Giorno: 1 Marzo 2024

© Reuters.

Investing.com — U.S. stock futures hover below the flatline heading into the final trading day of the week, as investors digested fresh inflation data and eyed the path ahead for Federal Reserve interest rates. OpenAI is reportedly planning to name new board members, as the artificial intelligence group behind ChatGPT faces increased regulatory scrutiny. Elsewhere, China’s manufacturing activity slows for the fifth straight month in February.

1. Futures turn lower as Goldman Sachs removes Apple (NASDAQ:AAPL) from conviction list

U.S. stock futures turned lower on Friday, after Wall Street notched gains in the prior session that were fueled by inflation data which bolstered hopes for a mid-year interest rate cut from the Federal Reserve.

By 06:08 ET (11:08 GMT), the S&P 500 futures contract had slipped by 9 points or 0.2%, Nasdaq 100 futures had inched down by 17 points or 0.1%, and Dow futures had shed 76 points or 0.2%.

Apple was in focus in premarket dealmaking after analysts at Goldman Sachs removed the iPhone manufacturer from its selection of top buy-rated stocks. Shares in Apple were lower ahead of the opening bell.

The main indices all finished in the green on Thursday, with the benchmark S&P 500 and tech-heavy Nasdaq Composite closing at fresh record highs. The blue-chip Dow Jones Industrial Average, meanwhile, edged up by 0.1%.

The personal consumption expenditures (PCE) price index — an inflation gauge closely-monitored by the Fed — eased as expected in January. The reading spurred hopes that inflationary pressures will abate in the coming months, giving the Fed enough impetus to reduce rates in June.

2. OpenAI to name new board members – WaPo

OpenAI is planning to name several new board members in March, The Washington Post reported on Thursday, as regulatory scrutiny on the artificial intelligence darling intensifies.

The Washington Post report comes after other media reports suggested that the U.S. Securities and Exchange Commission was investigating whether the firm misled investors during a major upheaval in its top leadership in November, which included the abrupt firing and reinstatement of CEO Sam Altman.

OpenAI completely revamped its board at the time, removing the group of directors that had attempted to oust Altman. A new board consisting of ex-Twitter Chair Bret Taylor, former Treasury Secretary Larry Summers and Quora CEO Adam D’Angelo was also unveiled.

Microsoft (NASDAQ:MSFT), which is OpenAI’s biggest backer, will also take a non-voting, observing seat on the board, Altman has said.

3. JAB to sell $3 billion in Keurig Dr Pepper shares

Keurig Dr Pepper (NASDAQ:KDP) (KDP) has announced that European investment conglomerate JAB Holdings will sell up to 100 million in shares in the U.S. beverage maker, according to a statement on Thursday.

In a move worth roughly $3 billion at KDP’s most recent closing price, a JAB subsidiary is looking to offload just under 87 million shares through a secondary offering. JAB has also given an option to Morgan Stanley, the follow-up share sale’s underwriter, to buy up to just over 13 million shares. It would be the biggest secondary share sale of a U.S.-listed group since 2022, the Financial Times reported.

JAB Chief Executive Joachim Creus said the proceeds of the sale will allow the firm, which is backed by the billionaire Reimann family, to maintain its “leverage target in line with our financial policies.”

“KDP will continue to be one of our most important investments and we expect to continue to be a long-term anchor shareholder in KDP, at or above the 20% ownership level,” Creus added.

4. Chinese factory activity slows in February

Chinese factory activity shrank as expected in February, taking little support from stronger demand during the Lunar New Year holiday as broader weakness in the world’s second-biggest economy persisted.

The official manufacturing purchasing managers’ index read 49.1 in February, data from the National Bureau of Statistics showed on Friday. The mark was in line with expectations and lower than the 49.2 registered in January.

The reading now been in the sub-50 territory that indicates contraction for five consecutive months.

China’s manufacturing sector is among the biggest drivers of the country’s economy, and is at the heart of a sluggish post-COVID rebound over the past year. Beijing has rolled out a slew of monetary stimulus measures in recent months in an effort to shore up growth. But they have so far provided limited support, with investors now clamoring for more targeted fiscal measures.

5. Oil prices subdued

Oil prices were subdued in European trade on Friday, as broader market optimism that easing inflation could persuade the Fed to begin slashing interest rates by mid-2024 was offset by signs of higher supplies.

