In a remarkable display of strength, the stock markets experienced another surge as the S&P 500 and Nasdaq reached fresh 15-month highs. Adding to the fervor, the NY FANG + Index also achieved a new record high. Microsoft (NASDAQ:MSFT) played a significant role in this rally by reaching an all-time high after unveiling its pricing strategy for a suite of AI tools tailored for enterprise use. Today, all eyes are on Netflix (NASDAQ:NFLX) and Tesla (NASDAQ:TSLA) as they prepare to announce their earnings after the closing bell. Here are four other important market news today.
Dock Workers Are on Strike Again
In the latest turn of events, the port strike in British Columbia has resumed, causing disruptions in port operations. The International Longshore & Warehouse Union, representing approximately 7,000 workers, voted against the tentative agreement that had ended the previous 13-day strike. With billions of dollars in trade at stake, this development may lead to potential government intervention and could further exacerbate the ongoing issue of inflation.
Food Prices Are Spiking Again
Food prices experience a sharp surge once again as crop prices soar. Wheat, corn, and soybean prices are rallying due to several factors, including Russia’s recent actions targeting the crucial export city of Odessa after abandoning its grain export deal with Ukraine. The record-breaking heatwave and insufficient rainfall across the globe also pose threats to crop yields. In the fertilizer sector, Nutrien (NYSE:NTR), which experienced a significant rally of four percent yesterday, continues to show positive momentum in pre-market trading. Having rebounded nearly 20 percent since reaching a two-year low in May, Nutrien’s stock received an upgrade from Scotia’s Ben Isaacson, who accurately predicted the upswing. The implications of these developments on the economy and the challenges they pose in mitigating rising food prices will be a topic of discussion.
Goldman Sachs Falls Short
For the second time in three quarters, Goldman Sachs has missed profit expectations. The bank reported a 58 percent drop in profit, accompanied by a 26 percent decline in fixed-income trading and weaker-than-anticipated investment banking revenue. Additionally, the bank incurred impairment charges of approximately US$1 billion due to goodwill writedowns associated with its real estate exposure. The decline in its return on equity places Goldman Sachs as the weakest performer among the top U.S. banks. Despite these results, the stock remains relatively unchanged in pre-market trading. These dynamics shed light on the current level of interest in U.S. financial institutions. Even PNC Financial, which issued a warning in its recent report, experienced a rally following its results. Since the beginning of bank earning season on Friday, the sector has witnessed a four percent surge and is approaching new bull market territory, with a rally of 19 percent from the May low. However, bank stocks are still down 25 percent from their levels prior to the Silicon Valley Bank episode.
AT&T Addresses Concerns
U.S. telecommunications companies faced significant pressure following a recent report by the WSJ, which highlighted the environmental risks associated with lead-coated cable networks deployed by these firms. AT&T (NYSE:T) reached a 30-year low, while Verizon (NYSE:VZ) hit a 13-year low. In response to the report, AT&T clarified that less than 10 percent of its national telecom network utilized lead-clad cables. As a result, both AT&T and Verizon have experienced a pre-market rally. AT&T, trading at five times earnings and offering an eight percent dividend yield (despite a dividend reduction last year), may be seen as a potential stock worth considering, as former market analyst Frances Horodelski used to suggest.
Featured Image: Freepik @ Drazen Zigic
