Hello readers,
Stock futures are ticking higher, pointing to continued gains on the last day of trading for the first half of the year. The Federal Reserve's preferred inflation report is due this morning, and investors are digesting impacts of last night's presidential debate, with Donald Trump's Trump Media & Technology up 6% in premarket trading. On Thursday, the S&P 500 and Nasdaq Composite rose for a third straight session, continuing a long stretch of calm in the markets. 🚨 Follow our live coverage throughout the day for the latest news affecting markets. Meanwhile, our Karen Langley reports on the unending AI fervor propelling the stock market.
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Stocks to Watch:
- Nike: The sneaker company reported an unexpected quarterly sales drop and cut its revenue outlook for the year, citing lighter store traffic and China's sluggish economy. Shares slid 14% before the bell.
- Under Armour, Puma & JD Sports: Nike's results knocked other sportswear stocks. Under Armour fell 2.5% premarket, while Puma lost nearly 3% in Frankfurt. Shares in U.K. retailer JD Sports dropped 4% in London.
- Walgreens Boots Alliance: Shares of the pharmacy chain remained under pressure in premarket trading. The stock had tumbled 22% on Thursday, after Walgreens reported weak earnings, cut its outlook, and said it plans to shutter many stores.
- Infinera: Finland's Nokia agreed to buy Infinera in a $2.3 billion deal, as it deploys more resources in its optical-networks business. Infinera stock jumped about 19% ahead of the opening bell.
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AI Frenzy Propels Stocks to Monster First Half By Karen Langley
The AI fervor powering the stock market shows no sign of cooling down. Much as in 2023, investors piled into bets in the first half of this year that the artificial intelligence boom is just getting started. They sent Nvidia shares soaring 150%, propelling the graphics-chip maker’s market value above $3 trillion and briefly making it the most valuable company in the world. Nvidia’s ascent is a big reason the S&P 500 has climbed 15% this year — nearly as much as in last year’s standout first half — even as a series of hot inflation readings damped investors’ hopes that the Federal Reserve would soon begin to cut interest rates. Keep reading.
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Charting the Markets
- High interest rates have had an unexpected impact on U.S. housing. Instead of triggering a fall in home prices, costlier mortgages have pushed residential values higher thanks to the “lock-in” effect of ultracheap mortgages keeping owners stuck in their homes, writes Heard on the Street's Carol Ryan.
- Big banks saw a bigger hit on this year’s Federal Reserve stress test, with a key capital ratio dropping 2.8 percentage points in a “severely adverse” scenario modeled by the Fed. The silver lining: it may not slow them down as much as in the past, writes Heard on the Street’s Telis Demos.
- It’s tough times for one of America's biggest pharmacy chains. The drug-store giant Walgreens Boots Alliance's shares plummeted 22% after its quarterly earnings missed Wall Street expectations and its CEO disclosed plans to close many of its U.S. stores.
Must Reads
- The Supreme Court's 6-3 decision affecting the SEC split the court along ideological lines. PHOTO: TIERNEY L. CROSS/BLOOMBERG NEWS The Supreme Court on Thursday limited the ability of the Securities and Exchange Commission and other federal agencies to impose monetary penalties in a blow to regulators across the U.S. government.
- Investment bank Jefferies posted a sizable jump in some key parts of its business in its latest quarter, triggering a surge in its share price—and likely previewing some optimism across Wall Street.
- If you really want to get more dollars into your Roth IRA or Roth 401(k), you may need to take lesser-known paths to get around roadblocks, writes Laura Saunders
More: How Nike Missed the Boom in Running Culture, Bill Gates on His Climate Investments: The Early Winners and Long Shots, As Chinese Stocks Struggle, Owning Boring Ones Has Paid Dividends
This Day in Markets
📈 On this day in 2001, the U.S. Court of Appeals for the District of Columbia shot down portions of a blockbuster ruling that Microsoft was an illegal monopoly.
Beyond the Newsroom
Buy Side from WSJ: Does Turning Off Your A/C When You’re Not Home Actually Save Money?
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