Virgin Galactic stock dips after reporting another quarterly loss, new share offering
Shares of the space tourism stock slipped 7% in after-hours trading after Virgin Galactic reported an adjusted EBITDA loss of $54 million for the second quarter. Additionally, Virgin Galactic announced plans to raise about $460 million in a sale of common stock. But the company offered a significant update to its development timeline, saying its next test spaceflight will occur "this fall." If the company's two upcoming tests go smoothly, Virgin Galactic expects to fly founder Richard Branson in the first quarter of 2021. — Michael Sheetz
Monday's session by the numbers
- The Dow gained 236 points, 0.89%, its third positive session in four
- Microsoft had the most positive impact on the Dow, adding 79 points to the index, and also on the S&P 500
- The Dow is 9.82% below its record high
- The S&P 500 gained 0.72%, its third positive session in four
- Six of 11 S&P sectors were negative in Monday's session, led to the downside by real estate, down 1.47%. Tech was the best performer, up 2.49%.
- The S&P 500 closed 2.91% below its record high
- The Nasdaq Composite gained 1.47%, its fourth positive session in a row
- The Nasdaq hit a fresh all-time high and record close
- The Russell 2000 gained 1.78%, breaking a 2-day losing streak. — Christopher Hayes
BlackRock's Rieder not worried about 'shock impact' of weaker dollar
BlackRock Fixed Income CIO Rick Rieder said Monday that he expects a relatively weak U.S. dollar to continue in the near-term while there is major fiscal and monetary stimulus to help support the economy during the pandemic.
"I think everything that's happening, whether it's fiscal or monetary, is healthy for the system, but does it mean the dollar can come under some moderate pressure? I think so," Rieder said on "Closing Bell."
However, he isn't telling investors to fret about the shift. Rieder said that risk assets tend to perform well in a weaker dollar environment, and that the relative change in currency strength could be helpful to foreign companies that have dollar-denominated debt.
"I do think there'll be persistence, but I'm not worried about a shock impact to the dollar." — Jesse Pound
Market moves higher on first day of August
Tech stocks led the way on Monday as all three major indexes rose to start the month. The Nasdaq rose 1.5%, while the Dow and S&P 500 gained 0.9% and 0.7%, respectively. — Jesse Pound
Nikola spikes ahead of earnings
Shares of Nikola jumped 21% during Monday's session, ahead of the company's quarterly earnings release on Tuesday after the market closes. It will be the first quarterly report for the electric vehicle company, which went public through a reverse merger with special purpose acquisition company VectoIQ in June.
This is the 'honey badger market,' portfolio manager says
Tom Martin of GLOBALT called this the "honey badger market" as it remains unphased even amid massive uncertainty over the coronavirus pandemic and the economic recovery from the outbreak. "It just doesn't care about anything," said Martin, a senior portfolio manager at the firm. "It just keeps going up. Coronavirus? The market says 'whatever.' A fiscal cliff is coming? 'Sure, no problem' … That's what you're seeing in the stock market both here and abroad." The S&P 500 has surged more than 50% since hitting an intraday low on March 23. —Fred Imbert
Final hour of trading: Tech leads stocks higher to start the new month
Stocks rose sharply on Monday, the first trading day of the new month, as shares of major tech companies such as Microsoft, Apple and Netflix outperformed. The Dow was up 260 points, or 1%, with roughly one hour left in the session. The S&P 500 gained 0.9% and the Nasdaq Composite traded up 1.6%, hitting an all-time high. —Fred Imbert
Kodak shares down more than 70% from Wednesday's high
Volatile trading continued in shares of Eastman Kodak on Monday, with the stock dropping more than 26%. A $765 million funding announcement from the U.S. government last Tuesday kicked off a frenzy of trading in the stock, sending shares from around $2 to $60 in the span of just three days. Since then, however, some of the enthusiasm has cooled. The stock last traded around $15.86 per share, or about 73% below its Wednesday high. — Pippa Stevens
Here are some of the biggest stock movers midday
- Nio — The U.S.-listed shares of the China-based electric car maker jumped after the company said its July deliveries surged by 322%.
- DuPont — DuPont was downgraded by Stephens to equal weight from overweight, with the analyst noting: "With the economy in the tank, innovation is harder to monetize, which is pushing back recovery further."
