U.S. markets were sharply higher near noon, rebounding from yesterday's declines as both the S&P 500 and Nasdaq were up over 1% each, with the Dow just under 1% higher. The broad increases come after U.S. jobless claims data and after yesterday's release of minutes from the last Federal Reserve meeting, in which the Fed said the U.S. economy is "far from" maximum employment. Concerns remain around a run of strong inflation data from China, U.S. and the Eurozone over the past few weeks, and that surging inflation will prompt the Fed to taper and raise rates sooner than previously anticipated.
ECONOMIC EVENTS: In the U.S., initial jobless claims fell 34,000 to 444,000 in the week ended May 15. The U.S. leading index rose 1.6% to 113.3 in April, a new all-time high and stronger than expected.
TOP NEWS: Cisco (CSCO) shares were fractionally higher near noon after the company reported better-than-expected third quarter earnings and revenue and provided guidance for the fourth quarter. Of note, the company said that supply chain issues resulted in additional costs in Q3.
In other earnings news, Ralph Lauren (RL) shares fell over 7% even after the company reported upbeat quarterly results and guided for revenue growth in the current quarter. Of note, the company reinstated its quarterly dividend, which was previously suspended due to the COVID-19 pandemic.
In non-earnings news, shares of Lordstown Motors (RIDE) were 9.5% lower after Wolfe Research analyst Rod Lache downgraded the stock to Underperform from Peer Perform and slashed his price target on the shares to $1 form $18. The analyst said that Ford's (F) electric F-150 reinforces his view that Lordstown will not be competitive in the commercial electric vehicle pickup space. Lache, who was already questioning the competitiveness of Lordstown's $52,500 electric pickup truck for fleets, believes Ford's reveal of $39,900 and $49,900 electric pickups crystalizes his concerns.
In other auto news, Bloomberg reported last night that Waymo, Alphabet's (GOOGL) autonomous driving subsidiary, is holding talks with outsider investors about raising as much as $4B in additional capital for R&D efforts, with the company also having discussed the possibility of going public.
Meanwhile, Robinhood (HOOD) announced that it is starting to roll out IPO Access, a new product that will give users the opportunity to purchase shares of companies at their IPO price, before trading on public exchanges.
MAJOR MOVERS: Among the noteworthy gainers was Virgin Galactic (SPCE), which rose 9.2% after announcing that the next rocket-powered test flight of SpaceShipTwo Unity will be conducted on May 22, pending weather and technical checks. Also higher was Hormel Foods (HRL), which gained 7.5% after reporting quarterly results.
Among the notable losers was Black Diamond Therapeutics (BDTX), which declined almost 34% after presenting Phase 1 data for BDTX-189. Also lower were Triumph Group (TGI) and Kohl's (KSS), which fell a respective 11% and 10.4% after reporting quarterly results.
INDEXES: Near midday, the Dow was up 248.86, or 0.73%, to 34,144.90, the Nasdaq was up 210.74, or 1.58%, to 13,510.48, and the S&P 500 was up 42.34, or 1.03%, to 4,158.02.
Cisco
+0.46 (+0.88%)
Ralph Lauren
-8.35 (-6.38%)
Lordstown Motors
-1.05 (-9.20%)
Ford
+0.335 (+2.77%)
Alphabet
+44.39 (+1.92%)
Alphabet
+35.745 (+1.57%)
Robinhood
+
Virgin Galactic
+1.585 (+9.19%)
Hormel Foods
+3.63 (+7.90%)
Black Diamond Therapeutics
-7.08 (-31.88%)
Triumph Group
-1.875 (-11.40%)
Kohl's
-6.36 (-10.56%)