Markets News, Feb. 23, 2024: Stocks Close Mixed to Cap Winning Week; Nvidia Briefly Tops $2T (2024)

Equity Indexes Wrap: Chip Rally Takes a Breather as Investors Take Profits, Buy Dips

February 23, 2024 04:14 PM EST

The Dow

Amgen (AMGN) led the index higher, climbing 1.4%.

Walgreens Boots Alliance (WBA) gained 0.7% on its last day as a Dow component. The pharmacy chain will be replaced by Amazon (AMZN) on Monday.

Apple (AAPL) led the index's laggards, falling 1%.

Shares of UnitedHealth Group (UNH) ticked up 0.2% despite it temporarily taking Change Healthcare, its prescription processing service, offline following a cyberattack.

The S&P 500

Etsy (ETSY) climbed 4.8% to rebound slightly from a sell-off yesterday after its fourth-quarter earnings came in below estimates.

Live Nation (LYV) rose 1.8% after reporting better-than-expected fourth-quarter sales amid strong demand for live events.

Nvidia (NVDA) pared early gains that took its market cap above $2 trillion and finished the session up 0.4%.

Booking Holdings (BKNG) tumbled 10.2% after warning that conflict in the Middle East and unfavorable currency conversions would weigh on gross bookings this year. Peer Expedia (EXPE) slid 2%.

Warner Bros. Discovery (WBD) shares fell 9.9% after reporting fourth-quarter earnings and sales that fell short of Wall Street’s estimates amid sluggish advertising and disappointing studio results. Peer Paramount Global (PARA) slid 4.3%.

Insulet (PODD) slipped 6.6% despite topping estimates with its quarterly earnings and sales.

The Nasdaq 100

Palo Alto Networks (PANW) rose 5.3%, continuing to rebound from Wednesday’s post-earnings sell-off. Cybersecurity peer ZScaler (ZS) advanced by 4%.

MercadoLibre (MELI) sank 10.4% after reporting that fourth-quarter earnings were flat compared with the year-ago quarter.

Chip stocks that got a boost from Nvidia’s earnings yesterday gave back some of those gains. Advanced Micro Devices (AMD) fell 2.9%, while KLA Corp. (KLAC) slid 2.2% and ASML Holding (ASML) dropped 2%.

Booking Holdings Warns About Effects of Middle East War, Currency Issues

February 23, 2024 03:37 PM EST

Booking Holdings Inc. (BKNG) warned that the war in the Middle East and currency fluctuations would negatively affect reservations and gross bookings, and its shares slumped about 10% Friday afternoon.

In prepared remarks after the closing bell Thursday, Chief Financial Officer (CFO) David Goulden told investors that the online travel site expects current-quarter room night growth to be in a range of 4% to 6%, and that “the ongoing war in the Middle East to have a negative 1% impact" on it.

He added that full-year gross bookings are anticipated to be up “slightly faster than 7%,” while analysts had been anticipating a gain of 9.9%. Goulden pointed to the effects of the war and unfavorable currency rates for the miss.

Shares of Booking Holdings hit an all-time high before earnings Thursday, and even with Friday’s declines they are still up about 44% year-over-year.

-Bill McColl

4 Key Takeaways From Reddit's IPO Filing

February 23, 2024 02:50 PM EST

Reddit filed for an initial public offering (IPO) on the New York Stock Exchange (NYSE) to trade under the symbol “RDDT" this week. The company first pursued going public inlate 2021.

Thursday's filing with the Securities and Exchange Commission (SEC) offered insight into Reddit's financials and business; its investments in cryptocurrency; artificial intelligence (AI) pioneer and OpenAI CEO Sam Altman's investments in the company; and shares reserved for the platform's users.

See here for four takeaways from the filing.

-Naomi Buchanan

MercadoLibre Stock Sinks as Fourth-Quarter Earnings Fall Flat

February 23, 2024 01:55 PM EST

Shares of MercadoLibre (MELI) tumbled Friday after the Latin American e-commerce giant reported disappointing fourth-quarter earnings.

MercadoLibre reported a net income of $165 million, or $3.25 per share, the same as in the year-ago quarter. Revenue, meanwhile, increased almost 42% to $4.26 billion. Unique active users in the last three months of the year totaled 145 million, a 49% increase from 2022, and gross merchandise volume rose 40% to $13.45 billion.

The company said operating income of $240 million—down from $349 million a year prior—was negatively impacted to the tune of $351 million by one-off expenses related to Brazilian tax liabilities. If those expenses, which the company said would “not have a material cash impact,” were excluded, operating income would total $572 million, the company said. That would give it an operating margin of 13.4%, a 270 basis point increase from the same quarter a year ago.

MercadoLibre shares, which had been on a tear since November, were down about 9.4% at $1,646 Friday afternoon, bringing their 12-month return to about 44%.

Carvana Stock Surges After Reporting First Annual Profit, Bullish Outlook

February 23, 2024 01:14 PM EST

Carvana (CVNA) shares soared after the online used-car retailer posted its first annual profit and said it expects improved earnings this quarter as it cut both costs and debt.

The company reported a net income of $150 million for 2023, compared with a loss of about $2.89 billion a year earlier. The company also forecast adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) "significantly above$100 million."

CEO Ernie Garcia wrote in a letter to shareholders that the company slashed $1.1 billion in annualized selling, general, and administrative (SG&A) expenses last year. Carvana also renegotiated loan agreements with most of its term bondholders to reduce its debt and cut prices to clear excess inventory.

Carvana recorded a per-share loss of $1 for the fourth quarter, narrowed from a loss of $7.61per share the previous year.

