Despite a contradictory guideline from one of America’s biggest retailers and a negative opening, the U.S. stock market showed resilience and closed on the plus side of trading on Tuesday, June 7. The Dow Jones managed to add 0.8%. The S&P 500 and Nasdaq broad market index were up 0.95% and 0.94%, respectively.
Target spooked the Dow Jones at the open
Shares of U.S. retailer Target (TGT) fell 2.3% after the Minneapolis-based company reported an expected operating margin cut to 2% in the second quarter amid a program to reduce domestic inventory with additional discounts and reassess its costs
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A trader on the NYSE reacts to the rise in the Dow Jones index and ExxonMobil (XOM) stock. Photo: CNBC
At the same time, CEO Brian Cornell said that the company still expects revenue growth throughout the current year, and hopes to keep its market share at least, and at most to increase it
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But still fresh in the minds of investors are the events of May 18, when Target literally shocked the U.S. stock market by presenting its financial results for the first quarter of the year. TGT stock then plummeted 25%, marking its worst day in three decades. The company attributed the drop in revenue to heavy shipping and fuel costs and forced price reductions on a number of products.
So the sellers’ overhang in TGT has had an impact on other retailers’ stocks as well. Shares of Walmart (WMT), the largest U.S. retailer, were down 1.2%, and Home Depot (HD) lost 0.7%.
Although I find the flood on Target (TGT) to be not only overly emotional, but somehow inappropriate in general. Nothing bad was announced in principle. Moreover, management is promptly trying to solve not even the problem, but just the initial phase of it, which is quite commendable.
ExxonMobil and ConocoPhillips shares in the leaders of the S&P 500
Judging by the quotations of the oil companies’ shares, their investors are little frightened by the prospect not only of inflation and raising the Federal Reserve rates in connection with it, but also of any crisis in the U.S. economy in general. Oil futures contracts are steadily around $120 per barrel, which certainly adds to the investment “privileges” of the energy sector.
That is why there are three oil representatives among the five leaders of the S&P 500 index. ExxonMobil (XOM) has weighed in at 4.5% and reached a price tag of $103.37 amid Evercore’s first target price hike since 2014 from $88 to $120. Shares of the largest U.S. oil company by capitalization came close to their eight-year highs of $104.76.
On Topic: Don’t Catch the Bottom, Buy One Sector Where the Money Goes
Unlike Exxon, ConocoPhillips (COP) securities renewed their highs from 2014 back in January of this year and are now successfully engaged in an absolute renewal. COP’s share price reached $122.71, surpassing its 2014 high by nearly 44%. Chevron (CVX), where without it, is up 1.9%. EOG Resources (EOG) +3.42%. Not only oil companies but also oilfield service companies were successful: Schlumberger (SLB) +3.62% and Halliburton +2.93%.
Novavax received FDA approval
The committee of independent experts of the FDA (Food and Drug Administration) by a nearly unanimous decision (one abstention) finally approved a vaccine Novavax from coronavirus and recommended it for use, pleases investors biotech CNBC
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Trading in the company’s stock was suspended throughout the trading day, but it resumed in the post-market after hours. During the extra time, NVAX securities topped $58. Given Monday’s close of $47.54, we can assume the Maryland biotech company’s stock will open up more than 20 percent higher on the Nasdaq on Wednesday.