Markets News, March 8, 2024: Stocks Sink After Jobs Report; Chip Sell-Off Hits Nvidia (2024)

Equity Indexes Wrap: Semiconductor Stocks Plummet; Apple Snaps Longest Losing Streak in 2 Years

March 08, 2024 04:09 PM EST

The Dow

Shares of 3M (MMM) rose 1.4% after its board of directors approved a planned spin-off of its healthcare unit, Solventum.

Apple (AAPL) shares rose 1% to snap a seven-session losing streak, its longest string of losses in more than 2 years.

Intel (INTC) sank 4.7% after disappointing earnings forecasts from two peers brought this week’s chip rally to a grinding halt.

Boeing (BA) shares fell 2.2% after a United-operated 737 jet rolled off the runway in Houston.

The S&P 500

Cruise operators ticked up, led by Carnival Corp (CCL), which gained 4.6%. Royal Caribbean (RCL) and Norwegian Cruise Line Holdings (NCLH) rose 2.5% and 1.8%, respectively.

BlackRock (BLK) edged 0.5% higher after it announced plans to acquire SpiderRock in a bid to expand its wealth management business.

Eli Lilly (LLY) fell 2.4% after it said the release of its experimental Alzheimer’s drug would be delayed as the FDA looks more closely at its clinical trial results.

United Airlines (UAL) shares slipped 1.9% following the aforementioned incident in Houston.

Tesla (TSLA) also dropped 1.9% to a 10-month low.

The Nasdaq 100

Biogen (BIIB) gained 1.8%, boosted by the FDA’s decision to scrutinize competitor Eli Lilly’s Alzheimer’s drug.

Marvell Technology (MRVL) tumbled 11.4% after its first-quarter sales and earnings outlook fell far short of analyst estimates.

Costco (COST) slid 7.6% after its quarterly sales disappointed, overshadowing its earnings beat.

Broadcom (AVGO) shed 7% after reiterating its full-year guidance, disappointing markets that had high hopes for the chip giant after a run-up of its stock this year.

MongoDB (MDB) fell 6.9% after it, like Marvell, forecast lower-than-expected current-quarter and full-year earnings.

Other semiconductor stocks followed Marvell and Broadcom lower, including Nvidia (NVDA), down 5.6%, ASML Holdings (ASML), down 5.1%, and Qualcomm (QCOM), down 2.9%.

Eli Lilly's Alzheimer's Drug Release Delayed for FDA Investigation

March 08, 2024 03:29 PM EST

Shares of Eli Lilly & Co. (LLY) were down more than 2% Friday after the pharmaceutical company announced that the Food and Drug Administration (FDA) wants more information about its experimental Alzheimer’s treatment, donanemab, which will delay its release.

The company said the FDA expects to convene a meeting of the Peripheral and Central Nervous System Drugs Advisory Committee to look into the Phase 3 trial results of donanemab. It explained the committee would be discussing “the efficacy and safety of donanemab in early symptomatic Alzheimer's disease.”

Lilly added that the date of the advisory group meeting has yet to be determined by the FDA, so anticipated approval action by officials on donanemab won’t happen until after the first quarter.

The news boosted shares of Biogen Inc. (BIIB) Friday, because donanemab would be a rival to its own Alzheimer’s drug, Leqembi.Biogen was up 2.6% late in the session Friday.

Eli Lilly shares were down 2.2% at $763.00. Despite the decline, the stock has gained about 30% since the start of the year.

-Bill McColl

Gap Shares Gain on Q4 Earnings Beat Boosted by Namesake Brand, Old Navy

March 08, 2024 02:51 PM EST

Gap (GPS)shares gained over 4% in intraday trading Friday, after the apparel company posted higher-than-expected earnings during the holiday quarter, boosted by sales at its namesake brand and Old Navy.

Gap beat analyst estimates compiled by Visible Alpha for its top and bottom line. For the period that ended on Feb. 3, Gap posted net income of $185 million, or 49 cents per share, above forecasts. Revenue for the three months rose around 1% from a year earlier to $4.3 billion, also beating projections.

Comparable sales at Gap rose 4% over the same period a year earlier, while Old Navy's climbed 2%. Other brands didn't perform as well, as comparable sales dropped 4% for Banana Republic and 10% for Athleta.

Gap also surpassed full fiscal year 2023 estimates with $14.9 billion in total sales, though sales declined from fiscal 2022, in part because of the sale of its China unit.

