Dow Rebounds as Tech Giants Await Quarterly Earnings
The S&P 500 surged on Monday, led by a rebound in the technology sector. The rally comes after a sharp sell-off last week, which marked the index’s sixth consecutive weekly decline and its largest weekly loss since March 2023.
Investors are now looking ahead to a slew of quarterly earnings reports from major tech companies. Tesla, Facebook-owner Meta Platforms, Microsoft, and Google-owner Alphabet are all scheduled to report this week.
Tesla shares fell over 3% on Monday following the company’s announcement of fresh price cuts in several key markets, including China and Germany. This move comes days after similar reductions in the United States, raising concerns about a potential price war in the electric vehicle industry.
Earnings Delight for ZionsBancorp, Verizon Falls Despite Strong Results
Elsewhere in the market, Verizon Communications stock dropped more than 4% despite the telecoms giant reporting better-than-expected wireless subscriber numbers in the first quarter. However, weaker-than-expected cash flow of $2.7 billion in the quarter overshadowed this positive news.
Zions Bancorporation, on the other hand, gained 3.5% after reporting quarterly results that beat both top and bottom line estimates. The company benefited from lower credit provisions. Morningstar analysts believe Zions stock is undervalued, citing market pessimism about its net interest income outlook.
2-Year Treasury Yield Touches 5% Ahead of Key Inflation Data
The yield on the 2-year Treasury briefly topped 5% on Monday, extending recent gains. Investors are anticipating a slew of key economic data this week, including manufacturing data, preliminary economic growth data for Q1, and the Fed’s PCE price index data, the Fed’s preferred inflation gauge.
These upcoming data releases have dampened expectations for interest rate cuts, with only two cuts now expected, which is below the Fed’s projection for two cuts. The Fed is widely expected to leave interest rates unchanged at its meeting on May 1, but investors will scrutinize Chairman Jerome Powell’s commentary for clues about the future rate outlook.
Salesforce Drops Informatica Deal Talks, Matterport Soars on Takeover Offer
Salesforce stock rose 1.3% after the business software maker ended talks to acquire data-management software firm Informatica. The two companies could not agree on terms.
Matterport Inc stock jumped 175% after CoStar Group announced a deal to acquire all outstanding shares of the company for $5.50 per share, valuing the deal at $1.6 billion.
Cryptocurrency Stocks Gain on Bitcoin’s Halving Event
Cryptocurrency-related stocks, such as Marathon Digital Holdings Inc, Coinbase Global Inc, Riot Platforms, and MicroStrategy Incorporated, surged on Monday as Bitcoin’s price rose to $66,402 following its halving event.
The halving event, the fourth since Bitcoin’s inception, reduces the number of bitcoins produced on the blockchain by miners by half.
