Wall Street hesitates before market trading this Monday, with the S&P 500 losing 0.1% and the Dow Jones 0.2%, compared to a gain of 0.1% on the Nasdaq. The $10,000 billion Microsoft/Nvidia/Apple trio remains solid. Nvidia takes another 1.3% with a broker note, while Apple is expected to be in the green, still in the wake of its announcements last week concerning its plans in artificial intelligence with Apple Intelligence and OpenAI… On the Nymex, a barrel of WTI crude gained 0.5% to $78.4. An ounce of gold fell 0.6% to $2,335. The dollar index stabilizes against a basket of currencies.
On the economic front, the New York Fed’s Empire State manufacturing index for the month of June stood at -6, compared to the FactSet consensus -8.4 and -15.6 a month before. Thus, the indicator still shows a decline in activity, but less pronounced than in the previous month.
Patrick Harker, the head of the Philadelphia Fed, will speak during the day.
Minneapolis Fed President Neel Kashkari said yesterday it was reasonable for the US central bank to cut interest rates once this year, but until December.
The Fed last week kept its key rate in the range of 5.25 to 5.50%, at a 23-year high, in order to maintain continued pressure on the economy and curb inflation. The bank released projections showing a median forecast of 19 U.S. central bankers calling for just one rate cut this year.
“We’re in a really good position right now to take our time, get more data on inflation, more data on the economy, on the job market, before we have to make a decision,” Kashkari said. “We are in a strong position, but if you just say there will be a reduction, as the median indicates, it will probably be towards the end of the year”… “We need more evidence to convince us that inflation is on the way to falling back to 2%,” insisted the official in an interview with CBS.
Tomorrow Tuesday, operators will follow US retail sales for the month of May, industrial production figures, as well as business inventories and sales. Thomas Barkin, Lorie Logan, Alberto Musalem and Austan Goolsbee of the Fed will speak.
The American real estate market index is expected on Wednesday, while on Thursday, the program will be expanded with housing starts and building permits, unemployment claims, the Philadelphia Fed manufacturing index, the balance of accounts current markets, the Atlanta Fed’s inflation expectations index, and the weekly report on US domestic oil stocks.
Finally, on Friday, for Four Witches Day, operators will monitor the US composite flash PMI index, existing home resales, as well as the Conference Board leading indicators index.
In the news of companies listed on Wall Street, Lennar publishes its accounts this evening, KB Home tomorrow, Steelcase Wednesday, and Accenture, Kroger, Darden Restaurants and Jabil announce Thursday.
Values
Nvidia is still gaining a little ground before market this Monday on Wall Street towards $133, for a market capitalization of nearly $3.3 trillion, neck and neck with Microsoft and Apple for the place of largest global capitalization. The rally continues since the stock split by 10 a week ago. The stock has gained more than 160% already this year, driven by the enthusiasm around artificial intelligence and the strong demand for its chips dedicated to AI. Susquehanna has just set a price target of $160 on the stock compared to $145 previously, while maintaining its positive recommendation. The increased target corresponds to a multiple of 51.5 times the broker’s 2025 adjusted earnings per share forecast for Nvidia. The broker’s target is the highest on Wall Street on Nvidia, while according to FactSet, the average target is just $124. This target price would bring out a capitalization of nearly 4,000 billion dollars.
Microsoft is at the top before the market on Wall Street, while Wedbush has just raised its price target from $500 to $550, estimating that artificial intelligence should modify the growth trajectory of the software giant in the cloud. The recommendation is maintained at ‘outperform’. Furthermore, according to ‘The Information’, the AI startup supported by the colossus of Redmond, OpenAI, which is at the origin of the essential chatbot ChatGPT, would consider modifying its governance and abandoning its non-profit status lucrative. This is what the company’s CEO, Sam Altman, reportedly told some shareholders.
Autodesk is still gaining ground before the market on Wall Street, while activist investor Starboard Value has, according to the Wall Street Journal, acquired a stake of around $500 million in the software group’s capital and intends to lobby to obtain developments. The WSJ cites sources close to the matter. Starboard says Autodesk needs to improve its margins and make changes to its board of directors. The activist met with Autodesk executives to discuss concerns related to operations, governance and the handling of a recent accounting investigation. Recall that the group had earlier this month revealed a preliminary turnover higher than market expectations at around $1.42 billion. In addition, financial director Deborah Clifford had been appointed director of strategy, effective immediately, while Elizabeth Rafael, group director, had been appointed as interim CFO.
GameStop, the favorite ‘meme stock’ of small American investors, is holding its general meeting this Monday, while the influencer Roaring Kitty has awakened the issue by taking a stake and “pushing” the value on social networks, allowing the passage the group’s management to raise more than $3 billion in two angelic capital increases. The group’s general meeting was postponed last week due to a technical problem resulting from strong shareholder demand.
Best Buy, the flagship consumer electronics retailer, benefits from a positive rating from UBS which has just revised its buy recommendation, citing favorable prospects and restructuring efforts.
