The S&P 500 advanced modestly on Tuesday to its highest close since 2023 began as Wall Street digested a recent rally that led the broad index to its highest level in nine months.
The S&P 500 added 0.24%, trading near a nine-month high, to finish at 4,283.85. It was also the highest close for the broad-market index dating back to August 2022. The Nasdaq Composite climbed 0.36% to end at 13,276.42 — also a closing high in 2023. The Dow Jones Industrial Average eked out a narrow gain of 0.03%, or 10.42 points, to close at 33,573.28, as losses of more than 2% in Merck and UnitedHealth weighed on the blue-chip average.
Coinbase dropped more than 12% after the Securities and Exchange Commission sued the crypto company. The SEC alleged Coinbase was acting as an unregistered broker and exchange. Bitcoin rose more than 6%, according to CoinMetrics.
Apple shares shed 0.2% a day after the tech giant debuted its highly anticipated virtual reality headset as well as new software at its annual Worldwide Developer Conference. In the previous session, the stock hit an all-time high ahead of the announcement.
Markets may avoid big swings as investors ready for next week's Federal Reserve policy meeting, said Jeff Kilburg, CEO of KKM Financial. Still, he said it's worth noting that the market has stayed above the range seen in recent months.
"It really seems like we're kind of in a holding pattern," he said. "With the Fed next week, people are kind of taking a breath."
The major indexes finished Tuesday's session higher.
The S&P 500 added 0.24%, while the Nasdaq Composite climbed 0.36%. The Dow eked out a narrow 0.03% gain.
— Alex Harring
Don't expect the Fed to ease monetary policy anytime soon, Wolfe Research's Chris Senyek said.
"While the FOMC has hiked sharply in this cycle, overall financial conditions have modestly loosened this year due to the Fed's balance sheet expansion in response to the regional banking mini-crisis, and Fed Chair Powell's reluctance to aggressively 'talk down' rate cut expectations," the firm's strategist said.
"Our view that sticky inflation will ultimately force the Fed to be 'higher for longer' is at the core of our bearish outlook," he added. "While our base case hasn't changed, the Fed taking appropriate actions to set inflation on a sustainably lower path certainly isn't guaranteed."
— Fred Imbert, Michael Bloom
Bank of America clients were net sellers of stocks last week for the first time in three weeks, with outflows being led by tech and materials, the bank's Jill Carey Hall said in a note.
"Tech has still seen the biggest cumulative inflows YTD, but outflows from Tech last week were the largest in a year (led by institutional and retail selling)," Hall said.
Overall, $532 million in equities were sold in the week of May 29. Outflows in tech exceeded $1.1 billion, while materials lost $425 million.
The tech sector has been on a tear this year, rallying more than 30%. Materials, meanwhile, are the best performers in the S&P 500 this month, up nearly 5%.
— Fred Imbert, Michael Bloom
BMO Capital Markets lifted its price target in the S&P 500 to 4,550 as the "all the doom and gloom" investors have been bracing for fails to "come to fruition."
"In other words, we believe the anticipated recipe for disaster is simply not present," wrote chief investment strategist Brian Belski in a note to clients. "So, from our perspective, all the worries that damaged 2022 market performance are slowly beginning to subside."
Read more on the call from BMO here.
— Samantha Subin
Stocks were mixed as the final hour of Tuesday's trading session kicked off.
The Dow was down 0.1%. The S&P 500 and Nasdaq Composite added 0.1% and 0.3%, respectively.
— Alex Harring
Following Apple's mixed reality headset debut, CNBC looked at what tends to happen to the tech giant's stock price following a release.
It turns out that Apple shares have risen the day after the WWDC event every time since 2016.
— Ganesh Rao
Despite some concerns on Wall Street, Piper Sandler expects an attractive setup for shares of Advanced Micro Devices in the second half of 2023.
"Overall, we view the demand setup positively going into the back half of the year for AMD" wrote analyst Harsh Kumar in a Tuesday note to clients. "We are expecting overall 3Q growth to be strong driven by a significant uptick in data center sales from AI related applications."
Kumar upped the firm's price target on the shares to $150 from $110, reflecting 27% upside from Monday's close. The stock's surged more than 91% in 2023 as investors bet on artificial intelligence.
He anticipates the launch of AI-focused MI300 chip to potentially contribute $200 million to data center revenues in the fourth quarter, and views concerns of subpar third-quarter revenue growth as overdone.
— Samantha Subin
Shares of Boeing fell more than 2% after the aircraft maker warned of a new defect on its 787 Dreamliner model.
"We are inspecting 787s in our inventory for a nonconforming condition related to a fitting on the horizontal stabilizer," Boeing said in a statement. "Airplanes found to have a nonconforming condition will be reworked prior to ticket and delivery."
The production flaw could potentially affect deliveries of its wide-body aircraft.
— Leslie Josephs, Samantha Subin
Higher rates and overhangs from this year's banking crisis will drastically slow economic growth for the biggest global economies, the World Bank said Tuesday.
The institution said advanced economies — the U.S., Japan and Euro area countries — are expected to grow by only 0.7% in 2023, down from 2.6% in 2022.
The U.S. is projected to grow 1.1%, while the Euro area and Japan are projected to see GDP growth of less than 1% in 2023. U.S. GDP growth is expected to decelerate in 2024 to 0.8% as high interest rates further weigh on growth.
