Stocks closed near the flat line Monday as investors geared up for the Federal Reserve's meeting scheduled for later in the week.
The S&P 500 inched higher by 0.07% to 4,453.53, while the Nasdaq Composite added 0.01% to finish at 13,710.24. The Dow Jones Industrial Average advanced 6.06 points, or 0.02%, to end at 34,624.30.
The Fed's two-day policy meeting begins Tuesday. Traders are assigning a 99% chance that the central bank stays put when it releases its rate decision on Wednesday, according to the CME Group's FedWatch tool, which gauges pricing in the fed funds futures market. The central bank will also release its market forecasts on Wednesday.
There's less agreement about what the Fed will do in November, with the market expecting an approximately 31% probability of a hike. Goldman Sachs' economists said over the weekend that an increase in November would be unlikely.
"There are some question marks: Everyone knows that they're going to stay put for this meeting, but then what is their messaging going to be going forward?," said Stephanie Lang, CIO at Homrich Berg. "It's a wait-and-see moment to see what kind of forward guidance we're getting from the Fed."
Apple climbed 1.7%. Goldman Sachs and Morgan Stanley both gave optimistic outlooks for new iPhone demand.
Meanwhile, Ford slid more than 2% as the United Auto Workers' strike continued. Stellantis and General Motors, the other automakers facing off with the union, each shed more than 1%.
The S&P 500 and the Nasdaq both ended the previous trading week down, marking their second straight week of losses. The Dow finished the week 0.1% higher.
The three major indexes ended Monday's session with muted moves.
The Dow and Nasdaq Composite finished around flat, while the S&P 500 added about 0.1%.
— Alex Harring
Deutsche Bank thinks a selloff in Iridium stock presents investors with a strong entry point.
The firm upgraded the satellite communications stock to buy from hold in a Monday note. Analyst Edison Yu attributed the roughly 21% decline the stock since reporting second-quarter earnings in July to a later-than-expected direct to device opportunity from management.
"While usage could indeed be low at the onset, we think smartphone OEMs [original equipment manufacturers] remain very committed to deploying satellite connectivity features over the next year," Yu said. "This should benefit Iridium as it receives a per device royalty regardless of end-user utilization."
— Brian Evans
What's on investors minds? "Strikes and hikes," said Sam Stovall, chief investment strategist at CFRA Research.
Stovall told CNBC that investors will be watching the Federal Reserve meeting this week, as well as central bank activity from around the globe, including in countries such as Japan, Switzerland and Sweden.
"Globally, investors are on edge waiting to find out what their central banks are likely to do," he said.
Within the U.S., Stovall said the United Auto Workers strike that began last week has raised questions about potential inflationary pressures. Ford was down more than 2% on Monday, while General Motors and Stellantis each slid more than 1%.
He noted that the autoworker strike builds on a broader theme of work stoppages in the country.
— Alex Harring
It's been an ugly 2023 for utility stocks – a favorite of income investors for their solid dividends – but there could be upside as the year winds down, Morgan Stanley said.
The utilities sector is down nearly 9% this year, but it has enjoyed a nice boost in September – where it's up close to 3%.
Morgan Stanley noted that a few catalysts can help lift shares higher into the end of the year, including key regulatory approvals for a handful of names.
"As we head into the final stretch to the end of the year, we think investors will be particularly careful in picking their spots, watching for downside tail risk and focusing on clear and meaningful catalysts to drive performance," analyst David Arcaro said in a recent note.
Read about three of the firm's utilities picks here.
— Darla Mercado
Shares of Simply Good Foods rose more than 3% after Morgan Stanley said shifting consumer preferences to healthier choices could give the company an edge over peers.
The firm upgraded the stock of the food and beverage company to an overweight rating from equal-weight in a Monday note.
"SMPL is well positioned given its portfolio of high protein, low carb and low sugar snacks, spanning multiple categories," analyst Pamela Kaufman wrote. "SMPL's solid topline growth outlook is an increasingly scarce asset in a group that is facing slowing topline growth and should support its valuation premium."
CNBC Pro subscribers can click here to read more.
— Lisa Kailai Han
RBC analyst Michael Siperco initiated coverage of Seabridge Gold on Monday with a $25 price target, suggesting shares could rally 124.4% from Friday's close.
