Volatility Spooks Investors As Treasury Yields, Dollar Climb Ahead Of Key Economic Releases: What's Driving Markets Wednesday?
Portfolio Pulse from Piero Cingari
Volatility surged in the market as Treasury yields and the US dollar climbed ahead of key economic releases. The CBOE Volatility Index (VIX) spiked 9%, and the yield on the 30-year Treasury note rose to 4.74%. The iShares 20+ Year Treasury Bond ETF (TLT) fell 1.3%, while the Invesco DB USD Index Bullish Fund ETF (UUP) rose 0.5%. Major US equity indices and sectors traded in the red. American Airlines (AAL) tumbled 14% after trimming Q2 earnings guidance and receiving analyst downgrades. ConocoPhillips (COP) announced an all-stock deal to buy Marathon Oil (MRO), with COP shares falling 4% and MRO rising 8%. Bank OZK (OZK) dropped 14% following a downgrade from Citigroup. Dicks Sporting Goods (DKS) spiked 15% after beating earnings expectations. Other notable stock movements included Heico Corp. (HEI) up 2.1%, Viking Holdings (VIK) down 2.7%, Chewy Inc. (CHWY) up 29%, Abercrombie & Fitch (ANF) up 22%, and Advance Auto Parts (AAP) down 8%.
May 29, 2024 | 5:32 pm
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POSITIVE IMPACT
Abercrombie & Fitch (ANF) rose 22% following positive earnings results.
Positive earnings results generally lead to a significant rise in stock price.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Chewy Inc. (CHWY) surged 29% after reporting strong earnings.
Strong earnings results typically lead to a significant rise in stock price.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Dicks Sporting Goods (DKS) spiked 15% after beating earnings and revenue expectations.
Positive earnings surprises typically lead to a significant rise in stock price.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Heico Corp. (HEI) rose 2.1% following positive earnings results.
Positive earnings results generally lead to a rise in stock price.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
POSITIVE IMPACT
Marathon Oil (MRO) rose 8% following the announcement of an all-stock deal with ConocoPhillips.
The acquisition premium typically leads to a rise in the target company's stock price.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 85
POSITIVE IMPACT
The Invesco DB USD Index Bullish Fund ETF (UUP) rose 0.5% as the US dollar strengthened.
A stronger US dollar typically benefits ETFs like UUP that track the performance of the dollar.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
American Airlines (AAL) tumbled 14% after trimming Q2 earnings guidance and receiving analyst downgrades.
Negative earnings guidance and analyst downgrades typically lead to a significant drop in stock price.
CONFIDENCE 95
IMPORTANCE 80
RELEVANCE 90
NEGATIVE IMPACT
Advance Auto Parts (AAP) fell 8% following earnings results.
Negative or disappointing earnings results typically lead to a drop in stock price.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
ConocoPhillips (COP) announced an all-stock deal to buy Marathon Oil (MRO), with COP shares falling 4%.
Acquisitions often lead to a short-term drop in the acquirer's stock price due to the costs and risks associated with the deal.
CONFIDENCE 90
IMPORTANCE 75
RELEVANCE 85
NEGATIVE IMPACT
Bank OZK (OZK) dropped 14% following a downgrade from Citigroup.
Analyst downgrades, especially from major firms like Citigroup, typically lead to a significant drop in stock price.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
The iShares 20+ Year Treasury Bond ETF (TLT) fell 1.3% as Treasury yields climbed.
Rising Treasury yields typically lead to falling bond prices, negatively impacting bond ETFs like TLT.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Viking Holdings (VIK) fell 2.7% following earnings results.
Negative or disappointing earnings results typically lead to a drop in stock price.
CONFIDENCE 85
IMPORTANCE 60
RELEVANCE 70