The bank estimates overall global growth will decelerate to 2.1% in 2023, down from 3.1% in 2022. Emerging and developing economies are forecasted to see a slight uptick in GDP to 4%, up 0.6% from the bank's projections made in January 2023. However, World Bank chief economist Indermit Gill said excluding China, growth in developing economies would be less than 3%.
Read more about the report here.
— Hakyung Kim
RBC Capital Markets thinks Vale will benefit from higher sentiment around iron ore despite slightly lower material costs.
The firm upgraded the iron ore and nickel producer stock to outperform on Tuesday, while its price target implies about 10% upside from Monday's $13.61 close.
"Although there could remain scope for VALE's earnings to deteriorate if it is unable to restore volumes to capacity levels owing to weak demand, especially in the short term, higher iron ore prices and positive expectations on stimulus should allow for shares to bounce," analyst Tyler Broda said. "As the steelmakers continue to accelerate their decarbonization plans, VALE's pellet, DRI and high grade inputs, we think, are likely to hold pricing better than lower quality production at peers."
— Brian Evans
Golf-related stocks were trading higher on Tuesday, as investors digested the news that the PGA Tour is merging with Saudi-backed LIV Golf.
Shares of Topgolf Callaway Brands Corp. climbed by more than 5%, and Titleist parent Acushnet Holdings jumped 4.1%.
While the terms of the merger were not disclosed, CNBC's David Faber reported Tuesday that the Saudi Public Investment Fund was prepared to invest billions into the combined golf league. That may be leading some investors to bet that growing interest in golf could accelerate in the years ahead.
"The infusion of capital from PIF signifies a strong commitment to the growth and promotion of golf on a global scale. This injection of funds will enable the newly formed company to embark on ambitious initiatives aimed at expanding the reach of golf and cultivating a broader fan base," Jefferies analyst Randal Konik said in a note to clients.
— Jesse Pound
While the major market indexes have been mostly calm on Tuesday, several individual stocks are seeing double-digit moves.
Coinbase — Shares of the crypto exchange fell more than 13% after the Securities and Exchange Commission sued Coinbase on Tuesday. The regulator alleged that the company was operating as an unregistered exchange and broker. Coinbase said it would continue to operate its business as usual during the litigation.
GitLab — The software stock surged more than 30%. The action comes a day after GitLab posted a smaller-than-expected loss for the first quarter of fiscal 2024. Gitlab reported a 6-cent loss per share, better than the 14-cent loss per share the consensus anticipated, according to Refinitiv.
Thor Industries — Shares of the recreational vehicle company jumped 16% after Thor Industries reported a better-than-expected fiscal third quarter. Thor reported earnings of $2.24 per diluted share, while analysts surveyed by FactSet were expecting $1.07 per share. The company also raised the lower end of its full-year earnings guidance
Check out more movers here.
— Jesse Pound
Atlantic Equities thinks FedEx can narrow its discount trading gap with peer UPS.
The firm initiated coverage of the shipping giant on Tuesday with a buy rating.
"FedEx through its cost reduction programs, is shifting to a flexible, margin enhancing, ground focused integrated network. We believe this will narrow the margin and valuation disparity to UPS," analyst Oliver Holmes wrote.
CNBC Pro subscribers can read the full story here.
— Brian Evans
Financial stocks pulled the S&P 500 into positive territory.
The sector gained 1.1%, while the broad index added just 0.1%. Zions Bancorporation and Comerica led the sector up, with each gaining more than 6%.
In all, eight of the 11 S&P 500 sectors traded up in Tuesday's session. Health care, consumer staples and information technology were the three down in the session.
— Alex Harring
The Cboe Volatility Index, known as the VIX and the Wall Street's fear gauge, hit a low of 14.32 Tuesday, reaching its lowest level since July 2021 on an intraday basis. The VIX closed below 15 on Friday, the first close below that threshold since February 2020.
The VIX, which tracks the 30-day implied volatility of the S&P 500, has dipped nearly 4 points in June after gaining over 13 points in May. The index looks at prices of options on the S&P 500 to track the level of fear on Wall Street.
— Yun Li
The SPDR S&P Regional Banking ETF gained more than 4% during morning trading, putting it on pace for its third positive day in four.
The fund is also on track to close well above its 50-day moving average for the third consecutive day.
Some of the biggest gainers include PacWest, Independent Bank, BankUnited and Western Alliance, all up at least 6% or more.
— Gina Francolla, Samantha Subin
Daily notices from Wall Street note the narrowness of this year's stock market rally, but Strategas Research says there are pockets of strength beyond the usual suspects, if you use a strong enough magnifying glass.
"In a market where it's been very difficult to find any sustained leadership outside of the
Technology/Semi/AI category, the Construction Materials group remains a continued source of strength," wrote Chris Verrone, head of technical and macro research.
Although the four biggest stocks — Vulcan Materials, Martin Marietta Materials, Eagle Materials and Summit Materials — only have a combined market value of some $65 billion, "all remain in clear absolute + relative uptrends."
The strength in construction materials is part of what Strategas sees as industrial stocks' "steady source of leadership in our work all year domestically, in Europe, and most potently in Japan." Eagle Materials has climbed 25% so far this year, Martin Marietta is ahead 24% in 2023, Summit has risen 18% and Vulcan by 16%. Pretty good for crushing rocks.
— Scott Schnipper, Michael Bloom
The Dow slid about 50 points, or 0.2%. The S&P 500 pulled back 0.2% and the Nasdaq fell 0.4%.
— Fred Imbert
Here are some of the names making the biggest moves in the premarket:
To see more stocks making premarket moves, read the full story here.
— Michelle Fox