Oil Futures, Stocks Tumble as Saudi Arabia Slashes Prices
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Oil futures plummeted Monday after Saudi Arabia cut prices for February shipments of crude oil as it contends with robust global supply.
West Texas Intermediate futures contracts fell 4% Monday to trade at less than $71 a barrel. Brent crude, the European benchmark, fell a little over 3% to trade around $76.
State-owned Saudi Aramco cut prices on its Arab Light Crude by $2 a barrel for Asian customers, its largest market. It also lowered prices for deliveries to Europe and North America. While analysts had expected prices to be lowered, Monday’s cuts were larger than expected.
The move comes as oil demand in Asia moderates and ample oil enters the market despite a series of production cuts by Saudi Arabia and its OPEC+ allies. In particular, U.S. oil, which was being pumped at record rates at the end of 2023, has helped keep a cap on oil prices even amid mounting geopolitical tensions that risk disrupting supply and trade.
Shares of some of the world’s largest oil companies were sharply lower Monday. ExxonMobil (XOM) lost about 2% while Chevron (CVX) dipped about 1%.
Apple Shares Climb After Vision Pro Launch Date Is Set for Feb. 2
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Apple Inc. (AAPL) shares climbed during intraday trading on Monday after the iPhone maker announced a launch date early next month for its Vision Pro virtual reality (VR) headset.
The spatial computer headset will launch in the U.S. on Feb. 2, with preorders opening on Jan. 19. It will cost $3,499, with prescription lens add-ons costing $149.
The Vision Pro could allow Apple to compete with Meta’s (META) Quest 3 headset, which held 55% market share for VR headsets in the third quarter of 2023, according to IT market intelligence firm International Data Corp.
Jefferies Group securities analysts project that Apple will capture just 4% of VR headset market share, with around 400,000 units shipped in 2024. The firm noted that Vision Pro is to be sold at a higher price point than other comparable headsets like the Meta Quest 3, which starts at about $500.
Apple shares were up nearly 2% Monday afternoon.
Nvidia Stock Hits Record as It Unveils AI PC Chips
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Nvidia (NVDA) on Monday unveiled three new graphics processing units (GPU) designed to power artificial intelligence on personal computers, adding to its suite of market-leading AI chips.
The GeForce RTX 40 SUPER Series, announced today ahead of the 2024 Consumer Electronics Show in Las Vegas, “deliver up to 836 trillion operations per second, bringing transformative AI capabilities to gaming, creating and everyday productivity.”
The company also said major computer manufacturers, including Dell, HP, and Samsung, were releasing AI GPU-equipped laptops, “bringing a full set of generative AI capabilities to users right out of the box.”
The announcement comes as Nvidia, the leading supplier of AI chips to data centers, seeks to expand its AI offering and fend off competitors eager to grow their slice of the massive AI pie.
Advanced Micro Devices (AMD), one of Nvidia’s fiercest competitors, unveiled AI PC chips of its own on Monday. It said its Ryzen 8000G Series chips are the first PC processors to contain a dedicated AI neural processing unit. Intel (INTC) preempted both Nvidia and AMD when, in December, it launched its set of AI PC chips.
Chipmakers were among the S&P 500’s best-performing stocks Monday. Nvidia shares were more than 4.5% Monday afternoon, while AMD rose more than 5%. Intel shares traded more than 3.5% higher.
Boeing Shares Plummet After FAA Grounds 737 MAX 9 Fleet
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Boeing (BA) shares tumbled in early trading Monday after the Federal Aviation Administration (FAA) temporarily grounded certain Boeing 737 MAX 9 aircraft for inspections.
The FAA’s directive comes after an incident Friday in which an Alaska Airlines (ALK) Max 9 lost a panel mid-flight, forcing an emergency landing. About 171 Boeing aircraft in the U.S. or operated by U.S. airlines outside the U.S. are impacted by the FAA’s investigation to address potential door safety issues before resuming flights.
“We agree with and fully support the FAA’s decision to require immediate inspections of 737-9 airplanes with the same configuration as the affected airplane,” Boeing said in a statement.
Shares of Boeing were down 6.8% at $232 per share midday Monday but remained up about 13% in the last year.
Crocs Shares Jump on Record Sales Forecast
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Shares of Crocs (CROX) jumped 20% Monday morning after the casual shoemaker said full-year sales would exceed its prior guidance after a strong holiday season.
The company said in a statement that it expects sales to grow 1% year-over-year in the fourth quarter, surpassing its November forecast of sales declining between 1% and 4%.
Subsequently, the company estimated that full-year sales would total about $3.95 billion, a record and a more than 11% increase year-over-year. The company had previously forecast full-year sales growth of between 10% and 11%.
Despite Monday’s gains, Crocs shares have lost about 8% of their value in the last year and remain well off their record high of about $180.
One Chart to Watch Monday: Berkshire Hathaway
5 hr 2 min ago
Warren Buffet-run Berkshire Hathaway (BRK.B) may appear on watchlists Monday after the multinational conglomerate settled a billion-dollar lawsuit with the Haslam family over a truck stop company.
A trial scheduled to commence today in Delaware was to determine if Berkshire Hathaway had used pushdown accounting methods to significantly reduce the value it would have to pay for the family’s remaining 20% stake in Pilot Travel Centers (PTC), the largest truck-stop operator in the U.S. Berkshire had alleged that Cleveland Browns owner Jimmy Haslam enticed senior PTC executives with side payments to inflate the value of the company to receive a more attractive buyout from the financial conglomerate.
Berkshire has been increasing its stake in PTC from the Haslam family since 2017, taking majority ownership of the company in January last year.
Source: TradingView.com.
Berkshire Hathaway shares trended mostly higher throughout 2023 apart from several retracements to the 200-day moving average. Currently, the stock trades between a 15-month uptrend line and its all-time high (ATH). If the price moves higher from current levels, monitor how it responds to the ATH around $373. Conversely, during retracements, keep an eye out if buyers can defend the uptrend line and 200-day moving average, currently sitting near $351.
See here for more charts to watch today.
Stocks Making the Biggest Moves Premarket
5 hr 52 min ago
Gains:
- Crocs Inc. (CROX): Shares of the shoemaker jumped 8% after it said it expected revenue in 2023 to total $3.95 billion, a record and more than analysts estimated.
- DoorDash Inc. (DASH): Shares of the meal delivery service rose more than 3% after Jefferies upgraded the stock to “buy” from “hold,” citing cost controls and its strong market position.
- Dell Technologies Inc. (DELL): Shares of the computer hardware maker rose 2% after analysts at JPMorgan upgraded to stock to “overweight,” citing the likelihood the company’s server business will benefit from AI investment.
Losses:
- Boeing Co. (BA): Shares of the aircraft maker fell more than 7% after U.S. regulators grounded more than 170 of its 737 Max 9 jets following an incident in which part of an Alaska Airlines plane’s fuselage detached mid-flight. Shares of its supplier Spirit AeroSystems (SPR) tumbled 14%.
- Regeneron Pharmaceuticals Inc. (REGN): Shares of the drugmaker fell more than 2% after it said it sold $1.34 billion of its blockbuster eye drug Eylea in the fourth quarter, nearly $200 million less than Wall Street expected.
- ExxonMobil Corp. (XOM): The oil giant’s shares fell more than 1% as oil prices tumbled in early trading.
Futures Mixed as Boeing Drags on the Dow
6 hr 37 min ago
Futures contracts connected to the Dow Jones Industrial Average were more than 0.3% lower in premarket trading on Monday, weighed down by Boeing.
S&P 500 futures were little changed about an hour before markets opened.
Nasdaq 100 ticked up about 0.2%.