Tuesday's market moves by the numbers
- Dow closed down 0.48% for its first negative day in four
- This month, Dow is down 3.44%, on pace for its first negative month since March
- This year, Dow is down 3.8%
- S&P closed down 0.48% for its first negative day in four
- This month, S&P is down 4.71%, on pace for its first negative month since March
- This year, S&P is up 3.24%
- Nasdaq Composite closed down 0.29%, for its first negative day in four
- This month, Nasdaq is down 5.86%, on pace for its first negative month since March
- This year, Nasdaq is up 23.55%
- Declining stocks outpaced advancing stocks 1,901 to 1,114 on the NYSE
- Declining stocks outpaced advancing stocks 1,791 to 1,664 or more than 3 to 1 on the Nasdaq — Gina Francolla, Maggie Fitzgerald
Stocks fall but close off their lows, Dow down more than 100 points
Stocks slipped on Tuesday, but closed off their lows of the session. The Dow Jones Industrial Average fell 132 points, after being down nearly 250 points earlier in the day. The S&P 500 closed down 0.48%. The Nasdaq Composite closed down 0.29%. — Maggie Fitzgerald
Fed's Williams cites positive economic news but sees low inflation and low rates ahead
New York Fed President John Williams sees the U.S. economy getting back to full strength in about three years while both inflation and interest rates remain low. "Overall, despite all the challenges, I'm pretty optimistic the economy's on a reasonably good trajectory," Williams said Tuesday afternoon on a day where he made three appearances. Despite a raft of upbeat economic data, he also said he expects "very low inflation for the foreseeable future," a condition that will keep the Fed accommodative for an indefinite period.
Central bank officials earlier this month committed to a flexible average inflation targeting strategy that will allow inflation to run above the traditional 2% target for a period of time, though it is currently well below that level due to structural challenges like an aging population and low productivity. "We need to be more proactive, if you will, to make sure that we're getting the balance on that upside, to make sure in the end that we're not treating 2% as a ceiling," he told reporters. Williams said there's no timetable for when the Fed might come off its current monetary stance, in which short-term benchmark rates are anchored near zero. "I don't know how long it will take," he said. "The economy has been surprising us on the upside for the past couple of months. If that continues, that would be great. I don't think it's how long we're at low rates, it's about what we can do to get the economy back to full strength." — Jeff Cox
Analyst says she's closely monitoring Biden's stance on filibuster during debate
Stefanie Miller, managing director for FiscalNote Markets, told CNBC she will closely be watching whether Democratic nominee Joe Biden endorses ending the Senate filibuster during tonight's presidential debate.
Ditching the 60-vote threshold in the upper chamber is a stance increasingly held by those on the left wing of the Democratic Party. But Biden, who represented Delaware in the Senate for nearly four decades, has long been supportive of leaving the legislative filibuster in place. In July, he said his willingness to end it is "going to depend on how obstreperous [Republicans] become."
"If you remove this legislative filibuster, then you only need 51 senators, a simple majority of senators, to pass policy, which means every two to four years, we could have really big policy changes," Miller said on "Power Lunch."
And by extension, she said, that would have big implications for Wall Street.
"Both sides will capitalize on it. If it goes away, it just won't matter who is in the majority, policies will swing back and forth, which I think would be a nightmare for the market," Miller said. - Kevin Stankiewicz
Final hour of trading: Stocks off their lows
The major averages recovered most of their earlier losses heading into the final hour, but the Dow and S&P 500 were still headed for their first drop in four days. The 30-stock Dow was down 58 points, or 0.2%. The S&P 500 also dipped 0.2%. The Nasdaq Composite hovered around the flatline. —Fred Imbert
Fed's Kaplan stresses need to remain 'flexible' on future policy
Dallas Fed President Robert Kaplan explained his vote against the central bank's new inflation approach, saying Tuesday he believes future officials should have flexibility in determining monetary policy. In an essay the voting member of the Federal Open Market Committee released, he said that policy should remain accommodative, likely until late 2022 or 2023, but that doesn't mean that short-term interest rates need to stay around zero. "Beyond that point, I believe that the Committee should retain greater policy rate flexibility to decide on the appropriate stance of monetary policy," Kaplan wrote. He added that he expects future FOMC members will want to keep policy loose as the economy tries to get back to full employment and strong growth, "but will they want to be effectively increasing the level of accommodation by keeping the federal funds rate at zero?" He added that he also is skeptical about the benefits of strengthening the guidance the Fed provides on when it will raise rates again because rates are low and likely to stay that way "for the next few years." — Jeff Cox
Stocks making the biggest moves midday
- JPMorgan — The the bank's stock ticked 1% lower on news JPMorgan is set to pay $920 million to resolve probes from three government agencies over its role in the alleged manipulation of metal and Treasury markets.
- Carnival, Norwegian Cruise Line, Royal Caribbean — Major cruise operators fell on fears about Covid-19 heading into the fall season. Shares of Carnival fell 2.2%. Shares of Norwegian Cruise Line and Royal Caribbean dropped 0.8% and 2.8%, respectively.
