The futures traded lower after a mild risk-off day across Wall Street that saw the major indexes close mixed. The Dow Jones industrials alone scratched out a small gain. Most strategists continue to cite the overbought conditions and the huge amount of short covering over the past eight weeks by hedge funds and other institutional accounts. While many continue to see a soft landing for the economy, some of the incoming data is turning negative, with U.S. banks reporting tighter credit standards and weakening loan demand.
Treasury yields were up across the curve as the sellers returned on Tuesday, especially on the long end. The 10-year note and the 30-year long bond both surged over the 4% level again to close at 4.04% and 4.09%, respectively. With a host of economic data this week, not the least of which was the job openings data, which came in below expectations, bond traders also have an eye to Friday’s nonfarm payrolls for July. With the yield inversion still in place, albeit narrower, recession is likely still in our future.
Brent and West Texas Intermediate crude took a breather after a strong move higher capped off a July in which oil jumped almost 14%. That was the best month for the black gold since January of 2022. Profit-taking and some concerns about China were cited as both of the benchmarks closed down, despite OPEC production falling to the lowest level in three years. Brent finished at $85.07, while WTI ended the session at $81.50. Natural gas closed at $2.58.
Gold was also hit Tuesday, after a solid late-July run. The bullion finished the day down almost 1.5% at $1,979.40. Gold headed lower after the latest data on the U.S. manufacturing sector showed it contracted for the ninth consecutive month. Reasonably stunning data for those that say no recession is possible. Bitcoin was hit hard as well early in the session, but bargain-bin traders jumped in pushing a modest gain as the cryptocurrency closed at $29,249.20.
24/7 Wall St. reviews dozens of analyst research reports each weekday 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 Wall Street analyst upgrades, downgrades and initiations seen on Wednesday, August 2, 2023.
American Eagle Outfitters Inc. (NYSE: AEO): Barclays upgraded the stock to Overweight from Equal Weight and lifted its $11 target price to $18. The consensus target is $12.91. The final trade on Tuesday was for $14.61 a share.
Apple Inc. (NASDAQ: AAPL): Baird reiterated an Outperform rating and raised its $180 target price to $204. The consensus target is $194.19. The stock closed on Tuesday at $193.22. The consumer electronics giant will post earnings on Thursday.
Coinbase Global Inc. (NASDAQ: COIN): Canaccord Genuity reiterated a Buy rating and doubled the target price, to $140 from $70. That new target is well about the consensus figure. The stock closed almost 5% lower on Tuesday at $593.87.
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