Key Takeaways
- The S&P 500 edged 0.1% higher on Monday, Sept. 16, 2024, little changed ahead of the Federal Reserve’s pivotal interest-rate decision this week.
- Intel shares soared after the chipmaker secured a federal grant to produce semiconductors for the U.S. military.
- Shares of Apple and its component suppliers moved lower as analysts pointed to softness in iPhone 16 pre-orders.
Major U.S. stock indexes were mixed on Monday as the Federal Reserve prepares for its meeting this week, with a crucial decision on interest rates due Wednesday. With near certainty that policymakers will begin a rate-cutting cycle, the magnitude of the first rate reduction remains in question.
The S&P 500 ticked 0.1% higher on the day, extending its streak of positive sessions to six and returning to a level just below the all-time high posted in July. The Dow was up 0.6% to a record close. Meanwhile, concerns about sales of the iPhone 16 weighed on shares of Apple (AAPL) and the tech sector, contributing to a drop of 0.5% for the Nasdaq.
Bloomberg reported that Intel (INTC) inked a deal with the federal government to produce semiconductors for the U.S. military, and the chipmaker later confirmed it is eligible to receive up to $3 billion in government funding as part of the 2022 Chips and Science Act. Intel shares surged 6.4%, the top daily performance of any S&P 500 stock.
Bath & Body Works (BBWI) shares jumped 6.2% on Monday. The gains marked a partial recovery for the stock, which has been under pressure since late August, when the retailer of fragrance and personal care products noted the impact of soft consumer spending and lowered its sales forecast. Late last week, Bath & Body Works announced plans to hire more than 30,000 seasonal associates for the holidays, suggesting optimism ahead of the critical season.
Oracle (ORCL) shares jumped 5.1%, notching an all-time high, after a pair of investment research firms highlighted the software giant’s strength in the cloud computing business. Melius Research upgraded Oracle stock to buy, noting Oracle’s partnerships with the “big three” cloud providers could help ensure the sustainability of its pipeline and alleviate margin pressure. Jefferies analysts boosted their price target on Oracle stock to $190, citing backlog growth and strength in Oracle Cloud Infrastructure (OCI) as a signal that the company “is getting its mojo back.”
Analysts from several Wall Street firms said early pre-order data for Apple’s iPhone 16 appeared underwhelming compared with last year’s iPhone 15 launch, noting higher U.S. supply and lower demand are contributing to shorter delivery times for the new version of the smartphone. The news pressured shares of Apple, which fell 2.8% on Monday, as well the tech giant’s suppliers.
Shares of Qorvo (QRVO), which provides radiofrequency chips and antenna components for the iPhone, plunged 6.7%, the steepest decline of any stock in the S&P 500 on Monday. Shares of Skyworks Solutions (SWKS), which supplies radio-related chips for Apple’s smartphones, fell 5.1%.
Elsewhere in the semiconductor industry, analysts at Morgan Stanley reduced their price target on shares of Micron Technology (MU), pointing to oversupply in the memory-chip market. Micron shares slipped 4.4%.