Prices were largely rangebound after data showed record-high U.S. production and elevated output from the Organization of the Petroleum Exporting Countries (OPEC), which both signaled that global oil markets may not be as tight as initially expected.

Brent oil futures expiring in May were mostly unchanged at $81.94 a barrel, while West Texas Intermediate crude futures had dipped 0.2% to $78.14 per barrel by 03:34 ET.

Both contracts were on pace to clock weekly gains following a sharp fall in the previous week. While oil prices did notch some gains in February, they have largely remained between $75 to $85 a barrel so far in 2024.

© Reuters.

In recent months, cryptocurrencies have witnessed a tremendous rally, with Bitcoin leading the charge. The rally has seen the most well-known cryptocurrency climb to well over the $60,000 mark (it currently sits at $62,421). Despite this, Marathon Digital (NASDAQ:MARA) stock is not performing so well lately.

As Bitcoin and other crypto prices have soared, investors anticipated that companies heavily involved in the ecosystem would benefit from this upswing, which is usually the way. However, Marathon Digital Holdings, a major player in the Bitcoin mining industry, has bucked the trend somewhat. 

Marathon Digital stock performance

While Bitcoin is up more than 47% this year and 162% in the last 12 months, Marathon Digital has declined 2.8% in the year-to-date. What’s more, MARA stock fell more than 16% on Thursday after missing fourth-quarter earnings and revenue expectations when it posted earnings after the close on Wednesday. 

While the stock has performed very well in the past 12 months (+260%), it currently sits just over $25 per share, way below its 2021 high of over $83. Over the last 52 weeks, shares are up 300%.

Marathon Digital earnings

MARA reported a fourth-quarter loss per share of ($0.02), $0.03 worse than the analyst estimate of $0.01, while revenue for the quarter came in at $156.7 million, above the consensus estimate of $141.55 million.

Following the report, renowned short seller Jim Chanos said on X that he is still trying to understand the Marathon Digital business model. 

“4Q EBITDA was $170M annualized, on $1B of capital invested in the business, ex-cash/crypto holdings($4 per share). Their 4Q breakeven cost was $42K per #Bitcoin. Like $MSTR, this is simply a leveraged bet on a commodity,” said the account.

Meanwhile, Compass Point analyst Joe Flynn said MARA’s 4Q23 results were “strong from an uptime and BTC production standpoint, having mined ~4.2K BTC during the quarter, but weak from a cost ($0.065/kWh vs. our estimate of ~$.057/kWh and higher G&A) and margin perspective (52% GM vs our estimate 57%), resulting in pro forma Adj. EBITDA of $61M.”

Why Marathon stock is falling

Flynn went on to explain that “MARA benefits significantly from its estimated ~17K BTC on its balance sheet, causing the stock to be highly correlated to the price of BTC compared to other miners.”

However, he notes that with BTC now over $60,000, the stock has seen significant strength but was overextended and sold off after hours due to the miss.

The share price decline comes despite Flynn acknowledging that the MARA stock price has shrugged off the company’s operational challenges through the first quarter of 2024 and MARA acquiring and taking over management of Hut8/US BTC’s data centers. 

The operational challenges related to downtime of its hosted miners at Applied Digital and maintenance as ownership and management of previously owned Hut8 transitions to MARA through the 1Q24. However, Flynn believes the headwinds look to be largely behind the company.  

Flynn adds that “the company trades at a significant premium to the rest of the space,” allowing it to continue using its liquidity and stock as currency “to pursue aggressive growth projects such as expansion to ~50 EH/s by 2025, site acquisitions, and technology projects like Slipstream and recently announced layer-2 BTC solutions.” 

Despite the share price decline, “MARA remains the 800-pound gorilla in the mining space,” according to Compass Point, and remains well positioned through the halving despite its weaker fundamentals relative to other miners.

© Reuters. Goldman removes Apple stock from ‘US Conviction List – Directors’ Cut’

Goldman Sachs’ “Conviction List – Directors’ Cut,” the bank’s selection of top buy-rated stocks, no longer includes Apple (NASDAQ:AAPL), the investment giant said in a Friday note. Apple stock fell 0.8% on the news.

Despite the move, analysts at Goldman maintain that the market’s emphasis on the deceleration of product revenue growth overlooks the resilience of the Apple ecosystem, along with the stability and predictability of its associated revenues.

