Stock News Update & Ratings Roundup for January 8th, 2024

Stock News

  • Federal Reserve and Labor Market: The US Federal Reserve notes the difficulty in achieving sustained labor market improvement despite closing the pandemic-induced “jobs hole.” While the economy has shown signs of healing from pandemic labor impacts, the Federal Reserve remains cautious, awaiting indications of stable wage and job growth.
  • Oil Price Decline: Oil prices witnessed a decline of over 4% due to significant price cuts by Saudi Arabia, the top oil exporter. Increased output by OPEC also contributed to the drop. Despite rising geopolitical tensions in the Middle East, concerns about oversupply led to a 4.2% decrease in Brent crude to $75.38 per barrel and a 4.7% fall in U.S. West Texas Intermediate crude futures to $70.29.
  • Alaska Airlines Boeing 737 MAX 9 Investigation: US investigators successfully recovered the “key missing component” from the Alaska Airlines Boeing 737 MAX 9 involved in an emergency landing. The plug door, covering an optional exit door, prompted the temporary grounding of 171 Boeing MAX 9 jets following an FAA order.
  • Automotive Sector: Honda is reportedly contemplating a $13.83 billion project for an electric vehicle (EV) plant in Canada, possibly including in-house battery production. Canadian leisure carrier Air Transat reached a labor contract agreement with its flight attendants’ union, avoiding potential operational disruptions due to a strike.
  • Lululemon Athletica’s Positive Outlook: Lululemon Athletica raised its fourth-quarter sales and profit forecasts, citing steady holiday demand and effective discount strategies. The sportswear company anticipates positive performance during the holiday season.
  • Nvidia’s China-Focused AI Chip: Nvidia plans to launch the H20, a China-focused AI chip, in Q2 2024 to comply with US export rules. The chip, designed to meet restrictions announced in October 2022, will initially have limited production volume with priority given to major customers.
  • Apple’s iPhone Sales in China: Apple’s iPhone sales in China reportedly fell by 30% in the first week of 2024. The decline, despite aggressive discounts, reflects growing competitive pressure from domestic rivals like Huawei in the Chinese smartphone market.
  • Metagenomi Technologies IPO: Genetic medicines company Metagenomi Technologies, backed by Bayer Healthcare and Moderna, has filed for an initial public offering (IPO) in the United States. The IPO filing comes amid positive market conditions and several firms preparing for listings in 2024.
  • VinFast Auto Leadership Change: Vietnamese electric vehicle maker VinFast appointed its founder and major backer, Pham Nhat Vuong, as CEO, planning an ambitious global expansion. Vuong will oversee operations, including production, sales, and marketing. VinFast also signed an agreement to establish manufacturing facilities in India.
  • Alaska Air Group Inc & Boeing Co Recovery: The US National Transportation Safety Board (NTSB) recovered a crucial component from the Alaska Airlines Boeing 737 MAX 9 involved in an emergency landing. The FAA temporarily grounded 171 Boeing MAX 9 jets using a similar panel. Indonesia also temporarily grounded three Boeing 737 MAX 9 planes operated by Lion Air.
  • Allison Transmission Holdings Inc Agreement: The United Auto Workers (UAW) union reached a tentative agreement with auto parts maker Allison Transmission, covering 1,500 workers in Indianapolis. The four-year contract includes a starting wage of $20 per hour, retroactive pay hikes, and bonuses.
  • Apple Inc’s iPhone Sales in China: iPhone sales in China dropped by 30% in the first week of 2024, contributing to a double-digit decline in China smartphone shipments. Aggressive discounts on various iPhone models did not prevent the decline, highlighting growing competitive pressures from domestic rivals like Huawei.
  • Berkshire Hathaway Inc and Pilot Settlement: Berkshire Hathaway and Pilot settled a Delaware lawsuit over the valuation of truck stop chain Pilot Travel Centers. The settlement averted a billion-dollar trial that was set to begin, determining the value of the Haslam family’s remaining 20% stake in Pilot Travel Centers.
  • BlackRock Inc’s Bitcoin ETF Fee: BlackRock set a fee of 0.30% for its planned spot bitcoin exchange-traded fund (ETF), lower than some competitors. The bitcoin ETF market has become competitive, with several participants vying for market share.
  • Boeing Co & Lockheed Martin Corp Lunar Landing Attempt: Astrobotic’s Peregrine lunar lander, launched by Boeing-Lockheed venture ULA’s Vulcan rocket, aims to achieve the first U.S. lunar soft landing since 1972. Boeing and Lockheed Martin are involved in this attempt, representing a milestone in space exploration.
  • General Motors Co’s Cruise Settlement Offer: Cruise, GM’s robotaxi unit, offered $75,000 to resolve an investigation by California regulators into its failure to disclose details of a pedestrian crash involving a self-driving car. Cruise aims to settle the dispute and enhance its reporting of collisions to the commission.
  • Honda Motor Co Ltd Electric Vehicle Plant: Honda is considering a $13.83 billion project to build an electric vehicle plant in Canada. The project may include in-house production of batteries, marking one of Honda’s largest investments. The company has been relatively slow in expanding electric vehicle sales.
  • Ligand Pharmaceuticals Inc’s Skin Infection Treatment Approval: Ligand’s topical treatment for the viral skin infection molluscum contagiosum, Zelsuvmi, received approval from the U.S. health regulator.

Top Analyst Ratings

  • Chevron Corp: Jefferies upgraded the rating to buy from hold, anticipating improved production growth in 2024.
  • Dell Technologies Inc: JPMorgan upgraded the rating to overweight from neutral, expecting the company to benefit from the AI-driven compute investment cycle.
  • Southwest Airlines Co: Bernstein downgraded the rating to underperform from market-perform and lowered the target price to $24 from $29, citing anticipated cost pressures impacting 2024 earnings negatively.
  • Target Corp: Bernstein increased the target price to $160 from $145, foreseeing benefits from the retailer’s ongoing investment in new stores.
  • Thermo Fisher Scientific Inc: Bernstein downgraded the rating to market-perform from outperform, citing various headwinds affecting revenue growth.
  • Barrick Gold Corp: Bernstein upgraded the rating to outperform from market-perform, expecting a gradual fall in interest rates to positively impact gold prices.
  • Capstone Copper Corp: National Bank of Canada raised the target price to C$8.25 from C$6.5, citing several transformational growth projects in the pipeline.
  • Constellation Software Inc: RBC increased the target price to C$3900 from C$3400, anticipating that the company’s continuous acquisitions will likely enhance its capital returns.
  • First Quantum Minerals Ltd: National Bank of Canada lowered the target price to C$15.5 from C$18, citing uncertainties surrounding the restart of the Cobra-Panama mine.
  • Lundin Mining Corp: National Bank of Canada raised the target price to C$13 from C$12, anticipating production growth and a robust operating outlook.

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