Carvana shares were trading 31% higher at $68.83 Friday afternoon, and are up almost 600% in the past year.

-Bill McColl

SPY Become First ETF to Surpass $500B in Assets

February 23, 2024 12:39 PM EST

State Street’s SPDR S&P 500 ETF Trust (SPY) surged to a record high on Thursday and in the process became the first exchange-traded fund (ETF) to surpass $500 billion in assets under management.

The ETF’s total assets increased 2.7% yesterday to end the session at $502.3 billion, according to State Street.

SPY was the first U.S. ETF to trade on a national exchange when it launched in January 1993. Today, there are more than 3,000 ETFs listed on U.S. exchanges with about $8 trillion in assets. In the fourth quarter of 2023, ETF trading averaged more than $160 billion a day and accounted for more than 30% of all equity volume.

Block Stock Surges on Surprise Quarterly Profit and Guidance Beat

February 23, 2024 11:41 AM EST

Shares in Block (SQ) surged Friday morning after the payments fintech posted a surprise quarterly profit and better-than-expected current-quarter and full-year outlook on expectations of growth in its Cash App business and benefits reaped from cost-cutting initiatives.

The Oakland, California-based company posted fourth-quarter net income of 2 cents per share, which compares to a loss of 93 cents a share in last year’s corresponding quarter. Analysts had expected the company to disclose a loss of 1 cent a share.

Looking ahead, the company said it projects adjusted earnings to range between $570 million and $590 million in the current quarter, with the lower end of that forecast coming in comfortably above analysts’ modeling at $511.76 million. For the full year, the company expects to generate an adjusted profit of $2.63 billion, above Wall Street’s expectation of $2.40 billion.

In early January, Block's 50-day moving average crossed up above its 200-day moving average to form a golden cross buy signal. More recently, the price has consolidated between the two closely watched indicators in the lead-up to the company’s earnings report.

In the days ahead, it’s worth keeping an eye on the $80 level—an area that may provide resistance from a trendline connecting several prominent swing highs over the past 18 months. A volume-backed breakout above this key resistance region could mark the start of a new trend higher.

-Timothy Smith

Intuitive Machines Stock Soars After Spaceship Makes Historic Moon Landing

February 23, 2024 10:49 AM EST

Intuitive Machines (LUNR) shares skyrocketed in early trading Friday after the commercial space startup’s lander made a historic moon landing.

The Houston-based company's spacecraft—named Odysseus after the mythological Greek hero—landed Thursday night, with the firm posting on social media platform X (formerly known as Twitter) that the spaceship was “upright and starting to send data.”

The landing marks the first time a U.S.-made spaceship has touched the moon’s surface in one piece since 1972 when NASA completed the final Apollo astronaut visit.It is also the first time a private firm has successfully landed an intact spacecraft on the moon.

Intuitive Machines shares were trading 22.6% higher at $10.28 Friday morning, and have more than tripled in value so far this year.

-Nisha Gopalan

Nvidia Market Cap Tops $2T

February 23, 2024 10:00 AM EST

Nvidia (NVDA) shares rose over 4% at the open, propelling its market capitalization above $2 trillion.

Nvidia’s path to $2 trillion has been 25 years long, but the first trillion was the hardest. The company went public in January 1999 and it took it more than 24 years to climb to $1 trillion, which it reached last May. The climb from $1 trillion to $2 trillion took just 270 days.

Nvidia’s stock price has more than tripled in the last year amid booming demand for artificial intelligence and, subsequently, the advanced semiconductors in which Nvidia specializes.

Nvidia is just the fourth U.S. company to touch $2 trillion. Apple (AAPL), which closed above $2 trillion on Aug. 20, 2020, was the first to get there. It was followed by Microsoft (MSFT), which crossed the threshold on June 22, 2021. Google Parent Alphabet (GOOGL) briefly got there on Nov. 8, 2021, but it has never closed above $2 trillion.

The only other company in the world to have achieved such a high valuation is Saudi Aramco, the state-owned national oil company of Saudi Arabia.

Stocks Making the Biggest Moves Premarket

February 23, 2024 09:06 AM EST

Gains:

• Intuitive Machines Inc. (LUNR): Shares of the space exploration company soared 40% after its lander, Odysseus, successfully touched down on the surface of the moon, becoming the first U.S.-made lander to do so in more than 50 years.
• Carvana Co. (CVNA): Shares of the used-car seller jumped 25% after it reported its fourth-quarter loss narrowed from a year ago. It also said it would achieve $100 million in EBITDA this year.
• Block Inc. (SQ): The fintech’s shares gained 15% after it reported a surprise profit in the fourth quarter and offered an upbeat full-year outlook, citing growth in its Cash App business and the benefits of cost-cutting measures.
  

Losses:

• Warner Bros Discovery Inc. (WBD): Shares tumbled 10% after the entertainment company reported a larger-than-expected loss and disappointing revenue in the fourth quarter.
• MercadoLibre Inc. (MELI): Shares slumped more than 8% after the Latin American e-commerce giant reported lower-than-expected profit following two one-off tax charges, overshadowing a 42% increase in revenue.
• Booking Holdings Inc. (BKNG): Shares of the online travel services company fell 7% after its current-quarter gross bookings and profit guidance fell short of expectations, overshadowing its fourth-quarter earnings beat.
  

Index Futures Inch Up From Record Highs

February 23, 2024 08:29 AM EST

Futures contracts connected to the Dow Jones Industrial Average were up 0.1% in premarket trading on Friday.

S&P 500 futures also tacked on 0.1%.

Nasdaq 100 futures were little changed about an hour before markets opened.