“Analysts see Apple’s installed base growth, secular growth in services, and new product innovation as more than offsetting cyclical headwinds to product revenue, such as a reduced iPhone unit demand from a lengthening replacement cycle and reduced consumer demand for the PC & tablet category,” the note states.

Goldman stressed that multiple factors could lead to a stock being removed from their Conviction List such as analysts revising their opinions due to a lack of confidence in their initial assessment or achieving the anticipated price target, among other things.

Meanwhile, Southern Co (SO) was also taken off the list, while new additions include Amgen (AMGN), Monday.com (MNDY), and Vulcan Materials (VMC).

© Reuters.

Investing.com — Apple’s reported decision earlier this week to scrap its plans to create an electric car could help boost the tech giant’s push to develop its artificial intelligence capabilities, an analyst at Edward Jones has told Investing.com.

An Apple Electric Car

Citing people familiar with the matter, Bloomberg first reported that California-based Apple (NASDAQ:AAPL) is canceling its decade-long, multi-billion dollar effort to carve out a place in the market for battery-powered vehicles.

Code-named Project Titan, the initiative was launched around 2014, with Apple eventually hoping to produce a fully autonomous car that would be guided by voice commands. However, leadership changes and strategic overhauls weighed on the project’s progress.

More recently, high prices for electric vehicles and a relative lack of general charging infrastructure have led to a slowdown in consumer demand. The trend, as well as supply chain constraints, have persuaded car groups Ford (NYSE:F) and General Motors (NYSE:GM) to shift their focus away from electric vehicles and towards hybrid options. Meanwhile, Elon Musk’s Tesla (NASDAQ:TSLA) — considered one of the foremost EV players — has warned that sales growth would be “notably lower” this year.

What Analysts are Saying

Apple announced the end of its EV ambitions in an internal disclosure on Tuesday, various media sources reported. Chief Operating Officer Jeff Williams and Kevin Lynch, an executive involved with the project, shared the decision to the nearly 2,000 staffers working on the effort, Bloomberg reported.

Reports also said that employees on the car team would be shifted to Apple’s artificial intelligence unit, where they would focus on developing generative AI — a nascent technology that has become a crucial strategic pillar for Apple and the wider tech industry.

Apple has so far declined to comment on these reports. The company and its Chief Executive Tim Cook have largely stayed quiet on the car project, referring to it only as work on “autonomous systems.”

In the short term, Apple is now likely able to ratchet down research and development expenditures that were being poured into its EV plans, Logan Purk, a Senior Research Analyst at Edward Jones, told Investing.com. Apple has never disclosed its outlays on the effort, although overall research and development spending in 2023 touched around $30 billion, up 14% versus the previous year.

“Longer term this move frees up internal resources to focus on other areas such as white-hot AI applications, which is an area Apple has thus far lagged behind peers,” he added.

Apple has been slower to fold AI into its offerings, worrying investors who are also eyeing waning demand for the company’s flagship iPhone device and fierce competition at its key Chinese operations.

Cook told shareholders on Wednesday that the firm would unveil its plans to put generative AI to use later this year, describing current investments in the area as “significant.”

But Purk flagged that Apple’s decision to ditch its EV plans removes what was a “new massive market” for the business.

“Companies of Apple’s size are always looking for new markets to penetrate in order to move the growth needle, which is why autos and health care have drawn interest from several large tech companies over time,” he said. “This announcement by Apple shows how difficult it is to break into the market with a differentiated product.”

Impact on Apple stock

Investors seemed to welcome the news that Apple was canceling its car plans. Shares in the group rose on Tuesday following Bloomberg’s initial report, although Purk argued that for most shareholders the move was a “non-event” because they had not factored the launch of an Apple vehicle into their expectations.

Analysts at Morgan Stanley also said that it “should not come as a shock.” But they noted that Apple’s car strategy remains “in play,” pointing in particular to the capability of its CarPlay software, which allows drivers to access iPhone features.

Even still, Apple’s decision is “negative” for the wider electric vehicle and autonomous vehicle market, the Morgan Stanley analysts said. They added that the company’s talents and capital would likely have accelerated scientific developments in the auto industry, while also contributing to an improvement in supply chains and an expansion in infrastructure.