- Fitbit – Shares of Fitbit popped more than 6% after Reuters reported that Google is set to win EU antitrust approval for its $2.1 billion purchase of the fitness tracker maker.
Read more about midday movers here. — Maggie Fitzgerald
Markets at midday: Stocks fall for the first time in four sessions, Dow off by 200 points
The major averages were broadly lower around midday Tuesday as traders took profits following three straight daily gains. Concerns over a resurgence in coronavirus cases in New York City also pressured the broader market. The Dow slid more than 200 points, or 0.8%. The S&P 500 slid 0.5% and the Nasdaq Composite pulled back by 0.3%. —Fred Imbert
Treasury yields lower as quarter winds down, traders watch virus
Treasury yields are following the path of the stock market and moved just slightly lower after a report of a worsening Covid-19 outbreak in New York.
Yields move opposite price, and the 10-year yield was at its low of the day after New York City Mayor Bill de Blasio said the rate of positive coronavirus tests is more than 3% for the first time in months. The 10-year was at 0.64%.
"The reality is only two things matter for the next few weeks. It's the presidential election and the second Covid wave. An uptick in what used to be the global epicenter of the virus is certainly a concern," said Jon Hill, senior fixed income strategist at BMO. But the fact yields moved just slightly suggests concerns about the virus spreading are priced in.
"The resistance level we're closely watching is 0.60% and that coincides with the low of Sept. 3 and the bottom of the current range," he said.
The Treasury market has also been supported by buying for month end and quarter end portfolio adjustments.
Airlines lead declines
Shares of major airlines were among the biggest losers on Tuesday, weighing down the broader market. American Airlines and United Airlines both fell nearly 4%, while Delta dipped more than 2%. The move follows an uptick of coronavirus cases in New York. These stocks all rallied in the previous session.— Yun Li
Gaming stocks fall amid reports of positive tests in NFL
Several new Covid-19 cases among players and staff for the NFL's Tennessee Titans has led the team to shut down its facilities, according to ESPN. Sports gaming stocks DraftKings and Penn National dipped following the news. Shares of DraftKings are up about 0.9% but had a gain of 4.5% earlier in the session. Penn National extended its losses and has now fallen more than 5%. — Jesse Pound
Consumer confidence jumps in September
U.S. consumer confidence jumped unexpectedly in September as consumers' short-term outlook for income, business, and labor market conditions improved. The Conference Board said Tuesday its consumer confidence index increased to a reading of 101.8 this month from 86.3 in August. The reading is much higher than a Dow Jones estimate of 90.1.— Yun Li
Beyond Meat jumps on Walmart deal expansion
"This fall, Walmart plans to triple availability of the Beyond Burger from approximately 800 locations to more than 2,400 stores nationwide beginning next week," Beyond Meat said in a statement. Walmart has offered Beyond Meat products since 2015.
Shares of the alternative meat maker have surged 117% this year. - Pippa Stevens
Stocks open flat
Major U.S. equity benchmarks were flat at Tuesday's open after a strong rally in the previous session. The Dow Jones Industrial Average dipped 30 points, while the S&P 500 and the Nasdaq Composite both fell less than 0.1%. The Dow jumped more than 400 points on Monday. — Yun Li
Here are Tuesday’s biggest analyst calls of the day: Alphabet, RH, Hershey & more
- Berenberg initiated Bristol-Myers as buy.
- Argus upgraded Darden to buy from hold.
- Cowen upgraded RH to outperform from market perform.
- BMO upgraded Hershey to outperform from market perform.
- Bank of America upgraded Extended Stay to buy from neutral.
- MoffettNathanson raised its price target on Alphabet to $1,850 from $1,650.
Pro Subscribers can read more here. - Michael Bloom
LVMH countersues Tiffany
LVMH filed a countersuit against Tiffany on Monday, arguing that it was luxury jeweler's financial mismanagement during the pandemic that led to it walking away from its proposed $16 billion takeover.
The suit, filed Monday in Delaware, says that LVMH "continues to have full confidence in its position that the conditions necessary to close the acquisition of Tiffany have not been met." It adds that the "spurious arguments put forward by Tiffany are completely unfounded."
The Louis Vuitton owner scrapped the deal in early September, citing the threat of U.S. tariffs on French goods and Tiffany's request to extend the deal deadline to the end of the year. Tiffany immediately filed a lawsuit seeking to enforce the agreement. Shares of Tiffany dipped about 0.6% in premarket trading on Tuesday. — Yun Li
Nio could be the 'next iconic auto brand,' says Deutsche Bank
Deutsche Bank reiterated its buy rating on shares of Nio on Tuesday, saying the electric vehicle company could be the "next iconic auto brand." The stock has gained 367% this year, and Deutsche Bank believes there's another 27% upside ahead. Nio was slightly lower during premarket trading.
