Stock Market Live November 5: S&P 500 (SPY) on AI Valuation Concerns
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Advanced Micro Devices is down this morning. While the company beat earnings and revenue, Wall Street didn’t like its margin guidance, which only met expectations.
- Private payroll growth grew by 42,000 in October, following a decline of 29,000 in September.
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Live Updates
Updates will appear here as they are published.
Most of the major indices are in the red this morning.
Dow futures are up about 41 points. S&P 500 futures are up fractionally, with the NASDAQ down about 10 points. The SPDR S&P 500 ETF (SPY) is up by half a point.
Markets are still concerned that AI valuations are stretched.
Leading recent AI losses, Palantir (NASDAQ: PLTR) dropped, even after beating earnings estimates with solid guidance to boot. EPS of 21 cents beat estimates of 17 cents. Revenue of $1.18 billion was above estimates of $1.09 billion. While impressive, the market has become nervous about Palantir’s valuation – especially as it trades at 200x forward earnings.
Not helping, Advanced Micro Devices (NASDAQ: AMD) is down this morning.
While the company beat earnings and revenue, Wall Street didn’t like its margin guidance, which only met expectations. EPS of $1.20 was better than the estimates of $1.16. Revenue of $9.25 billion was better than estimates of $8.74 billion. Margin guidance of 54.5% only met Wall Street guidance, with investors hoping for a better number.
Private Payrolls Jumped by 42,000 in October
Private payroll growth grew by 42,000 in October, following a decline of 29,000 in September. The latest number was also above expectations of 22,000.
Trade, transportation, and utilities added 47,000 jobs. Education and health services added 26,000 jobs. Financial services added 11,000. Also, despite the AI boom, information services lost 17,000 jobs. Professional and business services lost 15,000 jobs. And manufacturing lost about 3,000 jobs for the month of October.
Non-farm payroll numbers will be out on Friday, November 7.
Wedbush Reiterated its Outperform Rating on Tesla
Analysts at Wedbush reiterated an outperform rating on Tesla (NASDAQ: TSLA), with a price target of $600.
The firm expects Elon Musk to get overwhelming shareholder support on the potential $1 trillion pay package, despite opposition from some shareholders.
Analysts at Deutsche Bank just reiterated a buy rating on Tesla ahead of a shareholder vote this week. The firm raised its price target by $30 to $470. Shareholders will vote on giving Elon Musk 425 million shares if he hits financial and operational milestones over the next decade. That reward would require Tesla to reach a market cap of about $8.5 trillion and $400 billion in annual EBITDA within the next decade.