“A company with Apple’s pedigree ‘turning away’ from auto in order to focus on [generative AI] and [large language models] is seen by some investors as a ‘sad day’ for Auto 2.0,” the Morgan Stanley analysts said in a note to clients on Wednesday.

Learn more about Apple

Since its inception in 1976, Apple has often been at the forefront of advanced personal tech, embodied first by its co-founder Steve Jobs and then by current CEO, Tim Cook.

Investors can learn more about this tech titan’s journey with our article on Apple facts, statistics and sales figures.

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© Reuters. FILE PHOTO: Sam Altman, CEO of OpenAI, attends the 54th annual meeting of the World Economic Forum, in Davos, Switzerland, January 18, 2024. REUTERS/Denis Balibouse/File Photo
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By Jahnavi Nidumolu, Aditya Soni and Sheila Dang

(Reuters) -Billionaire entrepreneur Elon Musk has sued ChatGPT-maker OpenAI and its CEO, Sam Altman, saying they abandoned the startup’s original mission to develop artificial intelligence for the benefit of humanity and not for profit.

The lawsuit filed late on Thursday in California Superior Court in San Francisco is a culmination to Musk’s long-simmering opposition to the startup he co-founded and which has since become the face of generative AI, partly due to billions of dollars in funding from Microsoft (NASDAQ:MSFT). Musk has gone on to found his own artificial intelligence startup, xAI, which he launched last July.

Musk in the lawsuit alleged a breach of contract, saying Altman and co-founder Greg Brockman originally approached him to make an open source, non-profit company, but the startup established in 2015 is now focused on making money.

Recounting OpenAI’s founding, Musk said the three men had agreed to work on artificial general intelligence (AGI), a concept that machines could handle tasks like a human, but in a way that would “benefit humanity,” according to the lawsuit.

OpenAI would also work in opposition to Alphabet (NASDAQ:GOOGL) Inc’s Google, which Musk said he believed was developing AGI for profit and would pose grave risks.

Instead, OpenAI “set the founding agreement aflame” in 2023 when it released its most powerful language model GPT-4 as essentially a Microsoft product, the lawsuit alleged.

Musk has sought a court ruling that would compel OpenAI to make its research and technology available to the public and prevent the startup from using its assets, including GPT-4, for the financial gains of Microsoft or any individual.

OpenAI, Microsoft and Musk did not respond to Reuters requests for comment.

Musk is also seeking a ruling that GPT-4 and a new and more advanced technology called Q* would be considered AGI and therefore outside of Microsoft’s license to OpenAI.

Reuters in November was first to report on Q* and warnings from OpenAI researchers about a powerful AI discovery.

Musk, who runs electric vehicle maker Tesla (NASDAQ:TSLA) and rocket maker SpaceX and bought Twitter for $44 billion in October 2022, later renaming it X, stepped down from OpenAI’s board in 2018 and has on several occasions called for regulation on AI.

“We expect this will have 0 impact on AI development inside or outside of OpenAI, and would chalk it up to Musk seeking to get a slice of equity in a company he effectively founded but in which he holds no stake,” said Giuseppe Sette, president and co-founder of market research firm Toggle AI.

OpenAI’s tie-up with Microsoft is under antitrust scrutiny in the United States and Britain following the startup’s boardroom battle last year that resulted in the sudden ouster and return of Altman and the creation of a new temporary board.

The startup is planning to appoint new board members in March, the Washington Post reported on Thursday. Microsoft said in November it would have a non-voting, observer seat on the board.

Some legal experts said Musk’s allegations of breach of contract, which is partly based on an email between Musk and Altman, could fail to hold up in court.

While contracts can be formed through a series of emails, the lawsuit cites an email that appears to look like a proposal and a “one-sided discussion,” said Brian Quinn, a law professor at Boston College Law School.

“To the extent Musk is claiming that the single e-mail in Exhibit 2 is the ‘contract,’ he will fall well short,” Quinn said.

MUSK’s xAI

Musk’s rival AI effort with xAI is made up of engineers hired from some of the top U.S. technology firms such as Google and Microsoft that he hopes to challenge.

The startup started rolling out its ChatGPT competitor Grok for Premium+ subscribers of social media platform X in December and aims to create what Musk has said would be a “maximum truth-seeking AI.”

