S&P 500, Nasdaq Composite close higher on Tuesday: Live updates

Hakyung Kim
Alex Harring
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., February 14, 2024. 

The S&P 500 and the Nasdaq Composite ended Tuesday's session with modest gains as investors prepared for key inflation data to be released later this week.

The S&P 500 inched up 0.17% to 5,078.18. The Nasdaq added 0.37% to end at 16,035.30. The Dow Jones Industrial Average fell 96.82 points, or 0.25%, to close at 38,972.41.

Retail giant Macy's advanced 3.4% after announcing it would close around 150 of its struggling stores following a revenue miss in the prior quarter. Lowe's gained 1.7% after posting an earnings beat. Zoom Video and Hims & Hers Health rose 8% and 31%, respectively, following earnings reports that exceeded Wall Street expectations.

The market on Tuesday "really doesn't have a lot of direction," according to Sam Stovall, chief investment strategist at CFRA Research. Different sectors "are each marching to the beat of their own drummer," he added.

Indeed, the utilities sector outperformed the broader market, rising about 1.9%. Communications services also rose 1%, while the technology sector added less than 0.1%.

Those moves follow a losing day on Wall Street that pulled the Dow and S&P 500 off record highs seen last week after Nvidia's stellar earnings report.

"What's causing tech, consumer discretionary, communication services and financial stocks to do better is that they tend to do well in a interest rate pause period. Also, that's where the growth is," Stovall said. "And so I think until the Fed starts to cut interest rates, investors are not going to dramatically diversify into mid- and small-cap stocks — they really want to wait and see."

The latest consumer confidence numbers also fell on worries regarding a potential labor market slowdown and polarized political landscape, according to a Conference Board gauge released Tuesday. The board's Consumer Confidence Index declined to to 106.7, which was lower than the downwardly revised 110.9 in January and below the Dow Jones estimate for 115.1.

Data from the U.S. Department of Commerce released on Tuesday showed that orders for long-lasting goods declined more than expected in January, with the leading factor being a large drop in demand for transportation.

Those come before January's reading of the closely watched personal consumption expenditure price index, as well as data on personal income, slated for release on Thursday. Investors will watch these releases for future clues into the health of the economy and for insights into the path of monetary policy.

Stovall is estimating a month-over-month increase in both core and headline inflation, but a yearly decline in Thursday's report.

"It's almost like watching a ping-pong ball drop on a table," Stovall said.

Tue, Feb 27 2024 4:04 PM EST

S&P 500, Nasdaq Composite close slightly higher Tuesday

A trader works during the closing bell at the New York Stock Exchange (NYSE) on March 17, 2020 at Wall Street in New York City. 

The S&P 500 and Nasdaq Composite ended Tuesday's trading session in the green. Meanwhile, the Dow Jones Industrial Average came under pressure.

The S&P 500 and Nasdaq climbed 0.17% and 0.37%, respectively. The Dow slipped nearly 97 points, or 0.25%.

— Hakyung Kim

Tue, Feb 27 2024 3:32 PM EST

Microstrategy shares jump 10% after Benchmark initiates coverage with a buy rating

Benchmark Company initiated coverage of Microstrategy on Tuesday with a buy rating and said it sees about 12% upside on the stock. The shares rose about 10%.

"Microstrategy offers a unique business model focused on the acquisition and holding of bitcoins, which represent the bulk of the company's valuation, with its software business serving in a supporting role as ballast to that valuation and a generator of cash flow used for the purchase of additional bitcoins," Benchmark's Mark Palmer said in a note Tuesday.

"As such, the price of MSTR shares is highly correlated to the price of bitcoin (correlation coefficient of 0.94), although the company's use of leverage to amass its bitcoin holdings can magnify its gains relative to those realized by the cryptocurrency," he added.

The firm has a $125,000 price target on bitcoin by the end of 2025 – about 118% away from its Tuesday price – justified by the boost in demand from the newly launched U.S. spot bitcoin ETFs and the reduced pace of supply after the April halving.

— Tanaya Macheel

Tue, Feb 27 2024 3:11 PM EST

Current market rally can't be compared to the tech bubble, says Citi's Scott Chronert

While it's true that the current bull rally is being propelled by AI- and tech-adjacent stocks, Citi's Scott Chronert disagrees with comparisons to the great Tech Bubble.

"Current multiples are well below '99-'00 levels. Further, our subjective view is that the fundamental circumstance is meaningfully different now vs then," Citi Research's head of U.S. equity strategy wrote.

However, Chronert cautioned that stock fundamentals still have to support the rally in order to sustain his S&P 500 year-end target of 5,100.

