Stocks ended lower Tuesday, retreating from the previous session's record high close, as chipmakers slipped into the red.
The Dow Jones Industrial Average fell 324.80 points, or 0.75%, to end the session at 42,740.42, while the S&P 500 lost 0.76% to close at 5,815.26, and the tech-heavy Nasdaq sank 1.01% to finish the day at 18,315.59.
Chipmakers ASML, Nvidia and AMD all finished lowered.
Updated at 12:27 PM EDT
Fading gains
A mixed bag of earnings, and a sharp slump in oil prices, has stocks moving lower into the afternoon session, with the Dow falling 102 points and the S&P 500 down 22 points, or 0.4%. The Nasdaq was last marked 147 points, or 0.8% lower.
"When the market is repeatedly pushing to new highs, it’s easy to forget that even the strongest trends can experience pauses or setbacks," said Chris Larkin, managing director for trading and investing at E*Trade from Morgan Stanley.
"While earnings will likely play a big role in determining whether the S&P 500 gains ground for a sixth-straight week, the market has sometimes exhibited a little exhaustion, at least temporarily, after five up weeks in a row," he added.
UBS: “.. We are adjusting our year-end 2024-25 S&P 500 targets to 5850 and 6400, from 5600 and 6000, 9.2% upside through YE 2025.
— Carl Quintanilla (@carlquintanilla) October 15, 2024
“.. These forecasts are based on EPS estimates of $240, $257, and $275 for 2024-26, implying 9.1%, 7.1% and 7.0% growth.” $SPX 🇺🇸 pic.twitter.com/Ya6Harue5J
Updated at 9:38 AM EDT
Some new highs
The S&P 500 was marked 5 points higher, or 0.02%, in the opening minutes of trading, with the Nasdaq rising 44 points, or 0.24%.
A big decline in UnitedHealth is weigh on the Dow, which was marked 256 points lower, while the mid-cap Russell 2000 slipped 4 points, or 0.18%.
S&P 500 Opening Bell Heatmap (Oct. 15, 2024)$SPY +0.08%🟩$QQQ +0.16%🟩$DJI -0.30%🟥$IWM -0.61%🟥 pic.twitter.com/KLJn0LzjSP
— Wall St Engine (@wallstengine) October 15, 2024
Updated at 9:16 AM EDT
You sending the Wolf?
Wolfspeed (WOLF) shares soared higher in heavy premarket volume after the EV chipmaker secured $1.5 billion in new funding
Wolfspeed received $750 million from the 2022 Chips and Science Act and a similar amount in separate financing from a group of private investors lead by Apollo Global.
Shares in the Durham, North Carolina-based group, which trade on the New York Stock Exchange, were marked 29.44% higher in premarket dealing to indicate an opening bell price of $14.72 each.
$WOLF (+25.5% pre) Biden administration to provide $750 million to North Carolina-based Wolfspeed for advanced computer chips - CNBChttps://t.co/cUkSXUhRP0
— Open Outcrier (@OpenOutcrier) October 15, 2024
Updated at 8:10 AM EDT
Chipped
Nvidia shares edged lower in early trading, leading a broader decline in the chip sector, following a report from Bloomberg News that suggested the Biden administration was mulling a cap on overseas semiconductor sales.
Bloomberg said the plans could include a ceiling on export licenses to countries that are deemed a national security risk, including countries in the Persian Gulf.
Nvidia shares slipped 0.65% in the premarket and were last pegged at $137.15, while Advanced Micro Devices (AMD) fell 1.06% and Micron (MU) dipped 0.52%
(Bloomberg) US WEIGHS CAPPING EXPORTS OF AI CHIPS FROM NVIDIA AND AMD TO SOME COUNTRIES: Officials reviewing AI chip policy with focus on Middle Easthttps://t.co/CpYnkqyqWA
— Ivan the K™ (@IvanTheK) October 15, 2024
Big scoop by BBG. This interview was a tell from four months ago with @JoumannaTV 👇 https://t.co/4yGJEDUa8c
Updated at 7:44 AM EDT
Gold men (and women)
Goldman Sachs shares powered higher in early trading after the investment bank posted a huge increase in third-quarter profit thanks in part to a surge in fees from its dealmaking division.