Big Lots jumps 7% after upbeat guidance
Shares of Big Lots jumped more than 7% in premarket trading on Tuesday after the big-box retailer provided a better-than-expected earnings forecast. The company said it expects its third quarter comparable sales to increase to mid-teens, while its earnings per share will be in the range of $0.50 to $0.70. A Refinitiv estimate puts Big Lots' third-quarter EPS at only $0.21.— Yun Li
IHS Markit rises on strong earnings
Shares of IHS Markit rose nearly 2% in premarket trading after the company reported better-than-expected earnings before the bell on Tuesday. The information provider earned 77 cents per share, higher than the 69 cents per share expected on Wall Street, according to Refinitiv. IHS Markit's revenue came in in line with expectations at $1.07 billion. Shares of the stock are up about 6% in 2020. — Maggie Fitzgerald
Important presidential debate Tuesday night
President Donald Trump and Democratic nominee Joe Biden are set to square off in a face-to-face debate for the first time Tuesday night at 9 pm ET in Ohio. While Trump has incumbent advantage, former vice president Biden has a steady lead in the national polls. The candidates are expected to debate issues about the Supreme Court, the economy and the coronavirus pandemic.
Investors largely consider Trump to be better for the market and the economy; however, his volatile relationship with China is considered problematic by some on Wall Street. Analysts largely expect Biden to raise corporate taxes and tighten regulation.
The face-off is expected to last 90 minutes, without commercial breaks. CNBC.com will livestream the debate, and it will also be carried on channels including NBC, MSNBC, C-SPAN, CNN, Fox News, CBS and ABC. Two more debates between Trump and Biden are on the schedule before Election Day.— Maggie Fitzgerald, Kevin Breuninger
Democrats unveil $2.2 trillion stimulus package
Stimulus talks are set to continue on Tuesday following the Democrats' new $2.2 trillion aid package. While smaller than the $3.4 trillion initially proposed, the new package is still significantly ahead of what Republican leaders have said they would agree to.
House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are expected to speak again on Tuesday, after holding discussions on both Sunday and Monday.
Read more on what's in the new $2.2 trillion Covid-19 relief bill here. —Pippa Stevens
Hershey has a 'future built more on treats than tricks,' BMO says
An analyst at BMO Capital Markets upgraded Hershey to outperform from market perform, noting that concerns over a potentially slow Halloween season are "likely overstated." The analyst also hiked his price target on the stock to $163 per share from $150 per share, implying an upside of 16% over the next 12 months.
"First, albeit early, the early acceleration of Halloween sales suggests management's guidance on Halloween could be conservative," said analyst Kenneth Zaslow in a note. "HSY's seasonal candy increased more than 70%."
"Second, HSY is positioned to navigate Halloween, as it leverages its data analytics, pivoted its packaging, and selectively added capacity," Zaslow added. "Third, seasonal sales for Easter, which exceeded expectations, may serve as a proxy for the relative strength of Halloween."
He also said the company would still be in a solid position for the long haul even if Halloween fell short of expectations, noting Hershey has "a future built more on treats than tricks."
Hershey shares are down more than 4% year to date but have popped 10% over the past three months. —Fred Imbert
Two women file sexual abuse complaints against Nikola founder Trevor Milton
Two women have come forward with formal sexual assault allegations against Nikola founder Trevor Milton, accusing the 38-year-old billionaire in complaints filed with Utah authorities of sexual abuse when both women were 15 years old.
The accusations, stretching back more than 15 years ago, follow Milton's resignation as executive chairman of Nikola on Sept. 21 after short seller Hindenburg Research released a damning report detailing fraud allegations. The report has reportedly sparked inquiries into Milton and Nikola by the Securities and Exchange Commission and Department of Justice.
Since the Hindenburg report dropped a little over two weeks ago, the shareholder lawsuits and personal attacks on social media have started to pour in.
Read more here. — Dawn Kopecki, Michael Wayland
Cowen upgrades RH, shares rise
Shares of RH rose nearly 2% in the premarket after a Cowen analyst upgraded them to outperform from market perform. The analyst also hiked his price target on the stock to $435 per share from $370 per share, implying an upside of 20.5% over the next 12 months.
"We believe RH is in the earlier innings of a multi-year transformation which further benefits from secular tailwinds as affluent shoppers increase investments in their homes," said analyst Max Rakhlenko in a note. "We are constructive on RH's accelerated results as revenue- and margin-enhancing drivers yield above-expectation growth, and we see upside to long-term +15% to +20% net income targets."
RH shares have rallied nearly 70% this year and have more than doubled over the past year. —Fred Imbert, Michael Bloom
Stock futures are flat as Wall Street takes a breather following back-to-back rallies
U.S. stock futures pointed to a muted session on Tuesday following consecutive rallies that helped the market claw back some of its losses for the month. Dow Jones Industrial Average futures were down just 33 points, or 0.1%. S&P 500 futures also dipped 0.1% while Nasdaq 100 futures slid 0.2%. Wall Street was coming off a strong session, with the major averages all surging more than 1% on Monday. Those gains built on another solid performance on Friday. On Tuesday, however, investors are bracing for the first presidential debate between President Donald Trump and Democratic nominee Joe Biden. Some Wall Street analysts believe the first debate of this cycle could be more consequential for the markets than most debates, with a clear victory by one candidate possibly creating significant market moves. —Fred Imbert