The firm noted that Seabridge has begun to accelerate development of its Kerr-Sulphurets-Mitchell gold/copper project in the 'Golden Triangle' region of northern British Columbia. The Canada-based company's KSM project is the world's largest undeveloped gold project as measured by reserves and resources, according to the company.
"We think generational gold/copper assets in good mining jurisdictions are hard to find, and harder to advance, making KSM a potentially attractive option for producers looking for long-term, consistent production potential," Siperco wrote in a note. At full production, RBC said that KSM would be a top-five annual gold producer.
— Pia Singh
Oil service, energy and utility stocks are huge outperformers so far in September, and the gains for oil services and energy in the third quarter are even more dramatic.
Month to date, oil service stocks (as reflected in the VanEck Oil Services ETF [OIH]) are up 5.2%, S&P 500 Energy by 4.2% and even S&P 500 Utilities by 3%. The S&P 500 is down 1.1% in September.
Quarter to date shows an even wider disparity: Oil services are up 24.7%, Energy is up 13.2%, the S&P 500 is higher by less than 0.2% and utilities are down 1.7%.
Energy was the best performing S&P 500 sector in Monday's session with a 0.7% gain.
P.S. Don't look now, but Nvidia is almost 11% lower in September and Taiwan Semiconductor is down 12% in the third quarter.
— Scott Schnipper
Raymond James thinks Disney can outperform peers as legacy media transitions toward streaming.
The firm initiated coverage of Disney with an outperform rating in a Sunday note.
"Media companies are grappling with the transition from the profitable but declining Linear TV to the mostly unprofitable (as of now) but growing Streaming business," analyst Ric Pretiss says. "We believe Disney's assets position it well to navigate this transition."
CNBC Pro subscribers can read the full story here.
— Brian Evans
The three major indexes were little changed as the final hour of trading kicked off, marking some cooling for earlier climbs.
The Dow, S&P 500 and Nasdaq Composite all traded within 0.1% of their flatlines at 3 p.m. ET. At session highs, the three all traded up more than 0.3%.
— Alex Harring
Deutsche Bank says Micron stock will grow thanks to stronger pricing power.
The firm upgraded Micron to buy from hold in a Sunday note, and added that the company could outperform Wall Street estimates heading into 2024.
"While we acknowledge that MU shares have held up much better than our expectation during the downcycle, we expect further appreciation as estimates increase and valuation multiple (based on [price-to-book]) expands," analyst Sidney Ho said.
CNBC Pro subscribers can read the full story here.
— Brian Evans
The Invesco QQQ ETF, which tracks the Nasdaq 100 Index, has been trading at a remarkable 'first day of the week strength' streak, according to BTIG. The firm found that the QQQ is currently on its 12th consecutive positive first day of the week. However, it noted that the ETF's 'strength' today is "tepid at best."
"Overall breadth [is] still negative and 64% of NYSE volume [is] in declining stocks," chief market technician Jonathan Krinsky said in a Monday note.
"QQQ and SPY volumes are running ~20% below average," Krinsky added.
— Hakyung Kim
An attractive valuation, strong balance sheet and brand growth spell a bright future ahead for Ralph Lauren, according to Guggenheim.
The firm upgraded the company's stock to a buy rating from neutral on Monday, setting a price target of $166.
"Our updated view includes our belief that there are opportunities to deliver better than we previously expected gross margins into 2024 and 2025, aided by clean inventories, lower freight expenses, and lower cotton prices," analyst Robert Drbul wrote.
CNBC Pro subscribers can read the full story here.
— Lisa Kailai Han
Nike is likely to face some near-term headwinds as demand slows, especially overseas, according to Wells Fargo.
The investment bank slashed its price target for the apparel company to $120 from its previous forecast of $130, simultaneously lowering its full-year 2024 earnings to $3.60, below analyst consensus of $3.72.
"On top of worsening US retail performance (athletic footwear remains weak), our manufacturing checks likewise point to weaker forward orders," analyst Ike Boruchow wrote in a Monday note. "While the Chinese shopper being under pressure is the main call out we hear, we also note a lack of innovation/newness was also cited."
