Equit🎶y Indexes Wrap: Dow Notches🃏 All-Time High; Regional Banks, Real Estate Soar on Falling Treasury Yields and Fed Interest Rate Forecasts

The Dow

Shares of Walgreens Boots Alliance (WBA) jumped 7.4𝓰% amid reports that the company is exploring separating the Boots U.K. pharmacy chain, either through a sale or public listing in London. The stock has gained 23% so faꦜr this month after dropping to a 25-year low in late November.

Goldman Sachs (GS) gained 2.9%, boosted by buoyant equities markets. G♊oldman, which derives a substantial amount of revenue from corporate dealmaking and trading, has been hit especially hard in the last two years by negative sentiment and market volatility.

Apple (AAPL) shares gained 1.6% despite reports the European Union is expe🎃cted to force the iPhone maker to change the way its App Store deals with music-streaming competitors. It could also be hit with a fine of as much as 10% of annual sales. 

Only two Dow stocks closed in the red Wednesday: Verizon (VZ), down 0.8%, and IBM (IBM), down 0.7%. 

The S&P 500

Regional bank stocks soared after the Federal Reserve sparked a bond market rally with its interest rate decision. The plummeting value of banks’ bond holdings was at the center of this year’s regional banking crisis. Zions Bancorp (ZION) rose 9.7%, while Keycorp (KEY), Citizens Financial (CFG), and Comerica (CMA) all gained more than 7%. 

Solar stocks, beaten down by high interest rates this year, popped on expectations of several rate cuts next year. Enphase Energy (ENPH) gained 8.5% and SolarEdge (SEDG) jumped 8.4%. 

The real estate sector also got a major boost from today’s rate decision. The sector rose 3.6%, led by premium office owner Boston Properties (BXP)—up 8.5%—and office building and laboratory owner Alexandria Real Estate (ARE)—up 7.4%.

Shares of Take-Two Interactive (TTWO) gained 3.8% after Nasdaq said the video game maker would replace Seagen (SGEN), which is being acquired by Pfizer, in the Nasdaq-100 effective༒ De♔c. 18. 

Pfizer (PFE) tumbled 6.7% after 澳洲幸运5开奖号码历史查询:its 2024 guidance fell short of analysts’ expectations. 

Southwest Airlines (LUV) lost 3.8% after it 澳洲幸运5开奖号码历史查♉询:raised its current-quarter fuel cost estimates and lowered its 2024 capacity outlook. 

Etsy (ETSY) fell 2.2% after it announced plans to lay off 11% of its workforce, or about 225 employees. 

The Nasdaq-100

Vertex Pharmaceuticals (VRTX) shares 澳洲幸运5开奖号码历史查询:jumped 13.2% after iꦅt reported positive results fromဣ a mid-stage trial of an experimental non-opioid painkiller.

Broadcom (AVGO) rose 1.6% to close at a record-high for 澳洲幸运5开奖号码历史查询:the third consecutive day after Ba🐎nk of America joined C🗹itigroup in raising its price target on the stock. 

Tesla (TSLA) rose 1%, shaking off earlier losses following the announcement of a 澳洲幸运5开奖号码历史查询:2 million car recall to address safety concern♒s with i🐓ts autopilot software. 

Adobe (ADBE) shares fell 1.5% ahead of its quarterly earnings report after the bell. The design software maker was one of only eight stocks in the index to lose value Wednesday. The laggards included international e-commerce giants PDD Holdings (PDD), down 0.5%, and MercadoLibre (MELI), down 0.2%. T-Mobile (TMUS) slipped 0.6%.

Dow Tops 37,000 Milestone, On Track to Close at⛦ Record High

The Dow Jones Industrial Average surge꧙d more than 1% Wednesday afternoon to🦩 trade above 37,000 for the first time as markets cheered signs the Fed is turning more dovish.

Federal Reserve officials are expecting 75 basis points in rate cuts next year. That's less than the 125 basis points that markets are expecting but better than September's projections, in which the median forecast among central bank officials was for one 25 basis point cut.

Fed Holds Rates Ste💖ady; Officials See 🔯Three Cuts Next Year

The 澳洲幸运5开奖号码历史查询:Federal Open Market Commit♎tee (FOMC) o💃n Wednesday decided, in a widely expected move, to leave interest rates at a 22-year high. It is the third meeting this year at which the Fed has forgone a rate change after hiking interest rates in 11 consecutive meetings starting in March 2022.

Wednesday's announcement also brought new economic projections, which showed central bank officials expect, on average, to cut interest rates three times next year. That would bring the target federal funds rate down to a range of 4.5% to 4.75%, lowering interest rates across the economy and easing pressure on consumers and businesses feeling the pain of higher borrowing costs.

Stocks jumped on the announcement, with the S&P 500, Nasdaq, and Dow all trading about 0.6% higher 💙immediately following the news.

Treasurys also rallied, sending yields plummeting. The benchmark 10-year yield sank to a 5-month low below 4.1%, and the 2-year note plummeted 22 basis pointsꦯ.

Midday Movers

Vertex Pharmaceutical (VRTX) shares jumped aไfter it reported positive results from a phase 2 trial of its experimental non-opioid painkiller VX-548 in patients with painful ไdiabetic peripheral neuropathy.

Broadcom (AVGO) shares t🌞raded at yet another all-time high after Bank of America joined Citi in raising its price target for the stock. BofA boosted its price target to $1,250 from $1,200, citing "strong VMWare synergies and growth potential."

Pfizer (PFE) was the worst-performing stock in the S&P 500 after the drug maker 澳洲幸运5开奖号码历史查询:posted 2024 guidance that was short of expectations as demand declines for its COVID-19 p🎃roducts.

