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Futures

Stock Futures Little Changed After S&P 500, Nasdaq Hit New Highs

2024-12-04

On Wednesday night, U.S. stock futures exhibited relatively stable trends following a remarkable day in the stock market. The Dow Jones Industrial Average futures dipped by 18 points, equivalent to 0.04%, while S&P 500 futures slid by 0.08% and Nasdaq-100 futures declined by 0.1%. In extended trading, retailer American Eagle faced a significant setback, with its stock plummeting more than 13% after the company provided a weak forecast for the holiday quarter. In contrast, discount retailer Five Below witnessed a remarkable surge of around 14% on the heels of an excellent third-quarter report. During Wednesday's trading session, the three major averages achieved solid gains, with the S&P 500 and the Nasdaq Composite setting new closing records. The Dow Jones Industrial Average also closed above 45,000 for the first time.Tony Pasquariello, the global head of hedge fund coverage at Goldman Sachs, expressed optimism on CNBC's "Closing Bell" on Wednesday. He stated, "I think there's still gas in the tank as we move through December and into 2025. I still think it is a bull market. I still think the primary trend is higher. If we're right on growth, if we're right on the Fed, if we're right on technology, the raw ingredients would argue for the rally to continue."This sentiment comes as an ADP report released earlier on Wednesday showed that private payrolls grew less than expected in November. For the month, companies added 146,000 jobs, falling short of the 163,000 positions expected by Dow Jones economists. Investors are now eagerly awaiting key economic data to be released this week. Initial jobless claims data for the week ending Nov. 30 is scheduled to be released on Thursday at 8:30 a.m. ET, and nonfarm payrolls data for November is due out on Friday morning.Federal Reserve Chair Jerome Powell also made significant remarks during an onstage interview at The New York Times' DealBook Summit on Wednesday. He stated that the U.S. economy is strong enough for the Fed to move carefully on rate cuts. "The labor market is better, and the downside risks appear to be less in the labor market. Growth is definitely stronger than we thought, and inflation is coming [out] a little higher. So, the good news is that we can afford to be a little more cautious as we try to find neutral," he said.Fed funds futures trading indicates a 78% likelihood that the central bank will trim rates by a quarter point at its Dec. 17-18 meeting. However, they imply a nearly 64% probability that policymakers will hold steady in January, according to the CME FedWatch tool.Meanwhile, several earnings reports are scheduled to be released Thursday before the bell, including Dollar General, Signet Jewelers, and Kroger. Hewlett Packard Enterprise and Ulta Beauty will report in the afternoon.American Eagle's Plunge after Revenue MissShares of American Eagle Outfitters witnessed a sharp decline of 13% in extended trading on Wednesday. This came after the retailer's third-quarter revenue failed to meet Wall Street's expectations. The company's revenue reached $1.29 billion, while analysts surveyed by LSEG had expected $1.30 billion. However, the company did manage to exceed earnings expectations, posting adjusted earnings of 48 cents per share compared to the consensus estimate of 46 cents per share.In addition to the revenue miss, American Eagle provided a weak holiday forecast and cut its full-year outlook. It now expects comparable sales to grow by 3% for the full year, which is below both its previous guidance of 4% growth and the consensus estimate of 4.1% according to FactSet. Revenue growth for the full year is also expected to be 1%, falling short of its previous guidance of 2% to 3%. Although the stock has gained more than 7% in the past month, it has been in the red this year, posting year-to-date losses of about 3%.— Gabrielle Fonrouge, Sean ConlonStocks Making the Biggest Moves after HoursHere are the stocks making headlines in extended trading:Five Below – The discount retailer witnessed a significant advance of about 11% after posting third-quarter revenue of $844 million, which was well above the $799 million expected by analysts surveyed by LSEG. Adjusted earnings also surpassed the Street's expectations. The company also provided a fourth-quarter revenue range that encompassed the average consensus estimate.Synopsys – The stock fell more than 6% after the company's fiscal first-quarter forecast came in lower than analysts' expectations. Synopsys expects earnings to be between $2.77 and $2.82 per share, significantly below the $3.53 per share predicted by analysts according to LSEG. The company also guided for first-quarter revenues that were lower than consensus, forecasting between $1.435 billion and $1.465 billion in the quarter. Analysts surveyed by LSEG were looking for $1.631 billion.Read here for the full list.— Sean ConlonStock Futures Open Little ChangedU.S. stock futures remained just below the flatline on Wednesday night. Futures tied to the Dow Jones Industrial Average lost 16 points, or 0.04%. Additionally, S&P 500 futures inched lower by 0.07%, and Nasdaq 100 futures fell 0.1%.— Sean Conlon