Gap shares were up about 5.2% at $20.34 Friday afternoon. However, shares were still about 2.5% lower for the year.

-Aaron McDade

MongoDB Forecasts Loss of Some Business This Year, and Stock Tumbles

March 08, 2024 02:20 PM EST

MongoDB Inc. (MDB) shares slid Friday as the database platform provider for developers posted guidance that missed estimates, driven by the loss of some of its expected business.

The company said late Thursday that it anticipates current-quarter earnings per share (EPS) of 34 cents to 39 cents, and revenue in the range of $436 million to $440 million. It sees full-year EPS between $2.27 and $2.49, and sales of $1.90 billion to $1.93 billion. All were less than analysts’ forecasts.

MongoDB said that the outlook “reflects the impact of over $80 million of FY24 revenue, related to multi-year term licenses and unused Atlas commitments, that we do not expect to realize in FY25.” Atlas is a cloud-based database that handles deployments on cloud service providers Amazon.com Inc.'s (AMZN) AWS, Google's (GOOGL) Cloud, and Microsoft Corp.'s (MSFT) Azure.

Shares of MongoDB were down 5.7% Friday afternoon, but are still 70% higher than they were a year ago.

-Bill McColl

Broadcom Outlook Disappoints, Sending It and Semiconductor Peers Lower

March 08, 2024 01:29 PM EST

Shares of Broadcom (AVGO) tumbled Friday after the semiconductor giant disappointed investors with its full-year sales outlook.

Broadcom said it expects to book $50 billion in revenue in its 2024 fiscal year, reiterating guidance it first issued in December. That disappointed investors, who may have been looking for the company to raise its guidance after reporting better-than-expected revenue in the first quarter of the year.

Broadcom brought in $11.96 billion in revenue in the quarter ended Feb. 4., compared with estimates of $11.8 billion. Adjusted earnings of $10.99 per share represented a 66-cent increase from the year-ago quarter and beat Wall Street’s expectations.

The company’s revenue, which grew 36% year-over-year, got a boost from its recent acquisition of VMWare. Stripping out VMWares sales, revenue increased 11%.

“Strong demand for our networking products in AI data centers, as well as custom AI accelerators from hyperscalers, are driving growth in our semiconductor segment,” said CEO Hock Tan in the company’s earnings release.

Broadcom wasn’t the only chip company hurt on Friday by an earnings outlook investors deemed not quite good enough. Marvell Technology (MRVL) predicted adjusted earnings in its fiscal first quarter would be 23 cents per share, plus or minus 5 cents. That forecast fell short of Wall Street’s expectations and overshadowed a 54% increase in data center revenue.

The two reports weighed on semiconductor stocks on Friday. Broadcom shares traded 6.5% lower Friday afternoon, while Nvidia (NVDA), which has gained more than $1 trillion in market cap this year, fell 5.3%. Advanced Micro Devices (AMD), which competes with Nvidia for AI data center business, slipped 2%. Shares of companies that make the equipment required to fabricate semiconductors, like Applied Materials (AMAT) and Lam Research Corp. (LRCX), also fell Friday.

Bitcoin Kisses $70K, Its Second All-Time High This Week, Then Promptly Falters

March 08, 2024 12:45 PM EST

Bitcoin (BTC) hit another record Friday, briefly touching $70,000 on Coinbase before tumbling back down to under $67,000 and then rebounding to more than $68,000. It was the second all-time high and subsequent fumble this week for the largest cryptocurrency by market cap.

Bitcoin has been rallying this year as billions of dollars have flowed into spot bitcoin ETFs after the SEC in January approved 11 such funds. Investors are also anticipating an upcominghalving, a seminal event that generally results in the price of bitcoin going higher.

Deutsche Bank analysts expect risk appetite to increase when the Federal Reserve starts cutting interest rates, further bolstering the cryptocurrency.

"More investors will likely seek out higher-yielding alternative assets as treasury returns decline," Deutsche Bank's Marion Laboure and Cassidy Ainsworth-Grace wrote in a note on March 7. "This flow of capital into non-traditional investment classes like cryptocurrencies could further support an ongoing rally in digital currency prices."

-Christiana Sciaudone

Marvell Technology Stock Slips on Q1 Profit, Revenue Outlook

March 08, 2024 11:33 AM EST

Shares of Marvell Technology (MRVL) slid Friday after the maker of integrated circuits posted a weaker-than-expected first-quarter outlook as soaring demand for artificial intelligence (AI) chips didn’t offset declines in the rest of its businesses.

