Dow Jones Today: Stocks Inch Higher as Market Looks to Rebound ...
Stocks were slightly higher Thursday afternoon following a massive downturn yesterday sparked by news that the Federal Reserve expects to make fewer interest rate cuts next year.
The Dow Jones Industrial Average was up 0.3% in recent trading, while the S&P 500 and Nasdaq Composite added 0.2%, with each index down from earlier highs. U.S. stocks posted their biggest one-day losses in four months on Wednesday, as the Dow fell 2.6% to extend its losing streak to ten consecutive sessions, while the S&P 500 and Nasdaq Composite fell 3% and 3.6%, respectively.
The sell-off yesterday came after the Fed cut its benchmark rate by a quarter point, as had been expected, but indicated that its policy committee would be taking a cautious approach moving forward as it looks for signs that inflation remains under control. Policy committee members expect two quarter-point cuts in 2025, according to projections released yesterday, down from the four cuts they had penciled in the last time projections were issued in September.
Mega-cap technology stocks were mostly higher in recent trading, led by gains for AI investor favorite Nvidia (NVDA) and Amazon (AMZN), which were each up about 2%. Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL) and Meta Platforms (META) also gained. EV maker Tesla (TSLA) fell nearly 4%, the second straight day of big declines after a huge post-election rally.
Shares of chipmaker Micron (MU) tumbled 17% after the chipmaker reported mixed quarterly results and issued a disappointing outlook.
Among other noteworthy post-earnings movers, shares of Olive Garden parent Darden Restaurants (DRI) were up 15%, leading S&P 500 gainers, while consulting giant Accenture (ACN) gained 7%. Shares of Lennar (LEN) were down 6% after the homebuilder released its quarterly results, while Lamb Weston (LW) plunged 23% after the maker of frozen french fries reported disappointing results and appointed a new CEO.
The yield on 10-year Treasurys, which is sensitive to expectations about where interest rates are headed, rose to 4.58% recently, up from 4.50% yesterday and trading at its highest levels since May.
Bitcoin was trading at $99,300, near its lowest levels of the day and well below the record of over $108,000 set earlier this week. Gold futures were down nearly 2% at $2,600 an ounce, while crude oil futures were down about 0.5%.
Darden Surges as LongHorn Steakhouse Strength Powers Sales
58 minutes ago
Shares of Darden Restaurants (DRI) surged Thursday to lead S&P 500 gainers as the company's fiscal 2025 second-quarter sales and adjusted profit beat expectations on strong LongHorn Steakhouse results.
Darden—which operates LongHorn, Olive Garden, Ruth's Chris, and other restaurant chains—recorded net income of $215.1 million, or $1.82 per share, on revenue of $2.89 billion. Darden reported adjusted earnings per share (EPS) of $2.03.
Same-restaurant sales surged 7.5% year-over-year at LongHorn, well above the 4.3% growth analysts expected. Olive Garden same-restaurant sales also rose more than expected at 2%, but its fine dining operations declined 5.8%, nearly double the 3% drop analysts anticipated.
LongHorn's performance has been strong throughout the year. Executives have said that consumers have been willing to spend on things like a steakhouse meal when they feel they are getting their money's worth.
Darden updated its fiscal 2025 outlook, lifting its revenue projection to about $12.1 billion from the prior range of $11.8 billion to $11.9 billion.
The stock was up 15% in recent trading, pushing it into positive territory for the year.
-Aaron McDade
Accenture Surges as Earnings Top Estimates, AI Demand Grows
1 hr 42 min ago
Shares of Accenture (ACN) surged Thursday after the professional services and consulting firm reported first-quarter results that topped analysts' expectations and lifted its full-year revenue growth forecast.
Accenture posted $17.7 billion in revenue for the quarter, up from $16.2 billion the same time last year and above the $17.1 billion analysts projected as AI bookings climbed. The company recorded $2.28 billion in net income, or $3.59 per share, better than the $1.98 billion, or $3.10 per share, the company reported a year ago.
