The futures were lower on Thursday after a massive risk-off day across Wall Street in which all the major indexes blasted higher. As expected, Federal Reserve Chair Jay Powell announced an increase of the federal funds rate by 50 basis points, the largest in 20 years. He walked back bigger increases that some had feared and laid the groundwork for similar increases to come in June and July. In addition, the run-off for the Federal Reserve’s massive balance sheet is underway in June, but will only start at $30 billion per month, before ramping up to $60 billion in three months, for Treasury securities. That was less than anticipated.
For agency debt and agency mortgage-backed securities, Powell indicated that the cap initially will be set at $17.5 billion per month and, after three months, will increase to $35 billion per month. Both run-offs are intended to start lowering the staggering $8.5 trillion amount that resides on the books at the Fed.
Responding to the rate increases and the positive Fed-speak, yields were lower across the Treasury curve, with the five-year and 10-year notes and the 30-year long bond all closing higher as buyers stepped in. Brent and West Texas Intermediate crude spiked higher on reports that the European Union is proposing to ban all Russian imports by the end of the year. This despite an unexpected crude inventory build. Natural gas again surged higher, up almost 4%, while gold closed the day flat.
24/7 Wall St. reviews dozens of analyst research reports each day of the week with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.
These are the top analyst upgrades, downgrades and initiations seen on Thursday, May 5, 2022.
Advanced Micro Devices Inc. (NASDAQ: AMD): Goldman Sachs reiterated a Buy rating on the chip giant after the company posted very solid results. The analyst has a $133 target price, but the consensus target is higher at $145.88. The stock closed more than 9% higher on Wednesday at $99.42.
Airbnb Inc. (NASDAQ: ABNB): Baird reiterated an Outperform rating and has a $210 price target. The consensus target is $197.63. The final trade Wednesday was reported at $156.18, a one-day gain of almost 8% after the company posted solid results and had very positive forward guidance.
Biogen Inc. (NASDAQ: BIIB): Baird kept a Speculative Risk rating on the biotech giant and has a $224 target price. The consensus target is up at $243.79, but Wednesday’s closing print was $210.10.
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