Marvell predicted first-quarter adjusted earnings per share (EPS) would be $0.23, plus or minus $0.05. That was well short of estimates. It sees revenue of $1.15 billion, plus or minus 5%, also missing forecasts.

In the fourth quarter, the company’s adjusted EPS was $0.46, with revenue increasing 0.6% to $1.43 billion. Both were more than anticipated.

Sales fell at four of its five units: enterprise networking (-28%), carrier infrastructure (-38%), consumer (-20%), and automotive/industrial (-17%). However, sales at its data center division, which includes its AI products,soared 54% to $765.3 million, making up 54% of Marvell’s total revenue.

Marvell Technology shares were down 9.4% to $77.10 late Friday morning but are up about 78% in the past year.

-Bill McColl

EV Maker Rivian To Halt Construction of $5 Billion Georgia Plant

March 08, 2024 10:51 AM EST

Rivian Automotive (RIVN) shares rose in early trading Friday after the electric vehicle (EV) startup said that it was halting construction of a $5 billion factory in Georgia.

The news of the halt came as the company also introduced on Thursday three new models to go along with its RT1 truck and RS1 SUV, as well as its EDV delivery van initially designed for Amazon (AMZN).

Rivian said total savings would be more than $2.25 billion from the halting of construction in Georgia. Its production of R2 mid-sized SUVs will now be moved to its existing plant in Illinois, it said.

Rivian initially announced plans to invest $5 billion in a second plant in Georgia in Dec. 2021. The factory was set to break ground this year and eventually produce up to 400,000 vehicles per year.

Rivian shares were up 3.7% at $12.98 Friday morning, but are down more than 40% since the start of the year.

-Fatima Attarwala

DocuSign Stock Jumps on Strong Earnings, Upbeat Sales Outlook

March 08, 2024 10:14 AM EST

DocuSign (DOCU) shares jumped more than 5% Friday morning after the e-signature and document management company topped analysts’ quarterly estimates and issued better-than-expected current-quarter and full-year sales outlooks as customers increased their IT spending.

The San Francisco-based company posted fiscal 2024 fourth-quarter adjusted earnings of 76 per share on revenue of $712.4 million, whereas Wall Street had expected earnings of 65 cents a share on sales of $698.3 million.

For the 2025 fiscal year, DocuSign expects revenue of between $2.92 billion and $2.93 billion, with the low-point of that band surpassing the Street expectation of $2.91 billion.

DocuSign's share price has oscillated roughly within a 20-point range over the past 17 months to form clearly identifiable areas of support and resistance. Although the 50-day moving average crossed back above the 200-day moving average in early January to generate a golden cross signal, the price has remained rangebound.

Amid follow-through buying after the company’s strong earnings report, keep an eye on the trading range’s top trendline around $64.50 as a potential resistance area. If a breakout occurs, monitor a prior countertrend high near $77 as the next possible level of chart resistance.

-Timothy Smith

Stocks Making the Biggest Moves Premarket

March 08, 2024 09:19 AM EST

Gains:

• DocuSign Inc. (DOCU): Shares of the e-signature software provider jumped about 10% after it reported better-than-expected quarterly earnings and issued upbeat sales outlooks.
• Gap Inc. (GPS): Shares of the apparel retailer rose more than 8% after its earnings topped Wall Street’s expectations.
• Rivian Automotive (RIVN): Shares of the electric truck maker rose 3% after it said it would halt production of a $5 billion factory in Georgia a day after unveiling three new models.
  

Losses:

• MongoDB Inc. (MDB): Shares of the database developer fell more than 6% after it offered disappointing current-quarter and full-year guidance, overshadowing its earnings beat.
• Marvell Technology Inc. (MRVL): Shares of the semiconductor company slid more than 3% after it also forecast lower-than-expected current-quarter earnings.
• Costco Wholesale (COST): Shares of the big-box retailer fell 3% after its quarterly sales came in below estimates, overshadowing its better-than-expected earnings.

Stock Futures Dip Ahead of Jobs Report

March 08, 2024 08:27 AM EST

Futures contracts connected to the Dow Jones Industrial Average were off 0.3% in premarket trading.

S&P 500 futures slipped a little more than 0.1%.

Nasdaq 100 futures traded 0.2% lower about an hour before markets opened.