Investors have been closely observing the economic indicators and statements from Federal Reserve Chair Jerome Powell. His remarks have had a significant impact on the financial markets. The S&P 500 Futures saw a slight fall to 6,095.50 points, while the Nasdaq 100 Futures dropped 0.1% to 21,515.50 points by 18:53 ET (23:53 GMT), and the Dow Jones Futures steadied at 45,099.0 points. Powell stated that the economy is in a better position than it was in September when the Fed began cutting interest rates, enabling the Fed to be more cautious in considering further easing. At a New York Times event, he also highlighted the progress made in bringing down inflation, although his comments suggested support for a slower pace of rate cuts. These are likely to be his last public statements before the Fed's meeting on December 17 and 18, where a 25-basis-point interest rate cut is widely expected.

Uncertainty in the Long-Term Outlook

Markets are facing uncertainty in the long term due to the resilience of the U.S. economy, which could keep inflation sticky. President-elect Donald Trump's protectionist trade policies are also expected to have a long-term impact on inflation. However, investors have latched onto the prospect of a stronger economy, leading to broad-based gains across Wall Street. They were relieved that Powell did not downplay the possibility of a December cut. The focus now is on the upcoming nonfarm payrolls data for November, which is due on Friday. This reading is expected to show resilience in the labor market and will likely influence the outlook for U.S. interest rates.

Wall Street's Recent Performance

Wall Street indexes reached record highs on Wednesday, driven by a persistent rally in major technology stocks. Salesforce Inc (NYSE:CRM) surged 11%, which was a key driver of gains. Market darling NVIDIA Corporation (NASDAQ:NVDA) also saw a sustained rally. The S&P 500 rose 0.6% to a record high of 6,086.49 points, while the NASDAQ Composite rose 1.3% to a peak of 19,732.87 points. The Dow Jones Industrial Average ended up 0.7% at a record high of 45,014.04 points. Since Trump's election victory in early-November, Wall Street has been on a tear, and analysts expect more gains as 2024 draws to a close. The positive earnings from Salesforce and the sustained rally in NVIDIA have contributed to the overall upward trend. Investors are closely monitoring these trends and their implications for the future of the market.

Charlottesville, Virginia is buzzing with the efforts of the Cav Futures Foundation as they gear up for a second year of their remarkable Champions of the Community program. This initiative aims to bridge the gap and open up a world of opportunities for both student athletes and the local community.

Empowering Student Athletes and the Community through Grants

Connecting UVA Student Athletes with Charlottesville Nonprofits

The Champions of the Community program serves as a vital link between UVA student athletes and Charlottesville-area nonprofits. Executive Director Lo Davis emphasizes the importance of this connection, stating, "By creating this, it really allows our student athletes to take a look at what's happening here in Charlottesville with their local nonprofits. This not only grows the opportunities but also lays the foundation for long-term success, enabling them to serve wherever their paths take them."

Nonprofits in Charlottesville or Albemarle County have the chance to apply for grants, and student athletes get to actively participate in the selection process. Through the Leadership Academy, students are learning about grant making and philanthropy, and they are using these skills to make valuable recommendations. This collaborative approach ensures that the grants are distributed to the most deserving nonprofits.

Inaugural Year Success and Upcoming Opportunities

In its first year, the program was a resounding success, awarding more than $130,000 to 13 nonprofits. This significant financial support has made a tangible impact on the local community. Now, with the applications open and set to close on January 23, there is renewed excitement and anticipation.

The recipients will be announced in late April, and the grants will be distributed in early May. This timeline allows for a thorough selection process and ensures that the funds reach the organizations that need them most. It's a time of hope and growth for both the nonprofits and the student athletes involved.

If you have a story idea or a news tip, don't hesitate to send it our way. We're here to bring you the latest updates and highlights from the Cav Futures Foundation's Champions of the Community program.