Tesla, Supermicro lead shares higher to kick off Santa rally

Biggest S&P 500 Movers on Tuesday

Dec 24, 2024 2:13 PM EST

Progress:

• Tesla ( TSLA ) shares rose 7.4%, leading the S&P 500 and leading an upbeat trading session for Magnificent Seven tech stocks. Barclays analysts noted that while they expect the electric car maker to post record deliveries in the fourth quarter, the effect on the stock could be minimal. Rather than short-term metrics, the investment bank believes Tesla’s recent momentum hinges on its long-term opportunities in self-driving and artificial intelligence.
• Super micro computer (SMCI) shares rose 6%, partially recovering from a series of losses that coincided with last week’s removal of the stock from the Nasdaq 100 index. Earlier this month, the server and data storage provider received an extension from the Nasdaq exchange for filing its delayed annual report until February.
• The December rally continued for stocks at Broadcom (AVGO), which added 3.2%. The chipmaker’s Christmas advance extended gains in the previous session after UBS analysts raised their AI revenue estimates for Broadcom and raised their price target on the stock.
• Starbucks (SBUX) shares ticked 2.8% higher. The union-backed baristas who have taken part in a strike against the coffee chain are expected to return to work tomorrow. A Starbucks executive said Monday that about 97% to 99% of stores will remain open, adding that the strike was not expected to have a major effect on operations nationwide.

Detractors:

• The weakest Christmas Eve performance in the S&P 500 belonged to stocks in Walgreens Boots Alliance (WBA), which fell 1.2 per cent. The stock had a bump earlier in December following reports that the pharmacy operator was in talks to sell itself to private equity firm Sycamore Partners, but it has been lower since and is still down nearly 65% ​​in 2024.
• Shares of supplier of industrial chemicals Celanese (CE) also fell 1.2%. RBC recently lowered its price target on Celanese stock, citing pressure on the company’s margins from high energy costs.

-Michael Bromberg

Wall Street Expected a Good Year for These 3 Stocks – What Happened?

24 December 2024 at 12:45 PM EST

No one can predict the future, and Wall Street analysts, despite it being part of their job, are no exception.

According to a December 2023 analysis from FactSet Research, analysts expected energy stocks in the S&P 500 to rise more than 25% this year, about double the expected return of the next-best sector. Three of the 10 S&P 500 stocks that analysts were most bullish on at the start of this year were in energy: Oil services providers SLB ( SLB ) and Halliburton ( HAL ) and oil and gas producer APA Corp. (APA).

It didn’t go as Wall Street expected. For the second year in a row, the sector trailed the broader market. Of the industries tracked by an S&P Global index, oilfield services and oil and gas exploration are the two worst performers in 2024, down 11% and 8%, respectively, through Monday’s close. Each of the three stocks listed above has lost more than a quarter of its value this year.

See here for more on what went wrong for the energy sector this year.

Bulls Hope for ‘Santa Claus Rally’ ends 2024

Dec 24, 2024 11:57 AM EST

Bulls are hoping Santa puts a stop to the progress the stock market has made so far in 2024.

Wall Street is eager for a so-called Santa Claus rally to propel the S&P 500 — up about 25% this year through Monday’s close — to new highs. According to Wall Street history, the stock market consistently rises during the last five trading days of the year and the first two sessions of the next. This year, that stretch starts today.

The market is well poised to rise this year, said Ryan Detrick, chief market strategist at the Carson Group, despite the fact that the Dow Jones Industrial Average recently fell for several days in a row and other indexes faltered before advancing yesterday.

Santa Claus has a track record of delivering to Wall Street at the end of Christmas. From the fifth-last trading day of the year to the second session of the next year, the S&P rose 76% of the time since 1999, according to Carson Group analysis. Gains averaged 1.7% when there was a rally, the analysis shows.

“It’s a modest convention,” it said Almanac editor-in-chief Jeffrey Hirsch, whose father coined the “Santa Claus Rally” phrase. “But when it doesn’t show, it means traders are nervous.”

Some significant economic downsides have emerged after stocks stumbled during those seven sessions, analysts say.

However, every rule of thumb has exceptions. Last year, the S&P fell 0.9% during this period before continuing to hit record after record in 2024.

-Sarina Trangle

Tesla leads a whopping seven shares higher

Dec 24, 2024 11:04 AM EST

Tesla’s ( TSLA ) shares were among the S&P 500’s top gainers Tuesday morning as the Magnificent Seven major tech stocks rose on Christmas Eve.

The electric car maker’s shares recently rose more than 4%, making them the second-best performer in the benchmark index — second only to Super Micro Computer ( SMCI ).

Other “Mag 7” stocks also rose this morning, a holiday-shortened session that precedes a day off tomorrow and kicks off the Santa Claus Rally period. The major indexes rose this morning, led by the Nasdaq Composite.

Amazon.com ( AMZN ) added 1.3%, the biggest gainer for the rest of the Magnificent Seven. Nvidia ( NVDA ) and Meta Platforms ( META ) recently gained 0.9%. Apple (AAPL), Microsoft (MSFT) and Alphabet (GOOGL) were also in the green.

-David Marino-Nachison

US Steel Stocks Wobble As Regulators Punt Nippon Agree With Biden

Dec 24, 2024 10:01 am EST

Shares in US Steel ( X ) fell 1% on Tuesday after US regulators failed to agree on whether Japanese firm Nippon Steel’s $14.9 billion purchase of the company should go through, instead of passing it on to President Biden to decide.

The president now has 15 days to make the decision. Both he and President-elect Donald Trump have expressed opposition to the merger, arguing that a key US steelmaker should not be owned by a foreign entity.

US Steel responded to the decision by the Committee on Foreign Investment in the United States (CFIUS), saying the deal “strengthens America’s national and economic security through investment in manufacturing and innovation.” It added that the Nippon transaction is “by far the best way to ensure that US Steel, including its employees, communities and customers, will thrive well into the future.”

The Japanese company has pledged to invest more than $2.7 billion in US Steel facilities, and CEO David Burritt has warned of plant closings and the possibility of moving the company’s headquarters from Pittsburgh, where it has been since 1901, if the government blocks the sale .

US Steel shares have yo-yoed this year on the back and forth news of the Nippon acquisition. They fell to their lowest level since September last Friday after warning that falling steel prices and the costs associated with the construction of a new plant in Arkansas would affect the current quarter’s results. The shares have lost more than a third of their value this year.

-Bill McColl

American Airlines Shares Recover After Morning Slump As ‘Technical Issue’ Disrupts Flight Departures

December 24, 2024 09:00 AM EST

The Federal Aviation Administration (FAA) canceled a short nationwide ground stop requested by American Airlines (AAL) on Christmas Eve, one of the busiest travel days of the year.

“A technical issue is affecting American flights this morning,” American Airlines said, according to reports. “Our teams are working to resolve the issue as quickly as possible and we apologize to our customers for the inconvenience.”

Americans are expected to travel in large numbers this holiday season. The American Automobile Association (AAA) estimated earlier this month that more than 119 million people will travel at least 50 miles from home between Dec. 1 and New Year’s Day, topping the record for 2019. More than 7.8 million of those were expected to fly, AAA said .

U.S. stocks were down about 1% half an hour before markets opened, having recovered from a sharp 4% drop earlier Tuesday morning.

– Aaron Rennie

Stock futures steady ahead of holiday-shortened session

December 24, 2024 8:20 AM EST

Futures contracts linked to the Dow Jones Industrial Average were down less than 0.1% in early trading on Tuesday.

S&P 500 futures rose 0.1 percent.

Nasdaq 100 futures rose 0.2 percent.