Tuesday’s session marks the last day of June and the second quarter.
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New York Stock Exchange (NYSE) building is seen with the Fearless Girl Statue during Covid-19 pandemic in Lower Manhattan, New York City, United States on May 26, 2020.
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Stocks moved between gains and losses on Tuesday as a growing number of Covid-19 cases weighed on sentiment. But the major averages are still on pace to finish the quarter sharply higher. The Dow and S&P are on track to post their largest quarterly gains since 1998, while the Nasdaq is tracking for its best quarter since 2001.
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12:14 pm: Tesla jumps after Elon Musk email to employees leaks
Shares of Tesla jumped more than 7% on Tuesday, the morning after CEO Elon Musk sent an email to employees saying “Breaking even is looking super tight” for Q2. The e-mail, obtained by CNBC, did not make clear whether his break even comments were in reference to the company’s profit margin or another metric such as vehicle production numbers relative to estimates. Tesla is expected to report its second quarter vehicle production and deliveries numbers this week, before the 4th of July weekend. Shares of the electric vehicle maker have more than doubled this year, surging 158%. – Kolodny, Stevens
11:29 am: Nevada gaming revenue down 99% in May from prior year
The Nevada Gaming Control Board said in a press release that gaming revenue was down 99.4% statewide in May, including a 99.3% decline in the Las Vegas Strip district. Revenue is down more than 19% year to date for both the district and the state. Shares of major casino stocks, including MGM Resorts and Las Vegas Sands, were mixed on Tuesday. —Pound
11:06 am: Chip stocks just had their best quarter since the tech bubble
Shares of chipmakers have rebounded sharply from their first-quarter lows, and they’re on track for their best quarterly performance since the tech bubble. The VanEck Vectors Semiconductor ETF, which tracks the 25 biggest chipmakers, is up almost 30% in the second quarter, marking its best quarter since the fourth quarter of 2001 when the exchange-traded fund gained 41%. The top performers this quarter include ON Semiconductor, Teradyne and Marvell, which have all gained more than 50% during the past three months.
CNBC PRO subscribers can read more here. – Li
10:12 am: Boeing shares slide after Norwegian Air cancellation
Shares of Boeing slid more than 6% during early trading on Tuesday after Norwegian Air canceled orders for nearly 100 Boeing jets. Additionally, the airline plans to claim compensation for the grounding of its Boeing 737 Max jets. Shares of Boeing are down 43% this year. – Stevens
9:57 am: Inovio hasn’t provided critical data on its results, Stat says
Inovio Pharmaceuticals has not provided data needed to determine whether its vaccine is working, Stat, a medical news website reported Tuesday. The company put out a press release Tuesday morning claiming positive results in an early clinical trial, but it did not disclose how many patients produced antibodies that fight the coronavirus, the Stat report said. Inovio also said its vaccine candidate has been selected to participate in study as part of the government’s Operation Warp Speed, aimed at fast-tracking development of vaccines. Inovio stock is up nearly 800% year to date. It was down about 7% in trading on Wednesday morning. – Lewis
9:30 am: Stocks open last trading day of the quarter in the red
Stocks moved lower on Tuesday, the last trading day of the month, the quarter, and the first half of 2020. The Dow Jones Industrial Average shed 87 points, for a loss of 0.3%. The S&P 500 was down 0.10%, while the Nasdaq Composite slid 0.06%. Still, the record rebound from March’s low has the major averages on track for their best quarter in years. The Dow and S&P are on pace to post their largest quarterly gains since 1998, while the Nasdaq is on track for its best quarter since 2001. – Stevens
9:25 am: Investors must stay ‘cautious and selective,’ says portfolio manager
Katerina Simonetti, senior portfolio manager at UBS Private Wealth Management, said that with the number of Covid-19 cases rising, there’s considerable uncertainty in the market and investors therefore need to be “cautious and selective” going forward. She believes volatility will persist for several months, and that risk-averse investors should consider diversifying their portfolios by adding gold. “We see opportunities in companies that enable and benefit from digital transformation, e-commerce, fintech, genetic therapies and food. Companies in factory automation and robotics are also set to benefit, as industrial firms are planning to shorten global supply chains,” she said. UBS’ base case forecast sees the S&P 500 trading around 3,300 by December. – Stevens
9:07 am: Inovio shares slip despite promising drug trial results
Stock of Inovio Pharmaceuticals was down more than 12% in early morning trading after the biotechnology company said its coronavirus vaccine candidate showed positive results in early clinical trials. Additionally, its vaccine candidate, INO-4800, has been selected to participate in a non-human primate study as part of the government’s Operation Warp Speed, aimed at fast-tracking development of vaccines. Inovio stock is up more than 860% year to date. – Lewis
9:01 am: Goldman Sachs says a mask mandate could save economy from a 5% hit
Goldman Sachs told clients that a nationwide face mask mandate could both cut the daily growth rate of new confirmed cases of Covid-19, and also save the U.S. economy from taking a 5% GDP hit in lieu of additional lockdowns. Jan Hatzius, Goldman’s chief economist, said a national mask mandate could raise the percentage of people who wear masks by 15 percentage points and found that the rule could substitute for a lockdown that would subtract nearly 5% from GDP growth. — Franck
8:51 am: Conagra jumps following quarterly beat
Shares of Conagra Brands jumped more than 3% during premarket trading after the company’s fourth quarter results beat analyst estimates. The food producer posted a quarterly profit of 75 cents per share on an adjusted basis, which was nine cents ahead of estimates. Revenue also topped expectations, and the company gave upbeat guidance as the coronavirus pandemic has led to elevated demand. Shares have gained 19% in the last three months. – Stevens