- ADT — Shares of the home security company surged after announcing a partnership with Google. As part of the partnership, Google will take a 6.6% stake in ADT.
Click here to read more. — Fred Imbert
Markets at midday: Stocks rally to start August
Stocks rose sharply on the first trading day of August, led by gains in Microsoft and Apple. The Dow traded 246 points higher, or 0.9%. The S&P 500 climbed 0.8% and the Nasdaq Composite jumped 1.5%. — Fred Imbert
The deal market is 'definitely heating up again,' says M&A powerbroker Ken Moelis
Investment banker Ken Moelis told CNBC that the market for mergers and acquisitions is beginning to pick up after the coronavirus pandemic cooled it. "We saw it six, seven weeks ago. Quality assets, people were ready to buy," the founder and CEO of Moelis & Company said on "Squawk on the Street."
Moelis' comments follow Marathon Petroleum's deal to sell its Speedway gas stations to the Japanese parent company of 7-Eleven, as well as Microsoft's potential deal to acquire the U.S. operations of TikTok, the popular social-media app owned by Chinese tech firm ByteDance. A deal between Marathon and Seven & i Holdings for Speedway reportedly was scuttled earlier this year, in part due to the intensifying Covid-19 pandemic.
"I think there is a desire to look over the immediacy of what's going on today and if you're in the market and you want to buy something that you think is a decade-long or a permanent asset, you're willing to look through the next six, seven, eight months, year," Moelis said. "M&A is definitely heating up again." — Kevin Stankiewicz
U.S. manufacturing activity expands at faster-than-expected pace
The Institute for Supply Management's (ISM) manufacturing PMI came in at 54.2 for July, indicating a faster-than-expected expansion for the sector. Economists polled by Dow Jones expected a print of 53.8 for last month. "This figure indicates expansion in the overall economy for the third month in a row after a contraction in April, which ended a period of 131 consecutive months of growth," Timothy Fiore, ISM chair, said in a statement. The expansion was driven in part by a sharp increase in new orders and a rise in production, ISM said. —Fred Imbert
Apple market cap approaching $2 trillion
Apple's post-earnings surge continued on Monday morning, bringing the company's market cap to above $1.92 trillion. The stock jumped 4.4% in early trading, following a 10.5% bounce on Friday. The tech giant announced better-expected-earnings and a four-for-one stock split on Thursday. — Jesse Pound
Goldman Sachs says investors should be careful with the SPAC market
Goldman Sachs urged caution for investors wanting to cash in on this year's boom in the so-called blank check companies. It's been a mania in SPACs, or special purpose acquisition companies, as businesses shy away from the traditional initial public offering market roiled by the coronavirus pandemic and wild volatility. So far in 2020, there have been 51 SPAC offerings, raising a record $21.5 billion, up 145% from the same period a year ago, according to Goldman. The bank analyzed 56 SPACs that completed translations since the beginning of 2018 and found that in the long run, they tend to underperform the broader market and returns are all over the place. — Yun Li
DiamondPeak Holdings jumps on EV deal
Special purpose acquisition company DiamondPeak Holdings is merging with electric vehicle start-up Lordstown Motors. The deal is the latest between an EV company and a SPAC as investor enthusiasm for each continues to grow. The deal, which is expected to close in the fourth quarter, will see the combined company trade on the Nasdaq under the new ticker "RIDE." Shares of DiamondPeak gained more than 11% during early trading on Monday. - Pippa Stevens
Nasdaq hits record high
The Nasdaq Composite set a new intraday record high, pushed higher by Apple and Microsoft which have both gained more than 4%. The index has gained 1.2% so far on Monday. — Jesse Pound
Stocks climb at the open
The major indexes opened the first trading day of August in positive territory, with large tech stocks leading the way. The Nasdaq Composite rose 0.8% in early trading, while the S&P 500 and Dow gained 0.5% and 0.4%, respectively. — Jesse Pound
Eli Lilly launches Covid-19 trial focused on nursing homes
Eli Lilly announced that it has launched a phase three trial for an experimental Covid-19 preventative treatment focused on nursing home residents and staff members. Long-term care facilities have been the site of some of the worst outbreaks for the disease, which has a higher death rate among older patients. The company's stock rose more than 2% in premarket trading. — Jesse Pound
ADT jumps after Google announces minority stake
Shares of home security company ADT surged more than 60% after the company announced a partnership with Google that would make the tech giant and minority owner in the company. The partnership involves integrating Google's Nest product into ADT. As part of the deal, Google will invest $450 million in ADT. — Jesse Pound
Here are Monday's biggest analyst calls of the day: Nikola, Merck, Yum! Brands, Tesla & more
- UBS upgraded Pinterest to buy from neutral.
