion) and trading ($4.85 billion) rose 5% and 8%, respectively. Assets under management (AUM) added $143 billion to $1.51 trillion.

While the news lifted Morgan Stanley shares nearly 4% Tuesday morning, they were still down about 3% thus far in 2024.

-Bill McColl

Tesla Market Cap Dips Below $500B

April 16, 2024 10:49 AM EDT

Tesla’s (TSLA) market cap dipped below $500 billion for the first time in nearly a year on Tuesday morning as the mass market electric vehicle pioneer’s stock continued to reel from yesterday’s reports it planned to lay off more than 10% of its workforce.

Tesla shares fell as low as $154, just 1% off a 1-year low, early in the session Tuesday, bringing their year-to-date loss to 37%.

The electric vehicle maker has struggled this year with waning demand for electric vehicles, the high cost of which has been amplified by decades-high interest rates. Price-conscious consumers and increased competition from local and Chinese competitors have led Tesla to slash prices several times over the last year in a bid to boost demand.

Tesla earlier this month reported its first year-over-year decline in quarterly deliveries since 2020. Meanwhile, several Chinese rivals including BYD (BYDDY) and Li Auto (LI) grew deliveries in the first quarter amid a price war in the world’s largest EV market.

UnitedHealth Stock Jumps on Earnings Beat in First Quarterly Report Since Cyberattack

April 16, 2024 10:01 AM EDT

UnitedHealth Group (UNH) shares jumped more than 6% in early trading Tuesday after the company reported first-quarter results that surpassed analyst estimates, despite a cyberattack that disrupted some of its operations.

The healthcare giant reported an 8% year-over-year rise in revenue to $99.8 billion, but posted a loss of $1.22 billion in the quarter, largely due to the impact of a cyberattack and a $7 billion charge related to the sale of the company's operations in Brazil, which was announced late last year.

Adjusting for that $7 billion one-time charge and the hundreds of millions related to the company's response to the cyberattack that disrupted some of its operations starting in February, UnitedHealth posted an adjusted profit of $6.43 billion for the quarter or $6.91 per share. Revenue, adjusted net income, and adjusted earnings per share (EPS) all beat analyst estimates compiled by Visible Alpha.

UnitedHealth stock tumbled earlier this year as reports emerged that the company was the subject of a Department of Justice (DOJ) antitrust probe.

UnitedHealth shares were up 6.6% at $475.22 Monday morning but have lost about 10% of their value since the start of the year.

-Aaron McDade

Stocks Making the Biggest Moves Premarket

April 16, 2024 09:14 AM EDT

Gains:

• UnitedHealth Group (UNH): Shares of the healthcare giant surged more than 7% after it reported better-than-expected first-quarter revenue and earnings despite a major cyber attack that disrupted medical billing across the country earlier this year.
• Morgan Stanley (MS): Shares of the bank rose more than 3% after reporting surging investment banking revenue boosted its earnings above analysts’ estimates in the first quarter.
• Trump Media & Technology Group (DJT): Shares of the Truth Social parent company ticked up about 2% after it announced plans to launch a streaming service. The stock has still lost nearly 60% of its value since closing at a post-merger high of $66.22 in late March.
  

Losses:

• Live Nation (LYV): Shares tumbled more than 9% after the Wall Street Journal reported the Justice Department is preparing to file an antitrust lawsuit against the live entertainment production and ticketing company.
• Tesla (TSLA): Shares of the electric vehicle maker fell more than 2%, extending yesterday’s 5% decline following reports the company would lay off more than 10% of staff as it deals with increased competition and weak demand.
• PNC Financial (PNC): Shares of the bank slipped about 2% after reporting a 21% decline in first-quarter profit and forecasting net interest income would decline further in the current quarter.

Stock Futures Rise in Premarket Trading

April 16, 2024 08:32 AM EDT

Futures contracts connected to the Dow Jones Industrial Average were up 0.6% in premarket trading on Tuesday.

S&P 500 futures were 0.2% higher.

Nasdaq 100 futures were little changed about an hour before markets opened.