US Open: weak retail sales do not bother investors 📌

3:06 PM 18 June 2024
  • Indices Open Slightly Higher
  • USDIDX erases gains from earlier in the day
  • US bond yields decline

US stock markets opened slightly higher after impressive gains at yesterday's close. However, the mood on Wall Street is nervous due to historically high stock valuations combined with high interest rates.

Recent data from the U.S. economy is mixed. On one hand, we see the first signs of a slowdown, or rather normalization. This conclusion can be drawn from retail sales data, where high interest rates are starting to negatively affect U.S. consumers. Today's report marked the second consecutive month of weaker-than-expected data and continued monthly declines. On the other hand, investors are also receiving strong data, such as the recent NFP report from the labor market and today's industrial production data, which also exceeded expectations. Several speeches by FOMC members are scheduled for later today, which may shed some light on future Fed monetary policy.

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US100

The technology index has seen an impressive 7.0% increase since the beginning of June. The earnings season has been solid, and many key companies expect further improvement in the coming quarters. Yesterday's gains were mainly driven by companies like Broadcom, Micron, Tesla, and Apple. Despite slight gains to 19,950 points at the opening of today's cash session, we are currently seeing a deterioration in sentiment. The US100 index faces a key psychological resistance level at 20,000 points. It is possible that this will be a good opportunity for at least a short-term correction.

Source: xStation 5

 

Company News

Rocket Lab USA (RKLB.US) gains over 7.50% after signing the largest Electron launch agreement in its history, with launches scheduled from 2025 to 2027, marking a significant milestone for the space systems company.

KB Home (KBH.US) the stock is in focus as the home builder is set to report Q2 results, with expectations of $1.81 earnings per share on $1.65B revenue. This follows Lennar’s (LEN.US) forecast of Q3 new orders and deliveries missing estimates, amidst high home prices and low sales.

Lennar (LEN.US) despite Q2 results beating consensus, shares dropped over 2.50% due to a disappointing Q3 forecast, with new orders and deliveries missing expectations, and a lower-than-expected gross margin on home sales.

GameStop (GME.US) is set to drop further by a 7.80% after a 12% decline in the previous session. The video game retailer's annual meeting provided no new strategies or prospects, with CEO Ryan Cohen emphasizing cost-cutting and profitability without specifics, leaving shareholders' questions unanswered.

Micron Technology (MU.US): gains another 5.00% following bullish actions by BofA Securities, which added Micron to its US 1 List, signaling strong investment potential. Micron is expected to report a significant revenue increase in its upcoming FQ3 2024 report.

Chegg (CHGG) jumped over 21% after announcing a 23% reduction in global headcount, saving $40M-$50M in 2025 expenses, despite a $10M-$14M restructuring charge. The company aims for EBITDA margins of at least 30% in FY2025.

NextEra Energy (NEE) fell 4.00% after announcing a $2B equity units sale to fund energy projects and corporate purposes, including repaying commercial paper obligations.

CleanSpark (CLSK.US) announced the acquisition of five bitcoin mining facilities in Georgia for $25.8M, increasing its operating hashrate to over 3.7 EH/s upon full installation. Despite this expansion, shares were trading down around 0% pre-market.

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