"That said, the current spending ramp on gen AI infrastructure and product will need to translate to incremental revenue and growth drivers. But it is premature to judge that," he added. "While the index may overshoot our year-end 5100 target in the short term, it seems premature to increase the probability of our 5700 bull case scenario."

— Lisa Kailai Han

Tue, Feb 27 2024 2:49 PM EST

Apple cancels plans for electric car and leans into generative artificial intelligence, report says

Apple is canceling plans to build an electric car and is instead leaning into generative artificial intelligence, according to a report from Bloomberg News.

Apple scaled back its vision for the EV project last month and moved initial launch date back to 2028 from 2026, Bloomberg added. The company had originally planned for the car to be fully self driving but instead shifted to a semi-autonomous model last month. Some of the employees devoted to Apple's EV project will now work on generative AI, the report added.

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Apple stock.

Apple stock gained 0.5% following the news.

— Brian Evans

Tue, Feb 27 2024 2:27 PM EST

Dow underperforms

Traders work on the floor at the New York Stock Exchange on Feb. 7, 2024.

The Dow lagged the other major indexes on Tuesday.

The blue-chip index slipped 0.4% in the session. Meanwhile, the broad S&P 500 traded near flat, while the technology-heavy Nasdaq Composite ticked up 0.1%,

Part of that underperformance stemmed from a drop of more than 2% in Amgen and Chevron. McDonald's and Honeywell were the next biggest losers, down about 1% each.

Just around a third of the 30 stocks in the Dow were on track for gains. Disney was the best performer in the index, rising more than 1% despite the downtrend.

— Alex Harring

Tue, Feb 27 2024 2:04 PM EST

Oil prices rise as market monitors Gaza cease-fire talks, OPEC cuts

Crude oil futures rose Tuesday amid uncertainty about the prospects for a cease-fire in the Israel-Hamas war and as some investors expect OPEC+ will extend its production cuts beyond the first quarter.

The West Texas Intermediate contract for April rose $1.21, or 1.56%, to $78.79 a barrel. Brent April futures rose $1.01, or 1.22%, to $83.54 a barrel.

President Joe Biden told reporters in New York City on Monday that he hoped a cease-fire would be reached in the Israel-Hamas war by March 4. But senior Hamas officials indicated the current proposals for a truce did not meet their demands.

OPEC+ will soon make a decision on whether to extend its production cuts beyond the first quarter. Goldman Sachs expects the reductions to continue through the second quarter with OPEC+ gradually and partially phasing them out in the third quarter, according to research note published Monday.

— Spencer Kimball

Tue, Feb 27 2024 1:39 PM EST

Government shutdown would pressure defense stocks, says Morgan Stanley

Morgan Stanley believes defense stocks may be pressured if Congress fails to reach an agreement on the budget in due time.

The first federal funding deadline is approaching this Friday at midnight when several government agencies including agriculture, veterans affairs and transportation, are due to run out of money. The second is next Friday, March 8, after which a full government shutdown would take effect if there is no funding resolution.

"We've been generally surprised by the extent of budget intransigence in Washington in the wake of rising geopolitical tensions ... Upcoming government funding decisions (March 1 / March 8 deadlines) bear important implications for the apparent 'threat/budget divide,'" analyst Kristine Liwag wrote in a Tuesday note.

Liwag added that "a shutdown scenario would place further pressure on Defense stocks, in our view." In the case of a shutdown, new contracts cannot be executed and new funding cannot be allocated, she noted.

— Hakyung Kim

Tue, Feb 27 2024 1:22 PM EST

Fed's Bowman says time to cut interest rates hasn't arrived yet

Federal Reserve Bank Governor Michelle Bowman gives her first public remarks as a Federal policymaker at an American Bankers Association conference In San Diego, California, February 11 2019.

Federal Reserve Governor Michelle Bowman expressed caution expressed caution about the path of monetary policy, saying in a speech Tuesday that there are dangers in giving up the inflation fight too quickly.

"Should the incoming data continue to indicate that inflation is moving sustainably toward our 2 percent goal, it will eventually become appropriate to gradually lower our policy rate to prevent monetary policy from becoming overly restrictive. In my view, we are not yet at that point," Bowman said during a speech to bankers group in Florida.

"Reducing our policy rate too soon could result in requiring further future policy rate increases to return inflation to 2 percent in the longer run," she added. Bowman is a permanent voting member of the rate-setting Federal Open Market Committee.

The remarks were largely in keeping with communication from Fed officials in recent weeks, as they have stressed that even while rate hikes are likely over, high rates may not be.

—Jeff Cox

Tue, Feb 27 2024 12:42 PM EST

Bernstein defends Alphabet despite recent AI troubles, search concerns

In this photo illustration, a Gemini logo is seen displayed on a smartphone with a Google logo in the background.