The bank said earnings for the three months ended in September rose 53% from last year to $2.99 billion, or $8.40 per share, well ahead of Wall Street's $6.86 forecast, as revenues hit $12.7 billion. Investment banking fees, Goldman said, rose 20% to $1.87 billion.
Goldman Sachs shares, a Dow component, were last marked 3.7% higher in premarket trading to indicate an opening bell price of $542.
Updated at 7:10 AM EDT
UnitedHealth slides after Q3 report
UnitedHealth Group shares slumped in premarket trading after the health insurance giant posted stronger-than-expected third-quarter earnings but noted a surge in overall medical costs.
UnitedHealth said its medical loss ratio jumped 3 percentage points from a year earlier to 85.2%, topping Wall Street forecasts. Its payouts increased thanks in part to higher health care demand and lower reimbursements from Medicare.
The group still posted overall revenue of $100.8 billion, an 8.55% increase from a year earlier, as well as a Wall-Street-beating bottom line of $7.15 a share.
United Health shares were marked 3.5% lower in premarket trading to indicate an opening bell price of $584.
Check back for updates throughout the trading day
Stocks powered to another record high on Monday, with the S&P 500 recording its 45th all-time peak of the year as the benchmark extended its 2024 advance to around 22.9%, thanks in part to solid gains from megacap tech names such as Nvidia (NVDA) and Apple (AAPL) .
The Dow Jones Industrial Average also closed north of the 43,000 point mark for the first time, with the benchmark riding gains tied to the energy and industrial sectors.
Focus Tuesday will likely shift back to bank earnings, with a trio of lenders slated to update prior to to the opening bell, led by Goldman Sachs (GS) , one of the top banking stock performers of the year.
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Goldman is likely to see a 25% increase in its third-quarter bottom line, which is forecast at $6.89 per share, thanks in part to a surge in investment banking fees.
Citigroup (C) and Bank of America (BAC) , meanwhile, will likely post modest earnings declines from a year earlier, with investors looking keenly at the lenders' forecasts for net interest income and loan delinquency rates heading into the final months of the year.
Johnson & Johnson (JNJ) , as well as UnitedHealth Group (UNH) , will also publish third-quarter updates before the opening bell.
Markets will also be tracking a big move lower in global oil prices, tied in part to a report from the Washington Post that Israel will refrain from hitting energy targets in Iran as part of its planned retaliatory strikes later this month.
Related: What's next for S&P 500 returns as rally enters third year
The International Energy Agency also warned of a potential glut in global supplies, tied in part to weakening China demand, following yesterday's lower-than-expected growth forecasts from the OPEC cartel.
Brent crude futures contracts for December delivery, the global pricing benchmark, tumbled $3.47 to change hands at $73.89 per barrel, while WTI contacts for November slumped $3.42 to trade at $70.41 per barrel heading into the New York session.
On Wall Street, futures contracts tied to the S&P are priced for a modest 1 point opening bell decline, with the Nasdaq called 33 points lower and the Dow likely to gain around 75 points at the start of trading.
More Wall Street Analysts:
- Analysts update Meta stock price target with Q3 earnings in focus
- Analysts update outlook for Nvidia's Blackwell chips amid AI boom
- Analyst reboots Reddit stock price target ahead of earnings
In overseas markets, Europe's Stoxx 600 benchmark slipped 0.14% in early Frankfurt dealing, while Britain's resource-heavy FTSE 100 fell 0.41% in London.
Overnight in Asia, Japan's Nikkei 225 rose 0.77% as markets returned from Monday's Sports Day holiday. Stocks in China slumped following another vague update on stimulus from government officials, pulling the regional MSCI ex-Japan benchmark 0.7% lower into the close of trading.
Related: Veteran fund manager sees world of pain coming for stocks