Accenture said it anticipates second-quarter revenue of $16.2 billion to $16.8 billion. The company also lifted its full-year revenue outlook, projecting growth of 4% to 7% compared to fiscal 2024, up from 3% to 6% previously.
However, the Ireland-based firm lowered its full-year earnings per share (EPS) projection, warning exchange rates would have a negative impact of 0.5% compared to last year. Accenture had previously expected it to have a 1.5% positive effect.
The company now expects EPS between $12.43 to $12.79, down from $12.55 to $12.91 previously, which still amounts to growth of 9% to 11% from last year.
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Accenture shares were up 7% Thursday morning, putting them back in the green for the year
-Aaron McDade
Vertex Shares Plunge Following Pain Drug Study Results
2 hr 57 min ago
Vertex Pharmaceuticals (VRTX) shares sank Thursday morning after the company reported mixed results in a Phase 2 drug trial to treat lumbosacral radiculopathy (LSR), which causes leg and back pain.
The company said the trial of suzetrigine "met the primary endpoint with a statistically significant and clinically meaningful 2.02 point within-group reduction from baseline in the Numeric Pain Rating Scale (NPRS)."
However, the placebo reference arm "showed a similar within-group reduction from baseline in pain with a mean change in NPRS at Week 12 of -1.98," Vertex said. It added that "the study was not designed nor powered for statistical comparison between suzetrigine and placebo."
Vertex shares were down 12% in recent trading, pushing them into negative territory for the year.
-Aaron Rennie
Lamb Weston Plunges After Unexpected Loss, CEO Change
3 hr 30 min ago
Shares of Lamb Weston (LW) plunged nearly 20% in early trading Thursday after the maker of frozen fries swung to a surprise loss, cut its fiscal 2025 guidance, and appointed a new Chief Executive Officer (CEO).
The Idaho-based company reported a second-quarter loss of $36.1 million, or $0.25 per share, while analysts polled by Visible Alpha were expecting a profit of $88.0 million, or $0.61 per share. Revenue of $1.60 billion also was shy of expectations.
In a separate release, Lamb Weston announced that current Chief Operating Officer (COO) Michael J. Smith would take over the CEO role from Tom Werner, effective Jan. 3. Werner, who also will be replaced by Smith on the board, "will serve in an advisory role through August 31, 2025 to ensure a smooth transition," the company said.
The company cut its fiscal 2025 targets, now projecting sales of $6.35 billion to $6.45 billion, earnings per share (EPS) of $2.30 to $2.45, and adjusted EPS of $3.05 to $3.20. Last quarter, it guided for sales of $6.6 billion to $6.8 billion, EPS of $2.70 to $3.15, and adjusted EPS of $4.15 to $4.35, with both per-share targets having been reduced from prior targets.
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Lamb Weston shares were down 17% about half an hour after Thursday's opening bell. The stock is down 40% since the start of the year.
-Aaron Rennie
Micron Price Levels to Watch as Stock Slides on Weak Outlook
4 hr 33 min ago
Micron Technology (MU) shares fell sharply in premarket trading Thursday after the memory chip maker and Nvidia (NVDA) partner issued a weaker-than-expected current-quarter outlook.
While the Idaho-based company said it sees a return to growth in the second half of fiscal 2025, it anticipates consumer-oriented markets to remain weaker in the near term. In prepared earnings call remarks, executives attributed the light outlook to a slower-than-expected PC upgrade cycle and softer auto and industrial markets.
Micron shares were down 11% at around $92 in recent premarket trading. Through the close of trading Wednesday, the stock had gained 22% since the start of the year, roughly in line with the S&P 500’s 23% return over the same period.
The stock looks set to stage a decisive breakdown below a trading range on Thursday, increasing the potential for further earnings-driven selling.
Investors should monitor key price levels on Micron's chart around $85, $78, and $72, while also watching an important overhead area near $97.
Read the full technical analysis piece here.
-Timothy Smith
Futures Point to Higher Open for Major Indexes
5 hr 13 min ago
Futures tied to the Dow Jones Industrial Average were up 0.7%.
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S&P 500 futures added 0.9%.
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Nasdaq 100 futures were up 0.8%.
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