Bernstein is defending Alphabet even as concerns mount that the company's "search empire is crumbling."

"We continue to argue that the risk to search is more severe outside of Gen AI, namely vertical and social search," wrote analyst Mark Shmulik, who holds a market-perform rating on shares. "For now, ChatGPT's engagement growth is plateauing, and "the new" Bing has been losing search revenue share since Microsoft declared war."

The commentary from Bernstein comes after Alphabet shares declined more than 4% during Monday as the search giant said it plans to relaunch its Gemini AI picture generator in a "few weeks" after users unveiled a slew of historical inaccuracies.

Some investors in recent months come to view the search giant as falling behind on the AI race, with shares suffering from poor product launches and products from competitors.

But Shmulik said its too soon to "declare Google Search dead."

"We'd much prefer Google to go off and iterate behind closed doors and come back stronger and buttoned up," he said. "And perhaps, this whole saga causes another Code Red at Google and galvanizes Google into a shake up."

He views concerns that generative AI is a current risk to the product as overdone, noting that vertical search through the likes of Amazon and Walmart, and social search via apps such as Meta and Pinterest pose greater "mid-term competitive risks."

"The biggest risk we see from the string of error-riddled gen AI product launches is that talent no longer sees Google as a premier destination to build one's career," he said.

— Samantha Subin

Tue, Feb 27 2024 12:54 PM EST

Stocks making the biggest moves midday

Norwegian Viva is the second Prima-class ship for Norwegian Cruise Line, seen here at Great Stirrup Cay on Thursday, Nov. 30, 2023. 

These are some of the stocks making the biggest moves during midday trading:

  • Norwegian Cruise Line — The cruise ship operator soared 18% on strong forward guidance.
  • Unity Software — The video game developer dropped about 9% on disappointing EBITDA guidance.
  • Viking Therapeutics — The clinical-stage biotech soared more than 90% after fulfilling primary and secondary endpoints in its Phase 2 GLP-1 study.

Read the full list of stocks on the move here.

— Samantha Subin

Tue, Feb 27 2024 12:20 PM EST

Viking Therapeutics shares skyrocket, putting pressure on Eli Lilly stock

Eli Lilly shares have been riding the excitement over anti-obesity drugs for quite a while, but not today. Shares were down slightly as investors rallied around Viking Therapeutics, a clinical stage biopharmaceutical company that is developing an oral drug that would compete with Lilly's Zepbound.

Viking's therapy, VK2735, showed promising results in a phase 2 trial. Patients enrolled in the study tolerated the drug very well, with very few stopping treatment. On average, they saw a 13.1% drop in their weight during the trial, and there were signs that further losses could be achieved.

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Viking stock year to date.

Viking shares were up more than 90% in recent trading. Even ahead of Tuesday's news, the stock has soared so far this year.

Although Viking's results are promising, analysts believe the market is so vast for these drugs that there is an opportunity for additional players. Also both Novo Nordisk and Lilly, the market leaders, also have next-generation drugs in their pipeline.

—Christina Cheddar Berk

Tue, Feb 27 2024 12:00 PM EST

Warner Bros. Discovery halts merger talks with Paramount Global, sources say

Signage at a Warner Bros Discovery office in New York, US, on Saturday, Feb. 17, 2024.

Warner Bros. Discovery has gone "pencils down" on a potential acquisition of Paramount Global , halting talks after several months of kicking the tires on merging the media companies, according to people familiar with the matter.

Skydance Media, the film and TV studio run by David Ellison, is still performing due diligence on a potential transaction, two of the people said.

Paramount Global has set up a special committee, which has hired its own financial adviser, to sift through potential bids for the whole company or certain assets. Media mogul Byron Allen offered $14 billion for the company last month, though he has a history of bidding on and not buying large media assets.

Warner Bros. Discovery shares rose 1.6% in midday trading. Paramount Global shares gained 1.7%.

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Warner Bros. Discovery

— Alex Sherman, Sarah Min

Tue, Feb 27 2024 11:45 AM EST

History shows Tuesday is the worst market day of the month

Traders work on the floor of the New York Stock Exchange during morning trading on February 23, 2024 in New York City. 

If history repeats itself, Tuesday could end poorly.

The 27th has the worst average daily return for the S&P 500 in February, according to a Carson Group analysis of data between 1950 and 2023. On average, the broad index has ended the day down 0.24%.

To be sure, the market has blown past historical expectations thus far in the month.

February is typically the second worst month of the year for the S&P 500, per data from the Stock Trader's Almanac between 1950 and 20222. The benchmark index has shed about 0.04% in an average February.

This year, the S&P 500 has jumped more than 4% so far in the month.

