GlobalFoundries Stock Pops on AI Chip Designer Acquisition
38 minutes ago
GlobalFoundries (GFS) stock jumped Tuesday after the contract chip manufacturer agreed to acquire artificial intelligence and processor IP supplier MIPS.
The companies did not disclose the purchase price.
Shares of Malta, N.Y.-based GlobalFoundries rose nearly 7% in recent trading to rank among the biggest gainers in the Nasdaq 100. For the year to date, the stock is down about 3%.
“This acquisition will be a powerful step forward to push the boundaries of efficiency and performance across a broad range of applications in automotive, industrial and datacenter infrastructure,” GlobalFoundries president and COO Niels Anderskouv said.
The deal is expected to close in the second half of 2025. San Jose, Calif.-based MIPS would continue to operate as a standalone business upon closing.
Goldman, BofA Raise Year-End S&P 500 Targets
1 hr 14 min ago
Wall Street continued to look past tariff uncertainty on Tuesday, with analysts at two major firms lifting stock market price targets they slashed just months ago.
Bank of America analysts, led by Savita Subramanian, on Tuesday raised their year-end S&P 500 target to 6,300, implying a 1% gain for the index through the remainder of the year. BofA entered 2025 with a target of 6,666—one of the highest on Wall Street—but cut its forecast to 5,600 after President Donald Trump’s “Liberation Day” tariff announcement roiled markets.
“The resiliency of large companies in the face of macro uncertainty leads us to lower our equity risk premium (ERP) assumption,” Subramanian said. The firm’s ERP estimate—down to 200 basis points (bps) from 250 bps—is well below the post-Global Financial Crisis average of 540 bps, “but a lower ERP is justified today given the index’s shift toward a higher-quality, more asset-light index.” That is, tech companies with healthy balance sheets, high margins, and strong cash flows make up more of the index now than in the past.
Goldman Sachs’ David Kostin lifted the firm’s year-end target to 6,600 from 6,100. Kostin in January forecast the index would end the year at 6,500, but cut his estimates as Trump’s tariffs ratcheted up economic uncertainty.
Goldman analysts expect Fed rate cuts to help boost stocks in the second half of the year. The bank’s economists expect officials to make three sequential 25 bps cuts starting in September, followed by two more quarterly cuts next year. Lower rates should increase the S&P 500’s price-to-earnings ratio.
Goldman expects S&P 500 earnings to increase 7% both this year and next, but Kostin notes confidence in that forecast is low due to the ever-changing tariff landscape. “Recent inflation data and corporate surveys indicate less tariff pass-through so far than we expected,” he wrote. He also noted that tariffs are expected to be absorbed gradually and large-cap companies have built up an inventory buffer that could delay their impact.
Stocks have rebounded sharply since President Trump paused the “Liberation Day” tariffs that tanked stocks in early April. Since closing at a year-to-date low on April 8, the S&P 500 has rallied 25%, one of the biggest 3-month rallies of the last 50 years and “the sharpest outside of a recession in 20 years,” according to Kostin.
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Subramanian acknowledges it may be difficult for the index to sustain the breakneck rally. Tech earnings—“the meat of corporate profits”—are expected to decelerate, and the Federal Reserve, in BofA’s view, appears unlikely to cut interest rates soon.
Kostin notes the recent rally, driven by soaring tech stocks like Nvidia (NVDA), Meta (META), and Broadcom (AVGO), has “lowered our market breadth indicator to one of its narrowest readings during the last few decades and its lowest level since 2023.” That could set the index up for either a “catch up” by laggards or a “catch down” by market leaders, he said.
The former is more likely than the latter due to resilient earnings, the likelihood of Fed cuts, and neutral investor positioning, according to Kostin. “As the perceived economic and earnings risk from tariffs continues to fade and the Fed resumes its cutting cycle this fall, investors will likely continue to search for laggards that have not participated in the rally,” he wrote.
What Lies Ahead for Banks the Remainder of the Year
2 hr 15 min ago
Banks, a barometer of the broader U.S. economy, are seeing early signs that the tariff-induced pause in activity is lifting.
It is by no means the jubilant scenario bank CEOs envisioned in November, when President Donald Trump’s victory ushered in optimism about a boom in loans. But it is a welcome shift from April, when Trump’s tariff plans sparked fears that a recession would cause borrowers to default.
Bankers and bank investors hope the fog keeps clearing, paving the way for businesses to pull the trigger on projects they paused this spring.
“We’re not out of the woods here, but it has a better feel than we’ve had in a while,” said Scott Siefers, a bank analyst at Piper Sandler, though any loan rebound would be coming from “a very low base of expectations.”
More borrowers are behind on loan payments, but that number is not “alarming” yet and is similar to pre-pandemic levels, experts say.
Meanwhile, banks have built large capital reserves to protect themselves from losses if the economy falters.
Read the full article here.
Some Analysts Get More Bullish on Lyft and Uber
3 hr 39 min ago
Some Wall Street analysts are more bullish on rideshare giants Uber (UBER) and Lyft (LYFT).
In Lyft’s case, it was the team at Oppenheimer, which late yesterday boosted its price target by $3 to $20, above the average near $17 compiled by Visible Alpha and just $1 off the Street high. As for Uber Technologies, Bank of America on Tuesday boosted its target to $115 from $97, above the roughly $98 mean but a bit off the $120 high.
