Stocks Rebound Amid Nvidia Chip Unveiling, BOJ Rate Hike

Equity Indexes Wrap: Nvidia Climbs on AI Chip Unveiling; Semiconductor Competitors Slump

3 hr 20 min ago

The Dow

McDonald’s (MCD) climbed 1.5% after it said CEO Chris Kempczinski would become the company’s chairman in May, taking over from Enrique Hernandez, who is retiring. 

Apple (AAPL) advanced 1.4%, rising for a second day following reports yesterday the company was in talks to license Google’s Gemini to power generative artificial intelligence programs in its next-generation operating systems. 

Microsoft (MSFT) added 1% after it named Google’s DeepMind co-founder Mustafa Suleyman to lead its new consumer AI unit. 

Disney (DIS) rose 0.6% after “Star Wars” creator George Lucas threw his weight behind the company’s current CEO Bob Iger in his proxy battle with activist investor Nelson Peltz.

JPMorgan Chase (JPM) ticked up 0.6% after it announced the creation of a sports-focused investment banking group. 

Intel (INTC) fell 1.6%, following several other Nvidia competitors lower a day after it kicked off its annual GPU tech conference. 

The S&P 500

International Paper (IP) jumped 11% after the company named Andrew Silvernail to the role of CEO effective May 1. 

Homebuilders D.R. Horton (DHI) and Builders FirstSource (BLDR) rose 3% and x2.3%, respectively, after data showed U.S. homebuilding and permitting activity surged in February. 

Nvidia (NVDA) rose 1.1%, rebounding from earlier losses as analysts and investors mulled the slew of product and partnership announcements it made yesterday.  

Kroger (KR) ticked up 0.5% after it said it planned to sell its specialty pharmacy business to Elevance Health (ELV). Elevance shares rose 0.9%. 

Super Micro Computer (SMCI) tumbled 9% after it said it was seeking to sell 2 million additional shares to raise capital. 

The Nasdaq 100

Synopsys (SNPS) rose 4.3% after Nvidia said it was integrating its automation software into its lithography platform to accelerate the production of next-generation chips. 

Cadence Design Systems (CDNS) and Ansys (ANSS), which also got shoutouts from Nvidia CEO Jensen Huang in his keynote Monday, rose 3.6% and 2.1%, respectively. 

Chipmakers Advanced Micro Devices (AMD) and Marvell Technology (MRVL) slid 4.8% and 3.2%, respectively, in the shadow of Nvidia’s product unveiling on Monday. 

Other semiconductor stocks to slip included Qualcomm (QCOM), down 1.7%, and Texas Instruments (TXN), down 1.5%.

Gildan Activewear Stock Jumps Amid Reports of Potential Buyout

4 hr 26 min ago

Trading in shares of Gildan Activewear (GIL) was paused on Tuesday after the stock jumped following reports the board was exploring selling the company. 

According to the Globe and Mail, Gildan received a takeover offer from a potential buyer, which prompted the board to have advisors Goldman Sachs and RBC Capital Markets gauge interest among other potential buyers. Gildan shares jumped more than 10% Tuesday afternoon before trading was paused.

A spokesperson told Bloomberg that the company had set up a special board committee to consider a sale after several buyout candidates “expressed an interest in considering a potential friendly transaction.”

The move comes amid a battle for control of the company between the current board and a group of institutional investors led by Browning West LP. Gildan’s board ousted co-founder and CEO Glenn Chamandy in December, replacing him with former Fruit of the Loom executive Vince Tyra.

Browning West is currently seeking to have five nominees elected to Gildan’s board and have Chamandy reinstated as CEO. It has accused the company’s current directors of intentionally delaying a special meeting the firm requested to vote on those nominees, demonstrating “a complete disregard for sound corporate governance and a total lack of respect for the will of the shareholders.”

Gildan has said the shareholder meeting date was set for May 28, 2024, rather than in March as Browning West requested, to “provide shareholders with an opportunity to assess CEO Vince Tyra’s leadership of the Company so they can make the most informed decision about whom they assess is the best executive to lead Gildan,” among other reasons.

Disney Gains as George Lucas Backs Iger

5 hr 33 min ago

Disney (DIS) shares rose on Tuesday after “Star Wars” creator George Lucas expressed support for Bob Iger in his fight with activist investor Nelson Peltz. 