According to xAI’s website, the startup is a separate company from Musk’s other businesses, but will work closely with X and Tesla.

Musk has also made waves about his interest in artificial intelligence via Tesla. In January, he stirred controversy with Tesla shareholders, saying he felt uncomfortable growing the carmaker into a leader in AI and robotics unless he had at least 25% voting control of the company. Musk, who ranked second on the Forbes Real-Time Billionaires List on Friday, at an estimated worth of $210.6 billion, currently owns about 13% of Tesla.

Musk, who has called AI a “double-edged sword,” was among a group of AI experts and industry executives who last year called for a six-month pause in developing systems more powerful than OpenAI’s GPT-4, citing great risks to humanity and society.

Since its debut, ChatGPT has been adopted by companies for a wide range of tasks from summarizing documents to writing computer code, setting off a race among Big Tech companies to launch their own offerings based on generative AI.

© Reuters. FILE PHOTO: A passerby is reflected on an electronic screen displaying a graph showing recent Japan’s Nikkei share average movements and stock prices as the share average hits a record high in Tokyo, Japan February 26, 2024. REUTERS/Issei Kato/File Photo

By Sinéad Carew and Caroline Valetkevitch

NEW YORK (Reuters) -A global equity index scaled a record high while Treasury yields fell sharply on Friday after weak U.S. economic data and comments from Federal Reserve officials bolstered expectations for interest rate cuts later this year.

The Institute for Supply Management (ISM) said its manufacturing PMI fell to 47.8 last month from 49.1 in January, the 16th straight month that the PMI remained below 50. This indicates contraction in manufacturing.

The University of Michigan surveys of consumers showed all three measures for sentiment, current conditions and consumer expectations falling more than expected.

Also on Friday, Fed Governor Chris Waller kindled hopes for lower interest rates, saying decisions about the ultimate size of the Fed balance sheet have no bearing in its inflation fight rate policy.

On Thursday, the U.S. personal consumption expenditures (PCE) report was in line with expectations and showed annual inflation growth the smallest in three years.

“When you take all of it together, you’re seeing the balance tilting a little bit more toward the likelihood of there being more rate cuts, which has supported equities,” said Sinead Colton Grant, chief investment officer at BNY Mellon (NYSE:BK) Wealth Management.

She also said equities drew support from a stronger-than-expected earnings season and enthusiasm about artificial intelligence.

Investors appeared to shrug off a note of caution from Richmond Federal Reserve President Thomas Barkin, who said U.S. price pressures still exist and it is too soon to predict when the Fed will cut rates.

On Wall Street, the S&P 500 closed at a record high for the second day in a row, with a strong boost from the technology sector and falling Treasury yields adding to bullishness.

The Dow Jones Industrial Average rose 90.99 points, or 0.23%, to 39,087.38, the S&P 500 gained 40.81 points, or 0.80%, to 5,137.08 and the Nasdaq Composite gained 183.02 points, or 1.14%, to 16,274.94.

MSCI’s gauge of stocks across the globe rose 5.81 points, or 0.76%, to 767.09 and hit a record high.

The STOXX 600 index closed up 0.6% after Eurostat figures published showed inflation across the 20-nation euro zone eased to 2.6% in February from 2.8% a month earlier.

Global factory surveys showed manufacturing output had continued to fall in both Europe and Asia.

And in Asia, Japan’s Nikkei index jumped 1.9% to hit a fresh all-time high, extending a surge of 7.9% the previous month when it breached levels last seen in 1989.

In U.S. Treasuries, yields fell sharply including two-year yields’ biggest daily decline since the end of January after the manufacturing data and Waller’s suggestion of the need for more shorter-dated Treasuries.

The 2-year note yield, which typically moves in step with interest rate expectations, fell 11.1 basis points to 4.5354%, from 4.646% late on Thursday.

The yield on benchmark U.S. 10-year notes fell 6.6 basis points to 4.186%, from 4.252% while the 30-year bond yield fell 4.7 basis points to 4.3285% from 4.375% late on Thursday.

In currencies, the dollar fell against the euro on weaker-than-expected U.S. economic data but gained against the Japanese yen after Bank of Japan governor Kazuo Ueda said it was too soon to declare victory on inflation.

The dollar index, which measures the greenback against a basket of major currencies, fell 0.2% at 103.91, with the euro up 0.28% at $1.0833.