— Lisa Kailai Han, Michael Bloom
While the Federal Reserve is widely expected to leave interest rates unchanged at this week's meeting, this doesn't assure that there won't be another rate hike in the future, says Greg McBride, chief financial analyst at Bankrate.
"Inflation pressures are easing, broadly speaking, but remain well above desired levels with the risk of further increases in oil prices, so the Fed cannot yet declare victory," McBride said Monday.
He added that rates will likely stay "higher for longer" due to stronger-than-expected economic growth and inflation coming down at a slower pace.
"Even once the Fed is done raising interest rates, they're unlikely to say as much for risk of a loosening in financial conditions that undermines their objectives," he said. "A sudden pullback in long-term rates, for example, could give juice to the economy when the Fed is trying to take that away."
— Hakyung Kim
Bernstein analyst Sara Russo is telling investors to tap the breaks on the enthusiasm for Arm Holdings.
The investment firm initiated coverage of the British chipmaker with an underperform rating, warning that it was "too soon to declare them an AI winner." The stock was down nearly 8% Monday afternoon.
Read more about the call on CNBC Pro.
— Jesse Pound
Apple led the Dow higher in Monday's session as investors cheered Wall Street's take on new iPhone demand.
Both Morgan Stanley and Goldman Sachs said they had positive outlooks for demand for the new iPhone. Specifically, Morgan Stanley called preorder data "better than feared."
Shares of the big-technology stock climbed 2.5% in Monday's session. Visa, Travelers, Honeywell and Intel were also among the top performers with all up more than 1%.
American Express and Boeing restricted gains for the blue-chip average with losses of more than 2% and 1%, respectively. As a whole, the 30-stock index was up about 0.2% around 1:45 p.m. ET.
— Alex Harring
Bank of America hiked its price target for JB Hunt Transport after company president Shelly Simpson said at a conference last week that the so-called "freight recession" appears to be ending.
"The company highlighted that bid compliance is off historic lows and it sees moderating declines in Intermodal volumes. The improving forward view on the freight cycle is concurrent with an inflection in our bi-weekly Truck-Shipper Survey as our BofA Truckload Demand Indicator held above 50 for the 3rd consecutive issue after 26 wks at or below the level," analyst Ken Hoexter said in a note to clients Monday.
JB Hunt also announced on Thursday that it agreed to buy the brokerage operations of railroad company BNSF. Bank of America estimated that the deal could give a small boost to earnings per share for JB Hunt.
Bank of America's price target for JB Hunt is now $216 per share, up from $207.
— Jesse Pound
Eleven S&P 500 names hit fresh lows in midday trading Monday, including several dollar stores and solar stocks.
Dollar General traded at lows not seen since March 2019, with shares last falling 2%. Dollar Tree reached lows last seen in November 2021.
Solar stocks Enphase Energy fell to lows not seen since January 2022. Meanwhile, SolarEdge Technologies traded at its worst levels going back to July 2020.
Here are some of the other fresh S&P 500 lows:
— Sarah Min, Chris Hayes
DoorDash stock could grow thanks to exceptional market share amongst peers as food inflation cools, according to Mizuho Securities.
The firm upgraded DoorDash stock to buy from neutral in a Sunday note. Shares climbed 2.6% in Monday trading.
"We believe key drivers include continued market share gains from its category-leading position in the US, and rational competition in Europe," analyst James Lee said. "In conjunction, moderated food inflation and resilient consumer spending provide incremental support to our view."
CNBC Pro subscribers can read the full story here.
— Brian Evans
The Federal Reserve is done hiking this year, even if the dot plot that's set to release this week shows one more increase, according to Goldman Sachs.
"On November, we think that further labor market rebalancing, better news on inflation, and the likely upcoming Q4 growth pothole will convince more participants that the FOMC can forgo a final hike this year, as we think it ultimately will," the firm's chief economist Jan Hatzius wrote on Saturday.
"But we expect the dot plot to show a narrow 10-9 majority still penciling in one more hike, if only to preserve flexibility for now," he added.
The dot plot shows where individual members expect to see rates trending over the next several years. The Fed concludes its two-day policy meeting Wednesday.
— Sarah Min