Stocks Rise as Major Indexes Wrap up a Volatile August With Monthly Gains

Biggest S&P 500 Movers on Friday

August 30, 2024 04:56 PM EDT

Advancers

• Intel (INTC) shares notched the best performance in the S&P 500, soaring 9.5% following reports that the chipmaker is considering a possible spinoff or sale of its foundry business. According to Bloomberg, people familiar with the matter said Intel is exploring multiple options for the section of the company that makes semiconductors for other firms. However, it may take time for Intel to make a move, with board members likely to discuss the possibilities at their meeting in September.

• Shares of GE Vernova (GEV), the energy-focused business that spun off from General Electric in April, jumped 4.8% to an all-time high. Brokerage firm William Blair initiated coverage of the stock on Thursday with an “outperform” rating. According to analysts, the high demand for energy to power artificial intelligence (AI) technology will likely require more natural gas and natural gas turbines. GE Vernova is well-positioned to benefit from turbine service contracts.
• Western Digital (WDC) shares were up 4.1% on the day. Earlier this week, analysts at Citi boosted their sales estimates for solid-state drives, predicting favorable supply-and-demand dynamics. Western Digital also received approval this week for a project to expand hard disk production in Thailand.
• Shares of networking and IT services provider Hewlett Packard Enterprise (HPE) gained 3.7% ahead of the company’s upcoming earnings report, which is set for release on Wednesday afternoon. Following HPE’s most recent quarterly report in June, the stock surged to a record high, boosted by strong sales of AI-optimized servers.

Decliners

• Ulta Beauty (ULTA) shares dropped 4.0%, losing the most ground of any S&P 500 stock after the cosmetics retailer’s quarterly sales and profits came in below estimates. Ulta reported an unexpected decline in comparable store sales amid restrained discretionary spending and heightened competition. The makeup seller also reduced its full-year forecasts, noting market share challenges.
• Shares of oil and gas exploration firm APA Corp. (APA) sank 2.9% on Friday. Although APA beat quarterly sales and profit estimates in its most recent report, released at the end of July, the stock plunged following those results and has been trending downward since then. Last quarter’s strong performance reflected increased production following the acquisition of Callon Petroleum, which closed on April 1, and APA boosted its forecast for cost synergies while noting it was ahead of schedule with the integration.
• Super Micro Computer (SMCI) shares dropped 2.5%, extending steep losses posted earlier this week after the server and data storage firm said it would postpone its annual filing with the Securities and Exchange Commission (SEC). Supermicro’s move to delay its 10-K came a day after a report by activist investment firm Hindenburg Research flagged irregularities in the company’s accounting practices, particularly relating to revenue recognition processes.

–Michael Bromberg

A Bumpy Month for Stocks

August 30, 2024 03:59 PM EDT

The major stock indexes will finish August with gains for the month, but it was an awfully volatile ride along the way.

August got off to a shaky start, to say the least. The major indexes tumbled as soft manufacturing and jobs data raised concerns that the Federal Reserve had waited too long to start cutting rates and risked nudging the economy into recession. At the same time, a surprise rate hike from the Bank of Japan sparked the rapid unwinding of the yen carry trade, adding fuel to the U.S. equities sell-off. The Cboe Volatility Index (VIX) spiked to a 4-year high, and the S&P 500 shed more than 6% of its value, or nearly $3 trillion, in the month’s first three trading days alone.

Then, seemingly in the blink of an eye, the tide turned and stocks had their best week of the year as labor market concerns subsided and Wall Street mulled earnings reports, which showed corporate profits grew in the second quarter at their fastest rate since 2021.

But August’s rally looked very different than what came before it. The Magnificent Seven, which led the market for most of the last year and a half, have failed to fully recover from their longest slump in years. Meanwhile, Consumer Staples, Real Estate, and Healthcare were, in that order, the S&P 500’s best-performing sectors in August as investors, anticipating interest rate cuts, flocked to rate-sensitive stocks and dividend payers.

–Colin Laidley

Intel Rises on Report of Possible Foundry Business Sales

August 30, 2024 02:08 PM EDT

A report that Intel Corp. (INTC) is considering the spin-off or sale of its foundry business lifted the tech giant’s stock Friday.

Shares of Intel were more than 7% higher in recent trading following the Bloomberg report, which cited people familiar with the matter. An Intel spokesperson declined to comment.

Intel’s foundry business makes chips for outside companies. A move isn’t likely in the immediate term, however, with multiple options expected to be presented at a September board meeting, the report said.

The company said in early August it would lay off 15% of its workforce alongside disappointing quarterly results, which sent shares to their lowest level since 2013.

Intel stock is down 60% in 2024, making it the second-worst performing stock among the S&P 500 index.

–Andrew Keseel

Marvell Soars as AI Demand Boosts Earnings

August 30, 2024 12:29 PM EDT

Marvell Technology (MRVL) shares surged Friday after the maker of networking circuits posted better-than-expected quarterly sales, driven by demand for equipment to support artificial intelligence.

The company reported fiscal 2025 second-quarter revenue fell 5.1% from a year ago to $1.27 billion, slightly above estimates compiled by Visible Alpha. Marvell’s adjusted loss of 30 cents per share was in line with forecasts.

CEO Matt Murphy said the results were driven by AI demand, as the company saw “strong growth from our electro-optics products and our custom AI programs began to ramp.”

Murphy added that in the current quarter, “we expect our combined enterprise networking and carrier end markets to return to growth, while our data center end market growth accelerates.”

Marvell shares were up 9% recently, trading at a three-month high.

–Bill McColl

Major Indexes Poised to Finish August With Monthly Gains

August 30, 2024 10:35 AM EDT

After a rough start to the month, the Dow, S&P 500 and Nasdaq Composite have recovered from steep losses and are poised to finish August with monthly gains.

MongoDB Price Levels to Watch Amid Post-Earnings Surge

August 30, 2024 10:15 AM EDT

Shares in MongoDB (MDB) jumped in early trading Friday after the company reported better-than-expected earnings and boosted its full-year guidance amid robust demand for generative artificial intelligence software.

Amid post-earnings upside in MongoDB shares, investors should watch key chart levels at $294, $323, and $370.

During pullbacks, investors should monitor the $265 area, which will likely attract buying interest near the double bottom’s neckline.

Read our full technical analysis piece here.

–Timothy Smith

Futures Tied to Major Indexes Higher Ahead of Key Data

August 30, 2024 08:24 AM EDT

Futures tied to the Dow Jones Industrial Average were up 0.2%.

S&P 500 futures were up 0.5%.

Nasdaq 100 futures were up 0.8%.