Southwest Airlines (LUV) shares headed lower as the carrier increased its fuel cost estimate and moderated its plans to 🅘boost capacity.

Tesla Shares Fall on 2 Million Car Recall

Tesla Inc. (TSLA) will 澳洲幸运5开奖号码历史查询:recall more than 2 million vehicles in the U.S. to🧜 install new safeguards for its Autopilot feature in response to regulatory concerns about the♎ system.

The move follows a two-year investigation by the National Highway Traffic Safety Administration (NHTSA) after a series of crashes involving Tesla's Autopilot or Traffic Aware Cruise Control features. The recall will incorporate additi๊onal controls and alerts🧜 to keep drivers focused, the regulator said.

Tesla said it disagreed with the findings 🅠but that it would offer a free over-the-air software update for all affected vehicles on or after Dec. 12, 2023.

Shares in the world's most valuable automaker were down about 3% at $230 in midday trading on Wednesday.

-Kevin George

Pfizer Falls to 10-Year Low on C🌜onservativ🌞e 2024 Guidance

Pfizer (PFE) shares 澳洲幸运5开奖号码历史查询:tumbled nearly 8% Wednesday morning to their lowest level in more than 10 years after warning revenue could decline next year and releasing guidance below forecasts as demand for its COVID-19 vaccin🃏es and treatment🎃s wanes.

The drug maker indicated it expects 2024 revenue to be in the range of $58.5 billion to $61.5 billion, up slightly from this year’s outlook of $58 billion to $61 billion. It projects profit of $2.05 to $2.25 per share. Both were short of estimates.

Pfizer indicated that its COVID-19 shot and Paxlovid treatment for the virus will generate $8 billion in sales next year, versus the approximately $12.5 billion it expec🉐ts to make on those products this year.

With Wednesday's decline, Pfizer shares have lost close to half their value this year.

-Bill McColl

BofA Sees Fed’s Preferred Inflation Gauge ♐Falling to Key Level Ne꧂xt Week

After two reports this week showed inf♋lation continuing to slow, Bank of America 📖forecasts next week’s Personal Consumption Expenditures (PCE) report will show inflation falling to the central bank’s 2% target. 

The bank expects core prices to have risen 0.1% month-over-month in November, which would put the six-month annualized inflation rate at 2%, right in line with 澳洲幸运5开奖号码历史查询:the Fed’s target. The annual inflationᩚᩚᩚᩚᩚᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ⁤⁤⁤⁤ᩚ𒀱ᩚᩚᩚ rate is expected to༒ come in at 3.2%, down from 3.5% in October. 

The bank’s core PCE estimate implies a dramatic divergence from 澳洲幸运5开奖号码历史查询:Tuesday's core CPI print of 0.3%. It attributes that gap to the weight of shelter in each index—17% in core PCE versus 42% in core CPI—and the way PCE calculates medical services costs, which account for about 18% of the index. The PCE’s measure of medical services inflation relies heavily on the 澳洲幸运5开奖号码历史查询:Producer Price Index (PPI), which showed healthcare services infla💝tion slowing dramat🍷ically last month.

Vertex 🐬Pharmaceuticals Ju𝓡mps on Positive Data From Non-Opioid Painkiller Trial

Vertex Pharmaceuticals (VRTX) was the best-performing stock in the S&P 500 early Wednesday after the biotech firm reported pos⛦itive results from a mid-🅰stage trial of an experimental painkiller.

The Boston-based firm said patients with painful diabetic peripheral neuropathy (DPN) reported a meaningful reduction in pain after a 12-week course of Vertex’s NaV1.8 inhibitor VX-548. The results were statistically significant for all three doses tested according to the company. It also said the drug was generally well tolerated, with no serious adverse effects reported at any dosage. 

Vertex said it would work with regulators to advance VX-548 to a phase 3 trial and begin a pha𝐆se 2 trial of the same drug in patients with nerve root damage in the lumbar spine. It is simultaneously undertaking three phase 3 studies of VX-548 in the treatment of acute pain. 

Vertex shares jump♍ed more than 8% Wednesday morning to trade at $386.25, just shy of an all-time high reached last month. 

Stocks Making the Biggest Moves Premarket

Gains:

• Vertex Pharmaceuticals Inc. (VRTX): Shares of the biotech firm gained about 5% after it reported positive results from a phase 2 trial of its non-opioid painkiller in patients with painful diabetic peripheral neuropathy. 
• Take-Two Interactive (TTWO): Shares rose more than 3% after Nasdaq said the video game maker would replace Seagen (SGEN), which is being acquired by Pfizer (PFE) this week, in the Nasdaq-100 Index effective Dec. 18. 
• Airbnb Inc. (ABNB): Shares of the home-sharing company rose more than 1% after it agreed to pay Italian authorities 576 million euros ($621 million) to settle a tax dispute. Italy had alleged the company owed 779 million euros in unpaid taxes. 
  

Losses:

• Pfizer Inc. (PFE): Shares of the pharmaceutical company sank 6% after its 2024 earnings guidance, updated to reflect its Seagen acquisition, fell short of Wall Street’s expectations.
• Southwest Airlines Co. (LUV): Shares of the airline fell 1% after it raised its estimate of current quarter average fuel costs to between $3 and $3.10 a gallon from a prior range of $2.90 to $3 a gallon. 

Stock Futures Up Ahead of Fed Rate Decision

Futures contracts connected to 𒅌the Dow Jones Industrial Average were up 0.1% in premarket trading on Wednesday.

S&P 500 futures were about 0.2% higher.

Nasdaq-100 contracts rose 0.3%.