— Alex Harring

Tue, Feb 27 2024 11:25 AM EST

Utilities stocks outperform Tuesday

Turbines that are part of Constellation Energy's Criterion Wind Project stand along the ridge of Backbone Mountain near Oakland, Maryland.

The utilities sector was the top-gaining sector Tuesday as the S&P 500 traded near the flatline.

Utilities rose 1.3%, with Constellation Energy popping more than 11%.

The only other sectors in the green were consumer discretionary and materials, which ticked up 0.5% and 0.2%, respectively.

Meanwhile, the energy and financials sectors saw the biggest declines, falling 0.8% and 0.3% each.

— Hakyung Kim

Tue, Feb 27 2024 11:07 AM EST

Cruise stocks glide higher after strong Norwegian guidance

Norwegian Cruise Line skyrocketed 15% after offering upbeat current-quarter guidance, and lifted the broader cruise sector in tandem.

The company posted a wider-than-expected loss for the current quarter, but said that it that it anticipates a surprise profit of 12 cents a share for the current period. That's above the 20-cent loss analysts polled by FactSet anticipated.

The strong guidance boosted other cruise giants. Royal Caribbean surged more than 4%, while Carnival Corporation skyrocketed more than 7%.

— Samantha Subin

Tue, Feb 27 2024 10:46 AM EST

Cybersecurity stocks, ETFs outperforming on Tuesday

Stocks and ETFs tied to cybersecurity are showing strength in what has been a sluggish start for Wall Street on Tuesday.

The Global X Cybersecurity ETF (BUG) rose 1.2%, while the iShares Cybersecurity and Tech ETF (IHAK) rose 0.9%.

Palo Alto Networks was a standout in the group, rising more than 4% and on track for its fourth-straight positive session.

— Jesse Pound

Tue, Feb 27 2024 10:27 AM EST

IPO ETF tracks for best month in over a year

An index tracking newly public stocks is on pace for its best month in more than a year.

The Renaissance IPO ETF (IPO) has climbed more than 14% in February. If that holds through the end of the month, the fund will notch its biggest monthly gain since January 2023, when it rallied 15.9%.

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The Renaissance IPO ETF over the last month

The fund includes stocks that came to the market through initial public offerings starting at the end of their fifth day of trading. These stocks are removed after 500 trading days.

Arm Holdings led the fund higher this month, surging more than 99%. Coinbase posted the next biggest gain, up more than 59% on the month. Confluent, Robinhood and AppLovin followed, with each advancing more than 40%.

To be sure, some stocks in the fund bucked the trend. Rivian was the worst performer in the fund this month with a drop of around 30%, followed by Fluence Energy at 21% down.

The fund also hit highs not seen since early 2022 in Tuesday's session.

— Alex Harring, Gina Francolla

Tue, Feb 27 2024 10:09 AM EST

Consumer confidence declines on concerns over jobs, politics

People shop at the Macy's store on Herald Square on January 19, 2024 in New York City. 

Consumer confidence slipped in February as worries escalated over a potential labor market slowdown and a tumultuous political environment, according to a Conference Board gauge released Tuesday.

The board's Consumer Confidence Index moved down to 106.7, below the downwardly revised 110.9 in January and off the Dow Jones estimate for 115.1. Moreover, the Expectations Index nudged down to 79.8, just below the 80 benchmark that has been consistent with recessions.

Written responses to the survey showed easing fears about food and energy prices, but "they are more concerned about the labor market situation and the US political environment," said Dana Peterson, chief economist at The Conference Board.

—Jeff Cox

Tue, Feb 27 2024 10:06 AM EST

Record highs in global equities is 'no sell signal,' Bank of America Securities says

Global equities are at all-time highs but that doesn't mean it's time for investors to sell, according to Bank of America Securities.

"An all-time high is a not a sell signal," Nigel Tupper wrote in a Tuesday note titled "No sell signal." "The MSCI AC World Index reached an all-time high in February so contrarian investors may turn cautious on equities, but it's worth remembering equity markets efficiently reflect earnings growth through time."

In fact, Tupper said "2024 could be a strong year for equities," given the median earnings per share growth estimate for global stocks is 16%. In particular, he expects that tech will particularly benefit, as opposed to defensive sectors.

"The recent inflection in the Global Wave suggests investors should now position for a sustained upturn," Tupper added.

The iShares MSCI ACWI ETF is more than 4% higher in 2024.

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— Sarah Min

Tue, Feb 27 2024 9:30 AM EST

Stocks open flat Tuesday

U.S. stocks started Tuesday's trading session little changed.

The Dow Jones Industrial Average slipped 42 points, or 0.1%.

The S&P 500 and Nasdaq Composite inched up 0.1% and 0.2%, respectively.

— Hakyung Kim

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