Lucas received 37.1 million shares as part of Disney’s acquisition of LucasFilm in 2012, and is currently the company’s largest individual shareholder, according to CNBC. 

“I remain a significant shareholder because I have full faith and confidence in the power of Disney and Bob’s track record of driving long-term value. I have voted all of my shares for Disney’s 12 directors and urge other shareholders to do the same,” he said in a statement to CNBC on Tuesday. 

Lucas joins JPMorgan Chase CEO Jamie Dimon and proxy advisory firm Glass Lewis, who have also thrown their support behind Iger.

Activist investor Nelson Peltz is engaged in his second proxy battle with Disney in as many years, having first attempted to shake up the company in late 2022. He has asked investors to nominate himself and former Disney chief financial officer Jay Rasulo to the company’s board of directors at its annual meeting on April 3. 

Iger is in the middle of a major overhaul of the entertainment giant, which he returned to as CEO in November 2022 after a brief retirement. His initiatives include billions of dollars in cuts to content spending amid a major effort to turn the Disney+ streaming service profitable, a joint sports-streaming service with Fox (FOXA) and Warners Bros Discovery (WBD), and major investments in the company’s theme parks. 

Disney shares were up 0.8% at $114.76 Tuesday afternoon. They have gained about 27% so far this year.

Nvidia’s Name Dropping Boost Three Software Stocks

6 hr 45 min ago

Shares in chip and computing system design software company Cadence Design Systems (CDNS) gained Tuesday following remarks from Nvidia CEO Jensen Huang during his keynote address at the firm’s annual GPU tech conference. Huang gave Cadence a shoutout during his speech, noting the software design firm is building a supercomputer with Nvidia’s chips.

Shares in software automation software maker Synopsys (SNPS) also got a boost after Nvidia announced that the company is integrating its software with its computational lithography platform to accelerate the manufacturing of next-generation semiconductor chips. “Computational lithography is a cornerstone of chip manufacturing,” Huang said.

Engineering software maker Ansys (ANSS) announced Monday evening that it plans to increase its collaboration with Nvidia to develop next-generation simulation solutions powered by accelerated computing and generative AI in areas such as accelerated computing, 6G communication systems, AI-infused simulation solutions, and autonomous vehicles. In addition, Nvidia will use Ansys solutions to optimize its hardware and provide the company with its new Blackwell AI chips.

Shares of Synopsys and Cadence were up more than 3% Tuesday afternoon, while Ansys stock rose nearly 2%. All three were among the five best-performing stocks in the Nasdaq 100 midday Tuesday.

–Timothy Smith

Super Micro Computer To Raise $2 Billion in Equity Sale, Shares Sink

7 hr 21 min ago

Super Micro Computer (SMCI) shares tumbled in early trading Tuesday after the company announced it would offer an additional 2 million shares to raise $2 billion.

The company said “the principal purposes of this offering are to obtain additional capital to support our operations, including for the purchase of inventory and other working capital purposes, manufacturing capacity expansion and increased [R&D] investments,” according to a Securities and Exchange Commission (SEC) filing.

The equity sale announcement comes after Super Micro Computer led losses in the S&P 500 on Monday, its first day of inclusion in the index.

Super Micro Computer shares were down 9.9% at $902 early Tuesday afternoon. Despite this week’s losses, the stock has more than tripled in value since the start of 2024.

–Naomi Buchanan

MicroStrategy Slumps as Bitcoin Falters

7 hr 53 min ago

Shares of MicroStrategy (MSTR), the software company that has bet big on Bitcoin, tumbled Tuesday as cryptocurrencies slumped following a major run-up in prices last week. 

MicroStrategy on Tuesday announced in an SEC filing that it had purchased about 9,245 bitcoins at a cost of approximately $623 million. Most of the purchase was financed by the sale last week of senior convertible notes, through which MicroStrategy raised $592 million. 

It is the company’s second bitcoin buying spree financed by convertible debt in the last month. Between February 26 and March 10, the company purchased about 12,000 bitcoins for nearly $822 million. 

With its most recent purchases, MicroStrategy owns about 214,246 bitcoins, acquired at an aggregate cost of $7.5 billion and purchased at an average price of $35,160 per bitcoin. Its holdings now represent more than 1% of the possible bitcoin supply, which is capped at 21 million. 