Oppenheimer sees Tesla’s (TSLA) robotaxi launch as “disappointing,” which it said supports optimism about the rideshare business.
“The bear thesis that robotaxi will subvert rideshare marketplace demand has been firmly halted,” Oppenheimer said. “Additionally, consumer demand and the competitive outlook remains unchanged since [first-quarter] earnings, suggesting a healthy [second quarter/second half] backdrop for rideshare.”
Lyft in May said first-quarter revenue rose 14% year-over-year. Its shares were recently up nearly 2% to above $16, leaving them up close to 27% in 2025.
Bank of America cited a higher multiple for projected free cash flow at Uber, noting optimism about the company’s position in autonomous vehicles as well as growing bookings and “subscriber lock in,” as evidenced by its Uber One offering. The company also said first-quarter revenue grew 14% year-over-year.
Uber’s shares, which ticked about 1% lower in recent trading, are up roughly 60% this year at around $96 apiece.
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Solar Stocks Slump as Trump Cuts Federal Support
4 hr 28 min ago
Enphase Energy (ENPH), First Solar (FSLR), and NextEra Energy (NEE) were among the worst-performing stocks in the S&P 500 after President Donald Trump signed an executive order aimed at ending most federal support for alternative energy.
The order calls on the government to “rapidly eliminate the market distortions and costs imposed on taxpayers by so-called ‘green’ energy subsidies.” It’s designed to use the recently passed budget plan, known as the One Big Beautiful Bill Act, to increase the repeal and modifications to wind, solar, and other alternative energy subsidies.
In addition, Trump ordered the end of “taxpayer support for unaffordable and unreliable ‘green’ energy sources and supply chains built in, and controlled by, foreign adversaries.”
The requirements of executive order are to be implemented by the Secretaries of Treasury and Interior over the next month and a half.
Trump argued that for too long, taxpayers have subsidized “expensive and unreliable energy sources like wind and solar,” which he said have hurt domestic energy sources and the natural landscape, compromised the energy grid, and threatened national security.
NextEra and First Solar were each down nearly 4% in recent trading, while Enphase dropped about 3%.
What Analysts are Saying About Airlines Ahead of Earnings
5 hr 32 min ago
Delta Air Lines (DAL) is scheduled to release its second-quarter results Thursday, setting the tone for other carriers like United Airlines (UAL), Southwest Airlines (LUV), and American Airlines (AAL), each set to report later this month.
Analysts from Bank of America, UBS and Morgan Stanley said in recent notes that they expect Q2 results will be unsurprising after a difficult first half of the year for airline stocks, with third-quarter outlooks more likely to move shares.
“The message from airlines in 2Q25 has been one of stability, a theme we see in many of the demand indicators we follow,” Bank of America analysts wrote. “As such, we expect 2Q25 results to be largely in line with outlooks.”
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Morgan Stanley analysts wrote Monday that the second quarter “arguably shaped up better than feared” following warnings from several airlines about declining demand. However, they added that “there is no question that cracks remain in the macro even if the industry is not falling apart” and “below the relatively calm surface, danger may lurk.”
UBS analysts said they “we see potential for sluggish updates from airlines from their 2Q prints and forward outlooks,” and cut their full-year profit estimates for Delta and United to “reflect a more cautious view on the pace of improvement in demand and RASM performance.”
Delta is expected to report adjusted earnings per share of $2.05 on revenue of $16.38 billion, each lower than a year ago, according to estimates compiled by Visible Alpha. Analysts tracked by the investment research firm are bullish on Delta’s stock, with 10 “buy” ratings and just one “hold,” and an average price target of $58.18, 16% higher than Monday’s closing price.
Tesla Levels to Watch After Monday’s Sell-Off
6 hr 25 min ago
Tesla shares were higher in premarket trading after tumbling Monday following news CEO Elon Musk plans to start a new political party, reigniting concerns that his attention will turn away from running the EV maker and that a public feud with President Trump will escalate.
Tesla shares gained 23% in the second quarter, but are 18% below last month’s high amid escalating tensions between Musk and Trump over the president’s mega tax and spending bill. After Musk announced the formation of the “America Party” on Saturday, Trump posted on his Truth Social platform that Musk had gone “off the rails.”
Tesla shares broke down from a flag earlier this month before shifting gear to retest the pattern’s lower trendline late last week. However, selling accelerated in Monday’s trading session, with the stock falling to its lowest level since early June.
Moreover, the relative strength index registered its lowest reading since early June, confirming weakening price momentum in the EV maker’s stock.
Investors should watch key support levels on Tesla’s chart around $285, $265 and $225, while also monitoring vital overhead areas near $318 and $365.
Tesla shares were up about 1% at around $297 in recent premarket trading, after falling nearly 7% yesterday to lead S&P 500 decliners.
Read the full technical analysis piece here.
S&P 500, Nasdaq Futures Point Higher
7 hr 4 min ago
Futures tied to the Dow Jones Industrial Average were down less than 0.1%.
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S&P 500 futures were up 0.1%.
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Nasdaq 100 futures added 0.3%.
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