US OPEN: Pre-earnings trading puts Nvidia shares down

• Wall Street in mixed mood at the start of Tuesday's session 
• Weakening Nvidia shares put pressure on Nasdaq index quotes

Wall Street begins Tuesday's trading session in mixed sentiment. Nearly 1.2% declines in Nvidia stock valuations cause the Nasdaq to fall from historic highs. An element of uncertainty at the start of the session was also brought by hawkish comments from Waller and Bostic. The bankers added that the risk of a recession is diminishing, and that further months presenting weakening upward pressure on the economy will be required to assess whether to cut interest rates in the near term.

Current quotes of selected US companies. Source: xStation 

Trading chart of the US2000 index, W1 interval. The benchmark is losing at the beginning of Tuesday's US cash session and thus trading in the key zone of 2100 points. Futures are currently losing 0.50%. The reaction to the aforementioned psychological point and its final outcome may determine whether the demand side manages to extend the uptrend or a deeper supply reaction begins to be formed.  If the uptrend continues, the key level to watch may be the zone of local peaks near 2150 points. On the other hand, a downward movement could lead to a retest of the 2050 points zone, the 50% Fibo elimination of the downward wave initiated in November 2021, Source: xStation

News

GAP (GAP.US) shares are gaining nearly 2.3% at the start of today's cash session on the back of Citi Bank's stance that the company may report better-than-expected financial results for Q1 2024. The quarterly report will be released on May 30. 

Raymond James initiated analyst coverage on shares of Caesars Entertainment (CZR.US) with a “buy” rating. 

ZIM Integrated Shipping (ZIM) shares are losing nearly 11% after the cargo handling and shipping company reported first-quarter earnings per share that missed analysts' expectations.

FIRST QUARTER RESULTS

• Revenues $1.56 billion, +14% y/y, estimated $1.57 billion
• EPS 75c vs. loss of 50c y/y, estimate 99c
• Adjusted operating profit $167m vs. loss $14m y/y, estimated $223.3m
• Adjusted Ebitda $427m, +14% y/y, estimated $521.2m
• Adjusted Ebitda margin 11% vs. -1% y/y
• Adjusted Ebitda margin 27% vs. 27% y/y
• Average freight rate per TEU $1,452, +4.5% y/y

Nearly 9% declines are currently being seen in the stock of Palo Alto Networks (PANW.US). The company reported mixed results for its fiscal third quarter and released slightly worse earnings forecasts for the full year. 

FORECASTS FOR THE FOURTH QUARTER

• Projected revenue of $2.15 billion to $2.17 billion, estimates $2.17 billion
• Projected adjusted earnings per share of $1.40 to $1.42, analyst consensus was $1.42

ANNUAL FORECAST

• Forecast revenue of $10.13 billion to $10.18 billion, previously estimated $10.10 billion to $10.20 billion, analyst consensus was $10.19 billion
• Adjusted earnings per share (EPS): $5.56 to $5.58, analyst consensus was $5.52

THIRD QUARTER RESULTS

• Adjusted EPS $1.32, estimate was $1.26
• Revenue $1.98 billion, +15% y/y, estimated $1.97 billion
• Product revenue $391.0 million, +0.7% y/y, estimate $390.7 million
• Subscription and support revenues $1.59 billion, +20% y/y, $1.58 billion estimate
• Deferred revenue $5.01 billion, +21% y/y, estimated $5.08 billion
• Research and development expenses $457.2 million, +11% y/y, $461.7 million estimate
• Other commitments to perform $11.3 billion, +23% y/y, $11.28 billion estimate

Analyst action

JPMorgan raises target price for Boot Barn Holdings (BOOT.US) shares to $125 from $115, based on improved pricing policies for men's and women's shoes and increased sales of men's shirts.

JPMorgan raises its target price for United Therapeutics (UTHR.US) shares to $300 from $280, following the company's strong first-quarter results.