Stock Market Live May 5: Will Warren Buffett Tank the S&P 500 (VOO) Today?
Investing
-
Warren Buffett announced he’s stepping down as Berkshire Hathaway CEO effective Jan. 1 of next year.
-
S&P 500 components are reporting mostly positive earnings today.
-
Are you ahead, or behind on retirement? SmartAsset’s free tool can match you with a financial advisor in minutes to help you answer that today. Each advisor has been carefully vetted, and must act in your best interests. Don’t waste another minute; get started by clicking here.(Sponsor)
Live Updates
Live Coverage
Updates appear automatically as they are published.
11:52 am
In world news that could have economic implications, the Israeli Cabinet is reported to approve a plan to “capture” all of Gaza and reoccupy the land of 2.1 million Palestinians — for how long was not said. Israel previously occupied the territory from 1967 through 2005, at which time Israel pulled all of its troops and resettled approximately 9,000 of its citizens out of the area in a bid to establish peace in the territory.
That effort 20 years ago didn’t work out well. But a reoccupation is likely to further inflame sentiment in the region, and stoke increased conflict, with continued negative implications for sea-going traffic transiting the Suez Canal.
11:10 am
More than 5 million borrowers of student loans are currently in default in the U.S., and President Trump wants them to pay up. On Monday, the U.S. Department of Education said it will resume collecting on defaulted student loans, including by placing liens on tax refund checks, paychecks, and Social Security retirement and disability payments.
The likely effect? Billions of dollars vacuumed away from consumer spending (i.e. lower GDP growth), but on the plus side, billions of dollars added to government bank accounts, which could help reduce the budget deficit.
The S&P is still down 0.4%, and the Voo down 0.3%.
10:48 am
As the S&P 500 looks to end its historic, first-time-in-20-years streak of 9 consecutive “up” days, the OPEC+ cartel of oil-producing nations says it may increase oil output by 411,000 barrels per day beginning in June.
Oil prices were already down 9% over the past couple of weeks. An increase in production (i.e. an increase in supply) is likely to push oil prices down even further, lowering global inflation but doing nothing good for the profits of oil stocks.
The S&P is currently down 0.4%, and the Voo is still down 0.3%.
Warren Buffett announced he’s stepping down as head of S&P 500 component Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) on Saturday, naming Greg Abel, vice chairman of non-insurance operations, as his chosen replacement. Berkshire’s board of directors unanimously approved the choice one day later.
The S&P 500 opened 0.8% lower on the news, dragging down the Vanguard S&P 500 ETF (NYSEMKT: VOO) for a 0.7% loss, for now.
The CEO switcheroo will take effect on January 1, 2026. Buffett himself will remain chairman of the board. It’s unusual for an event at just one company, and one telegraphed so far in advance, and, really, so insignificant seeing as it leaves Buffett in charge of his company, to have such a big effect on an entire stock index.
And yet it is. This is probably testimony to how respected Buffett is by value investors, and to their worry that as he draws back from the stock market, perhaps they should be doing likewise.
Earnings
Meanwhile, earnings news is looking mostly positive for index companies today.
Engines-maker Cummins (NYSE: CMI) crushed earnings estimates with a $5.96 per share profit this morning. Chicken-hawker Tyson Foods (NYSE: TSN) likewise beat earnings expectations, reporting $0.92 per share, however the company missed on sales and warned that it was not able to give an accurate forecast for GAAP earnings this year.
Similarly, Zimmer Biomet Holdings (NYSE: ZBH) beat on earnings, but lowered its full-year forecast by $0.25 per share, warning among other things of currency fluctuations and tariffs effects on its international sales.
Analyst Calls
In analyst action, S&P 500 component GE HealthCare (Nasdaq: GEHC) won an upgrade to neutral this morning. Outside the index, Seaport Global upgraded Reddit (Nasdaq: RDDT) stock to buy, citing strong Q1 revenue growth and calling the company “one of the internet’s largest user destinations.”
On the other hand, Phillip Securities downgraded both Microsoft (Nasdaq: MSFT) and Spotify (NYSE: SPOT). Phillip now rates Microsoft only “accumulate,” rather than “buy.” Spotify, however, has been cut to “reduce” (a.k.a. “sell”) on valuation concerns.
Escape Credit Card Debt Quicksand With a 0% Card Today (sponsor)
Looking for a smarter way to tackle your credit card debt? A balance transfer card could be your ticket to financial freedom, finally eliminating your debt once and for all. We’ve assembled a list of the top balance transfer cards available today. Many offer a 0% introductory APR, giving YOU the chance to pay down your balance without the added cost of interest. Even better, many come with no annual fee—so you can focus on eliminating debt and keeping more money in your pocket. Click here to get started today.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.