Against the Japanese yen, the dollar strengthened 0.09% to 150.12 yen.

In cryptocurrencies, bitcoin rose 2.36% to $62,898.00 after hitting a more than two-year high of $63,933 on Wednesday.

In commodities, oil prices settled higher and posted weekly gains as traders awaited an OPEC+ decision on supply agreements for the second quarter while they weighed U.S., European and Chinese economic data.

U.S. crude settled up 2.2% at $79.97 a barrel and Brent finished at $83.55 per barrel, up 2% on the day.

In metals, gold started the month on a positive note, with prices rising to a two-month high the muted economic data.

Spot gold added 1.97% to $2,083.41 an ounce.

© REUTERS

The AMD (NASDAQ:AMD) stock price has had a tremendous rise over the last few months, rising 110% since October and more than 39% in the year-to-date. Like most semiconductor chip companies, the rally has been fueled by artificial intelligence (AI). 

For many analysts and investors, such a rise may result in some cautiousness. However, Citi is still “wildly bullish on the stock.”

AMD stock rally

As mentioned, the rise of artificial intelligence has fuelled the rally for AMD, with growth primarily stemming from the data center market, where the company has gained share in recent years.

Goldman Sachs analysts said in a recent note that, looking ahead, they “expect large cloud hyperscale customers to prioritize capital spending on accelerated compute (vs. general-purpose compute) in 2024, and for market share within general-purpose compute (or traditional servers) to shift in favor of AMD.”

Of course, the rise across the sector has been led by Nvidia (NASDAQ:NVDA). However, AI chip demand across the board has boosted share prices. 

In its recent first quarter 2024 earnings release, AMD reported mixed results and lowered 1Q24 guidance, but it raised its expectation for MI300 sales in 2024 from over $2 billion to over $3.5 billion. 

However, analysts at Citi estimate over $5 billion in 2024 MI300 sales and $8 billion in 2025 in MI300 sales.

The January 30 earnings release saw AMD shares decline just over 2.5% to $167.69 per share. However, since then, it has pushed to well over $197 per share. AMD stock hit a high of $201.59 today. 

Citi remains bullish on AMD stock

Despite the already monumental rise for stock prices in the sector, Citi analysts said in a recent note that they are “wildly bullish” on semiconductor stocks, given stable demand in PC’s/Handsets/Servers (53% of semi-TAM) and inventory replenishment given semi units were down 19% in 2023, the worst decline in over 20 years.”

The bank is looking for at least 11% year-on-year growth in global semiconductor sales in 2024 and recently raised its C24 semi sales forecast from 10% to 11% year-on-year growth and expects it to rise again this year. 

“AI leads the way – stay long NVDA, AMD, AVGO,” declared the firm. “The AI market continues to grow, and our checks indicate TAM expansion with government agencies, universities, and large/medium businesses all buying AI chips.”

They continue to favor NVDA, AMD, and AVGO and expect the upcoming AVGO earnings to be another positive catalyst for the sector. 

The firm also notes that Intel (NASDAQ:INTC) and AMD’s combined fourth quarter 2023 PC business was slightly above seasonality, and they expect a seasonal first quarter of 2024. 

“While the data center end market is still going through an inventory correction and some TAM loss to AI, we believe it should end sometime in 1H24,” wrote Citi. 

Overall, Citi remains Buy-rated on AMD and raised its target price for the stock from $136 to $192 per share in the note. 

© Reuters. Boeing holds preliminary discussions about acquiring supplier Spirit AeroSystems – WSJ

(Updated – March 1, 2024 4:03 PM EST)

Boeing (NYSE:BA) is currently in discussions to acquire Spirit AeroSystems (NYSE:SPR), according to a report by The Wall Street Journal on Friday.

The publication states, citing people familiar with the matter, that the planemaker has had preliminary discussions with the troubled jet fuselage supplier it split off two decades ago. Spirit is said to have hired bankers to explore strategic options.

The WSJ cautioned that the talks may not result in a deal.

Still, Spirit shares rose more than 15% on Friday while Boeing dropped nearly 2%.

Both companies have been at the center of quality issues affecting 737 MAX jets. Boeing’s manufacturing issues have been causing problems for Spirit, which has led to scrutiny of its production processes. A fuselage made by Spirit factory was involved Alaska Airlines door-plug blowout in January.