8:07 am: Some banks stay silent on capital plans, dividends
On Monday night, major banks announced their dividend plans and stress capital buffers following the Federal Reserve’s stress test. However, some smaller banks have not reported their plans. PNC Financial has not filed an update with the Securities and Exchange Commission, according to the regulator’s website. Capital One reported its stress capital buffer but did not mention dividends in the press release. —Pound
7:49 am: Powell and Mnuchin to testify before the House Financial Services Committee
Federal Reserve chair Jerome Powell and Treasury Secretary Steven Mnuchin will testify before the House Financial Services Committee at 12:30 p.m. on Tuesday. The joint hearing will address the Fed and Treasury’s response to the coronavirus pandemic. In remarks prepared ahead of the hearing, Powell said that despite a recent uptick in economic activity as lockdown measures are eased across the world’s largest economy, the outlook is “extraordinarily uncertain” and will rely on both containing the virus and government support for the recovery. “A full recovery is unlikely until people are confident that it is safe to reengage in a broad range of activities,” Powell said. “The path forward will also depend on the policy actions taken at all levels of government to provide relief and to support the recovery for as long as needed.” –Li
7:46 am: Wells Fargo down, other banks move higher following capital plan announcements
Shares of Wells Fargo slipped 0.4% in premarket trading after the bank announced that it expected to announced a dividend cut next week. The banks that announced they were maintaining dividends, including JPMorgan Chase and Citigroup, trended higher on light trading volume, with JPMorgan shares rising 1.2%. —Pound
7:38 am: Biden tells donors he will scrap most of Trump’s tax cuts
Presumptive Democratic nominee Joe Biden told potential donors his administration would roll back many of President Donald Trump’s tax cuts, telling them “a lot of you may not like that.” “We have to think as big as the challenge we face. But this is America, there is nothing we cannot do if we do it together,” Biden said. “But I think the country is ready.” —Imbert
7:35 am: Market’s month & quarter in review
It’s the final trading day of June, and the final trading day of the second quarter. Here’s where the market stands.
- The Dow is up 0.84% this month, on pace for its third positive month in a row
- The Dow is up 16.78% this quarter, on pace for its best quarterly performance since the fourth quarter of 1998 when it gained 17.07%, and fifth positive quarter in six
- For the first half of 2020 the Dow is down 10.31%
- The S&P 500 is up 0.29% this month, on pace for its third positive month in a row
- The S&P is up 18.13% this quarter, on pace for its best quarterly performance since the fourth quarter of 1998 when it gained 20.87%, and fifth positive quarter in six
- For the first half of 2020 the S&P is down 5.5%
- The Nasdaq Composite is up 4.05% this month, on pace for its third straight positive month
- The Nasdaq Composite is up 28.23% this quarter, on pace for its best quarterly performance since the fourth quarter of 2001 when it gained 30.13%, and second positive quarter in three
- The Nasdaq Composite is up 10.05% for the first half of 2020
- The Russell 2,000 is up 1.95% this month, on pace for its third positive month in a row
- The Russell 2,000 is up 23.25% this quarter, on pace for its best quarterly performance since the first quarter of 1991 when it gained 29.37%, and second positive quarter in three
- The Russell 2,000 is down 14.82% this year
- Seven out of 11 sectors are negative for June, led to the downside by utilities. Tech is the best performer
- All 11 sectors are positive for the quarter, led by consumer discretionary, which is up 30.32% and on pace for its best quarterly performance ever
- For the year, nine out of 11 sectors are negative, led to the downside by energy, which has shed 38.38%. Tech is the top performer after gaining 12.06%. – Hayes, Stevens
7:30 am: Micron shares jump after earnings
Micron traded more than 5% higher in the premarket after the chip manufacturer posted better-than-expected results for the previous quarter. The company posted an adjusted profit of 82 cents per share, topping a Refinitiv estimate of 77 cents. Revenues rose to $5.44 billion, beating an estimate of $5.31 billion. Micron also issued better-than-expected revenue guidance for the current quarter. —Imbert
7:25 am: China says its manufacturing sector expanded in June
Chinas’s official Purchasing Manager’s Index came in at 50.9 for June, beating expectations and showing a growing sector. The expectation was for a reading of 50.4, according to economists polled by Reuters. In PMIs, readings above 50 represent expansion. A private survey PMI from Caixin and IHS Markit is scheduled to be released later this week. — Pound, Tan
7:20 am: FedEx rises ahead of earnings
Shares of FedEx rose 1% in premarket trading as the company prepares to release its fourth quarter earnings results after the market closes on Tuesday. According to consensus estimates from FactSet, analysts are expecting the company to earn $1.58 per share on $16.41 billion in revenue. In a recent note to clients UBS said it’s expecting a “very weak” report for the shipping company, although the firm still has a buy rating on the stock. “FDX’s potential for multi-year margin improvement and EPS growth can make it attractive to investors,” UBS said. Shares of FedEx are down 11% this year. – Stevens
7:20 am: Stock futures flat
Stock futures pointed to a flat open in early trading Tuesday following a strong rally in the previous session. Futures on the Dow Jones Industrial Average futures dipped 40 points, implying a loss of 10 points at the open. S&P 500 and Nasdaq-100 futures traded just below the flat line. Tuesday’s session marks the last day of June and the second quarter. Investors will monitor Federal Reserve chair Jerome Powell and Treasury Secretary Steven Mnuchin’s testimony before the House Financial Services Committee at 12:30 p.m.— Li
— CNBC’s Fred Imbert, Christopher Hayes, Thomas Franck, Al Lewis and Huileng Tan contributed reporting.
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