- Bernstein upgraded Qualcomm to outperform from market perform.
- Deutsche Bank upgraded Yum! Brands to buy from hold.
- Goldman Sachs upgraded Merck to buy from neutral.
- Stephens downgraded DuPont to equal weight from overweight.
- Susquehanna upgraded Under Armour to neutral from negative.
- BTIG upgraded Expedia to buy from neutral.
- Deutsche Bank added a catalyst call buy idea on Nikola.
Pro subscribers read more here. — Michael Bloom
Virgin Galactic partnering with Rolls-Royce, unveils supersonic aircraft design
Shares of Virgin Galactic rose more than 3% in premarket trading after the space tourism venture announced that it signed an agreement with British aerospace giant Rolls-Royce toward developing Virgin Galactic's planned supersonic aircraft. The company completed a concept review alongside NASA and will now work with the FAA to develop a framework for certifying the aircraft for flight. Notably, Boeing's venture arm had previously invested $20 million in Virgin Galactic to help the company build a supersonic aircraft. — Michael Sheetz
Microsoft confirms talks to buy TikTok in U.S., aims to conclude by Sept. 15
Microsoft confirmed on Sunday it has held talks with Chinese technology company ByteDance to acquire its trendy social app TikTok in the U.S. The tech giant said it will keep working with the U.S. government on a deal and it aims to wrap the deal by September 15. Microsoft might offer other American investors get involved in the acquisition, the company said in a statement, adding that its CEO, Satya Nadella, has spoken with President Donald Trump. The company did not disclose deal terms. — Yun Li
Tech lifts futures higher
U.S. stock futures rose on Monday morning as investors looked for clarity from Washington on another round of coronavirus relief. The market was lifted by major tech stocks, with Apple climbing 1.5% and Amazon rising 0.7%. The moves follow a week of blowout earnings for major tech stocks and a July that saw the S&P 500 jump 5.5%. — Jesse Pound
Reopening trades tick lower premarket
Shares of companies that hinge on the reopening of the U.S. economy ticked lower in premarket trading on Monday. The nation's major airlines were all lower, with American Airlines down more than 1%. Cruiselines also lost some ground with Carnival dropping more than 4%, Norwegian Cruise Line falling 3.6% and Royal Caribbean Cruises dipping 2.5%. Wynn Resorts lost about 0.8% in premarket trading. —Maggie Fitzgerald
Clorox beats earnings, names new CEO
The cleaning products company beat Wall Street expectations for its fiscal fourth quarter and announced that its president Linda Rendle will become CEO in September. Net sales increased 22% year-over-year for the quarter as the health crisis spurred demand. Clorox reported $2.41 of earnings per share and $1.98 billion of revenue, which was 42 cents per share and $110 million above expectations, according to Refinitiv. Shares climbed 0.4% in premaket trading. — Jesse Pound
Wrangling continues over unemployment assistance
Congress and the White House remain deadlocked over unemployment insurance benefits, with talks likely again Monday. House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin set out their respective positions in dueling media appearances over the weekend. The main sticking point remains how much compensation those displaced by the coronavirus pandemic should receive, as benefits that provided $600 a week over normal compensation expired Friday. The White House wants an extra $200 a week while Democrats favor retaining the previous amount. "They have a $200 proposal, which does not meet the needs of America's working families, and it's a condescension, quite frankly," Pelosi said on ABC's "This Week." "There's obviously a need to support workers, support the economy," Mnuchin said later on the same program. "On the other hand, we have to be careful about not piling on enormous amounts of debt." Both sides agree on sending out $1,200 checks. — Jeff Cox