Bitcoin slumped to about $63,500 on Tuesday morning after surging to a record high of nearly $74,000 last week. MicroStrategy shares followed crypto lower, tumbling more than 12% in intraday trading. 

Semiconductor Stocks Slumps Following Nvidia’s New Product Unveiling

8 hr 51 min ago

High-flying semiconductor stocks were brought back down to earth on Tuesday as markets digested the unveiling of Nvidia’s (NVDA) next-generation AI chips and chip architecture. 

Nvidia on Monday announced the Blackwell platform, the latest version of its AI-powering technology.

“The inference capability of Blackwell is off the charts and in fact it is some 30 times Hopper,” Nvidia’s existing AI platform, said CEO Jensen Huang in his keynote address at the company’s annual GPU technology conference (GTC). Running a generative AI large language model on the Blackwell architecture offers about 25 times the energy efficiency of running the same model on Hopper, the company said. 

Nvidia also unveiled the GB200 Grace Blackwell Superchip, a “massive super chip” that “connects two NVIDIA B200 Tensor Core GPUs to the NVIDIA Grace CPU.” 

Analysts were generally encouraged by the announcements. Bank of America reiterated its buy rating on the stock “following slew of product/partner announcements at flagship GTC conference that continues to fundamentally widen NVDA’s competitive moat in a multi $Tn+ IT/Infrastructure service industry.”

Wedbush analysts said the company “continues to lift the performance bar, a result that should help sustain is [sic] leadership position in the AI accelerator market.”

But expectations were incredibly high. The stock gained nearly 80% between the start of the year and Monday’s close, and had more than tripled in value over the prior 12 months. Nvidia shares were down about 2% Tuesday morning, and weighed on semiconductors peers. Advanced Micro Devices (AMD), a major Nvidia competitor, tumbled more than 6%, while the iShares Semiconductors ETF (SOXX) slipped about 2%.

Unilever Stock Rises on Plan to Spin Off Ice Cream Division, Including Ben & Jerry’s

9 hr 36 min ago

Shares of Unilever Plc (UL) rose in early trading Tuesday after the consumer products giant announced plans to separate Ben & Jerry’s and its other ice cream brands such as Magnum into a stand-alone business, as part of a restructuring that could affect around 7,500 jobs.

The splitting out of the ice cream business will make the company “simpler, more focused,” it said, leaving it to operate in four business groups: Beauty & Wellbeing, Personal Care, Home Care and Nutrition.

The multinational said its ice cream division recorded revenue of 7.9 billion euros ($8.6 billion) in 2023.

Unilever said it expects higher margins following the separation of the ice cream division. “Post separation, Unilever aims to deliver mid-single digit underlying sales growth and modest margin improvement,” it said.

American Depositary Receipts (ADRs) of Unilever were up 2.7% at $49.85 early Tuesday morning.

–Fatima Attarwala

Stocks Making the Biggest Moves Premarket

10 hr 17 min ago

Gains:

• XPeng Inc. (XPEV): American depositary receipts of the Chinese electric vehicle maker climbed more than 3% after it reported a narrower-than-expected quarterly loss.
• Unilever Plc (UL): Shares of the British consumer goods company rose 3% after it said it would spin off its ice cream unit as part of a broad restructuring.
• Synopsys Inc. (SNPS): Shares rose about 1% after Nvidia CEO Jensen Huang said the chipmaker was using Synopsys software to accelerate manufacturing of its next-generation semiconductors. 

Losses:

• Super Micro Computer Inc. (SMCI): Shares of the IT solutions and services provider tumbled 10% after it said in a regulatory filing it would offer 2 million additional shares to raise capital.
• MicroStrategy Inc. (MSTR): Shares of the software company fell almost 10% after tumbling 15% yesterday as the price of Bitcoin, in which MicroStrategy has a sizable stake, pulled back after running up to a record last week. 
• Nvidia Corp. (NVDA): Shares of the AI chip maker fell about 2% after unveiling its new Blackwell chip infrastructure and new advanced semiconductors for AI.

Stock Futures Slip as Fed Meeting Begins

11 hours ago

Futures contracts connected to the Dow Jones Industrial Average were off 0.2% in premarket trading on Tuesday.

S&P 500 futures fell 0.5%.

Nasdaq 100 futures traded about 0.7% lower an hour before markets opened.