Semiconductor stocks surge as Nvidia leads dip-buying rally in tech
The recent dip in tech attracted dip buyers, particularly in semiconductor stocks, with Nvidia soaring more than 6% after Morgan Stanley said the recent dip in the chipmaker was a buying opportunity. The vote of confidence from Morgan Stanley comes even as concerns linger about bloated inventory and waning demand for chips amid an economic stumble in China. But rising demand for AI is likely to boost data center spending, Morgan Stanley adds, bolstering Nvidia’s growth.
U.S. 10-year Treasury yield drops ahead of consumer data release
The U.S. 10-year Treasury yield briefly jumped to 4.204%, its highest level since November 22, but those gains were short-lived as investors looked ahead to the latest consumer data due on Tuesday. The data for July is expected to show that the consumer remains resilient. Fresh signs of a strong U.S. consumer, which makes up about 70% of economic growth, would further dent bets that the Federal Reserve is unlikely to resume rate hikes later this year.
US Steel climbs after rejecting $7 billion buyout, PayPal names new CEO
United States Steel Corporation witnessed a sharp increase of over 30% after rejecting a more than $7 billion buyout offer from Cleveland-Cliffs Inc. The steel giant also announced plans to review strategic options. In a similar vein, PayPal Holdings appointed Alex Chriss, formerly of Intuit, as its new chief executive, replacing Dan Schulman. This leadership change is seen as significant, aligning with the company’s focus on repositioning both its merchant and consumer platforms.
Tesla shares slide as price cuts trigger concerns about EV market
Tesla announced price cuts for its Model Y electric vehicles in China, raising concerns about pressure on margins, which led to a drop of more than 2% in its shares. The move has sparked fears of a price war in the electric vehicle market and put pressure on other EV makers such as Rivian Automotive and Nikola.
Nikola temporarily halts EV sales following battery fire incidents
Following several battery fires, Nikola has decided to temporarily pause sales of its electric vehicles. The company recalled approximately 209 trucks after an investigation determined that a coolant battery leak was the likely cause of a fire at its Phoenix headquarters in June. The temporary halt in EV sales raises concerns about the safety and reliability of Nikola’s vehicles, highlighting the need for better quality control in the industry.
Semiconductor stocks saw a surge in the market as Nvidia led a dip-buying rally in the tech sector. The 10-year Treasury yield dropped as investors eagerly awaited the release of consumer data. The rejection of a $7 billion buyout offer boosted US Steel’s stock price, and PayPal named a new CEO to further its strategic goals. However, Tesla faced a decline in its shares due to price cuts, raising concerns about the competitiveness of the EV market. Moreover, Nikola temporarily halted EV sales following battery fire incidents, highlighting the issues surrounding safety and quality control in the industry.
Analyst comment
1. Semiconductor stocks surge as Nvidia leads dip-buying rally in tech – Positive news. Short-term market boost expected for semiconductor stocks, particularly Nvidia, as investor sentiment improves with dip buyers reentering the market.
2. U.S. 10-year Treasury yield drops ahead of consumer data release – Neutral news. Market reaction dependent on consumer data. If data shows strong resilience, it could negatively impact bets on the Federal Reserve keeping rates on hold.
3. US Steel climbs after rejecting $7 billion buyout, PayPal names new CEO – Positive news. US Steel’s stock price expected to rise further as strategic review increases potential for new opportunities. PayPal’s new CEO appointment aligns with company’s focus on revamping platforms.
4. Tesla shares slide as price cuts trigger concerns about EV market – Negative news. Tesla’s shares expected to face continued decline due to concerns about price cuts impacting margins and potential price war in the EV market.
5. Nikola temporarily halts EV sales following battery fire incidents – Negative news. Short-term market impact expected as concerns arise about the safety and reliability of Nikola’s vehicles, highlighting flaws in quality control.
