Global market decline amidst geopolitical and economic anxieties
The stock market commenced the week with a notable decline, with the S&P 500 falling 2.7% and the Nasdaq Composite decreasing by 3.2%. The Dow Jones Industrial Average saw a drop of 2.3%, and the Russell 2000 Index fell by 2.7%. All of the Magnificent Seven stocks experienced declines.
Last Friday’s lackluster job market figures continue to burden the market and invoke recession worries. The dip in the Nasdaq also signifies investors’ skepticism regarding the AI surge and uncertainties surrounding the upcoming election this year.
While the Olympics take place, the global market remains in the red, reflecting investors’ worries about geopolitical threats and global economic expansion. The FTSE 100 in London fell by 2%, while Europe’s Stoxx 600 benchmark decreased by over 2.5%, marking its largest three-day slide since June 2022. In Japan, the Nikkei index dropped by more than 12%.
US stocks fall amid fears of subdued growth.
Major stock movements and significant performances
Five S&P 500 stocks making notable midday changes are:
- Kellanova (K) +14.5%
- ON Semiconductor Corp (ON) +4.4%
- Tyson Foods Inc (TSN) +3.8%
- Dexcom Inc (DXCM) +3.8%
- Advanced Micro Devices Inc (AMD) +3.7%
The five underperforming S&P 500 stocks with the steepest midday declines are:
- Bath & Body Works Inc (BBWI) -6.4%
- Walgreens Boots Alliance Inc (WBA) -5.8%
- NVIDIA Corp (NVDA) -6.3%
- Intel Corp (INTC) -5.2%
- VeriSign, Inc (VRSN) -5.2%
Stocks worth mentioning with significant moves include:
- Tesla (TSLA) -3.4%
- Apple (AAPL) -4.1%
- Amazon (AMZN) -4.3%
- Coinbase Global (COIN) -6.5%
Nvidia shares traded 6.3% lower in the morning following potential delivery delays.
The chip giant informed its clients, including Microsoft, that a design issue was identified in the Blackwell architecture, which might postpone its production ramp and delivery timelines by approximately three months, as reported by The Information.
Deutsche Bank analyst Ross Seymore indicated that Nvidia has limited financial hazards in the short term concerning its upcoming earnings announcement on August 28, noting “still-strong demand” from its cloud clients. The analyst holds that the demand for artificial intelligence continues to be strong.
Apple shares fell by 4% after Berkshire Hathaway reduced its stake.
Warren Buffett’s conglomerate announced on Saturday that it divested almost half of its Apple shares during the second quarter.
The company offloaded .5 billion worth of stocks in that timeframe, including its top holdings, Apple and Bank of America. Berkshire’s cash reserves surged to a record 6.94 billion.
Buffett informed shareholders at Berkshire’s annual meeting in May that the company was trimming its stake in Apple due to significant capital gains. However, he also expressed his admiration for Apple’s operations.
Kellanova stock rose by 14% in morning trading, leading the S&P 500 amid the market decline.
Packaged food heavyweight Mars, recognized for brands like M&M’s and Snickers, is contemplating a potential acquisition of Kellanova, the maker of Cheez-It and Pringles, according to Reuters.
A source informed Reuters that it remains uncertain whether Kellanova will pursue a deal with Mars. Nonetheless, the acquisition would represent one of the largest transactions in the packaged food sector, considering Kellanova’s market valuation of about billion.
Stifel analyst Matthew Smith remarked that the deal would “further validate the strength of Kellanova’s brands and growth potential, both domestically and globally.” The analyst maintains a Hold rating on Kellanova shares.