SPR is also reportedly exploring the sale of its Ireland-based operations that manufacture parts for Airbus, a rival of Boeing.

Furthermore, the WSJ says that privately, analysts have stated that fixing up Spirit as a separate entity has proven difficult.

© Reuters.

Investing.com– The S&P 500 and Nasdaq wrapped up a strong week with record closes on Friday, underpinned by slump in Treasury yields and an Nvidia-led surge in chip stocks as the latest quarterly results from tech continue to point to accelerating artificial intelligence demand.

By 16:00 ET (21:00 GMT), the Dow Jones Industrial Average was up 98 points, or 0.3%, S&P 500 gained 0.8% to close at 5,136.23, while NASDAQ Composite jumped 1.1% to a record 16,274.94.

Fed’s Waller remarks, weaker data sink Treasury yields

Fed governor Christopher Waller said Friday he would like to see the U.S. central bank shift its holdings more toward short-term Treasuries, sending the yield on the 2-year Treasury 11 basis points lower to 4.54%.

Data on Friday showing consumer sentiment unexpectedly slipped in February, and manufacturing activity deteriorating further into contraction territory boosted hopes for an earlier rate cut in further blow to Treasury yields to boost growth sectors including tech.

Markets are pricing in a rate cut in June, according to Investing.com’s Fed Rate Monitor Tool.  

Nvidia (NASDAQ:NVDA) closes above $2T for first time as Dell, Netapp, Hewlett Packard results underscore AI demand 

Nvidia-led a surge in chip stocks to close above $2 trillion for the first time ever as bullish quarterly results from enterprise hardware makers including Dell showed demand for AI-enabled hardware including chips continued to accelerate.

Dell Technologies (NYSE:DELL) surged 31% on stronger-than-expected earnings and guidance as solid demand for its artificial intelligence-optimized servers offset weakness in personal computing.. Dell’s AI backlog at the end of the quarter for GPU servers was $2.9B, up about 80% from $1.6B last quarter.

Hewlett Packard Enterprise Co (NYSE:HPE), meanwhile, reported softer guidance, pressured by ongoing weakness in the PC market, and reported AI server shipments of $400M and $3B of backlog. The stock rose 2%, shrugging off negative remarks on Wall Street. “The stock remains relatively inexpensive, but given the flat outlook and ongoing macro concerns we view the risk/reward in HPE as balanced,” UBS said in a note.

NetApp (NASDAQ:NTAP) soared 18% on a strong outlook for 2024 amid an improving demand backdrop following a period of stagnant demand. The company’s “new solutions appear to target block specifically and could allow NTAP to significantly grow its TAM if they succeed in penetrating the market,” Wedbush said in a note.

Fisker tumbles after flagging financial trouble; New York Community Bancorp warns of material weaknesses in internal controls

Electric vehicle maker Fisker (NYSE:FSR) plummeted more than 34% after it warned of a substantial doubt over its ability to stay afloat amid waning EV demand and production setbacks. The company said, however, that it was in talks with an large automaker to potentially secure funds and detailed plans to cut its workforce by 15% as it looks to strengthen its finances. 

New York Community Bancorp (NYSE:NYCB) tumbled nearly 26% after the embattled regional lender said it had found “material weaknesses” in company controls related to an internal loan review, stoking further worries about its exposure to commercial real estate loans.  

Vista Outdoor (NYSE:VSTO) rose 6% after the Wall Street Journal reported that the sporting and outdoor products group has received a $2.9 billion takeover offer, including debt from investment firm MNC Capital.

Boeing reportedly eyes Sprit Aerosystems takeover amid pressure to step-up quality control

Boeing Co (NYSE:BA) is currently in talks to acquire its supplier Spirit Aerosystems Holdings Inc (NYSE:SPR), The Wall Street Journal on Friday, citing unnamed sources, sending shares of the latter up 14%.

The move comes as Boeing pressure is mounting on the aircraft maker to restore its credibility after a recent string of issues affecting 737 MAX jets including the Alaska Airlines door blowout in January that was linked to faulty door plug supplied by Spirit AeroSystems.

Earlier this week, the U.S. Federal Aviation Administration ordered Boeing to develop a comprehensive plan to address quality-control issues within 90 days.

(Peter Nurse, Ambar Warrick contributed to this article.)