Key Takeaways

• UnitedHealth Group will report earnings before the market opens Tuesday.
• The insurer’s Optum division will be in focus as a key driver of revenue growth.
• Investors will also likely be watching for updates on UnitedHealth’s recent lawsuit related to the ratings of its Medicare Advantage plans.

UnitedHealth Group (UNH) will report third-quarter earnings before the opening bell Tuesday, with investors likely to be watching for continued growth from its Optum division.

The health insurer is expected to post third-quarter revenue of $99.3 billion, an over 7% increase year-over-year, and net income of $6.16 billion, up from $5.84 billion in the prior-year quarter.

Key Metric: Optum Revenue

Last quarter, revenue from UnitedHealth’s Optum division jumped 11.7% year-over-year to $62.9 billion as it added more patients at Optum Health and raised the number of customers using its Optum Rx pharmacy service. 

Analysts expect $63.7 billion this quarter, which would represent a 12% increase. The number of Optum Health patients and those using the OptumRx pharmacy service are also expected to grow from the year-ago quarter.

Business Spotlight: Medicare Advantage

UnitedHealth may also provide updates on its lawsuit against the Centers for Medicare & Medicaid Services (CMS) after the agency downgraded the quality rating of its Medicare Advantage plans.

UnitedHealth alleges that CMS lowered its ratings “based on an arbitrary and capricious assessment of how [UHC’s] call center handled a single phone call that lasted less than ten minutes,” according to a complaint filed in a Texas district court.

The company had 7.7 million members on Medicare Advantage plans at the end of the second quarter. That could change with the open enrollment period beginning on Oct. 15.

UnitedHealth shares have gained nearly 14% in 2024 so far, at $598.05 as of Friday’s close.

Read the original article on Investopedia.

Key Takeaways

• The S&P 500 added 0.6% on Friday, Oct. 11, reaching an all-time closing high following softer-than-expected wholesale inflation data.
• Tesla stock lost ground after the carmaker’s highly awaited robotaxi event failed to impress investors. The lukewarm reaction helped lift shares of Uber and its ridesharing peers.
• Bank earnings season got underway, with shares of Wells Fargo and JPMorgan advancing after the financial giants released strong results.

Major U.S. equities indexes ticked higher during the week’s final trading session as the latest Producer Price Index (PPI) data showed wholesale prices remained flat in September after rising 0.2% in the previous month.

The decline in wholesale inflation suggests relatively limited upward pressure on consumer prices in the coming months, which might influence the Federal Reserve as it considers additional interest-rate cuts.

The S&P 500 gained 0.6%, closing above 5,800 for the first time in the benchmark index’s history. The Dow surged 1.0%, joining the S&P 500 in printing a record close. The Nasdaq was up 0.3%. 

Tesla (TSLA) made headlines with an event held Thursday evening to unveil its Cybercab, the electric vehicle maker’s highly anticipated autonomous robotaxi. However, the launch failed to impress investors, and Tesla shares tumbled 8.8% on Friday, suffering the heaviest loss of any S&P 500 stock. Bernstein analysts commented on the lack of detail provided by Tesla, particularly in terms of the regulatory approval process and central monitoring functions for robotaxis. Analysts also hoped for more specifics on safety measures and compatibility with other Tesla EVs.

The lukewarm response to Telsa’s Cybercab helped boost shares of ridesharing companies that will face competition from the implementation of self-driving taxis. Uber Technologies (UBER) shares jumped 10.8%, notching the top performance in the S&P 500 and hitting a record high. Shares of Uber rival Lyft (LYFT) were up 9.6%.

Fastenal (FAST), a producer of nuts, bolts, screws, and other industrial supplies, topped analysts’ estimates with its sales and profit results for the third quarter. Solid demand for the company’s safety products helped drive the strong results, even as Hurricane Helene caused a disruption to sales. Fastenal shares ended 9.8% higher on Friday.

Shares of industrial maintenance, repair, and operation (MRO) supplier W.W. Grainger (GWW) popped 5.8% to reach an all-time high. In its most recent earnings report, released in August, Grainger reported year-over-year sales growth, boosted by strength in its High-Touch Solutions and Endless Assortment segments.

Bank earnings season kicked off on Friday as two of the country’s largest financial institutions released quarterly results, with more companies set to follow suit next week. Wells Fargo (WFC) shares jumped 5.6% after the bank reported better-than-expected revenue and net income for the third quarter.

JPMorgan Chase (JPM), the world’s largest bank by market capitalization, also beat top- and bottom-line forecasts while reporting year-over-year gains in net interest income (NII), and its shares added 4.4%. Shares of Bank of America (BAC), which is set to release results on Tuesday, were up 5.0%.

A.O. Smith (AOS) shares dropped 6.3% after the water heater and boiler manufacturer reported lackluster preliminary results for the third quarter, predicting sales and earnings per share (EPS) to come in below consensus estimates. The company also reduced its full-year profit guidance, citing weak demand for residential and commercial water heaters in North America as well as a cautious outlook for Chinese markets during the second half of the year.

Shares of Align Technology (ALGN), maker of orthodontics products, fell 3.3% after Stifel cut its price target on the stock. Analysts also lowered their full-year revenue and earnings estimates, indicating that they do not expect Align to reach an inflection point in the near term.

Read the original article on Investopedia.

Key Takeaways

• Shares of Uber and Lyft jumped on Friday after Tesla’s introduction to its new robotaxi failed to live up to ridesharing investors’ fears.
• Analysts noted Tesla’s much-anticipated event was light on details about the rollout of a ridesharing app that would compete with Uber or Lyft, lifting an uncertainty that has hung over the stocks for months.
• Uber shares hit an all-time high, while Tesla slumped further into negative territory for the year.

Shares of Uber Technologies (UBER) jumped to a record high on Friday after Tesla’s (TSLA) much-anticipated robotaxi launch event failed to live up to ridesharing investors’ fears.

Tesla on Thursday evening unveiled its CyberCab, an autonomous car designed for ridesharing, and a 20-seater “RoboVan.” CEO Elon Musk said the CyberCab would cost less than $30,000, and described a vision of individuals operating fleets of CyberCabs as an alternative to driving one car through either Uber or Lyft.

Tesla’s ‘Toothless’ Robotaxi Event a Positive for Uber

Analysts were disappointed by the event, noting it was lighter on details than many Uber and Lyft investors had feared. Jefferies analysts in a note to clients called the CyberCab “toothless,” and said the event was a “best-case outcome for Uber.” 

Tesla, the analysts wrote, didn’t “provide verifiable evidence of progress” on autonomous vehicles (AV), and that Uber was “uniquely positioned to support sustainable growth for AV developers.” Jefferies has a “buy” rating on Uber stock.

Bank of America analysts noted that some risks remain, including the potential for RoboVans and CyberCabs to cost significantly less to operate than a conventional rideshare. However, Tesla gave “no specific business model” for a rideshare app that would compete with Uber or Lyft. They maintained their “buy” rating on Uber.

Uber stock was up nearly 10% at $85.66, an all-time high, on Friday afternoon. Shares of competitor Lyft (LYFT) also jumped almost 10%. Tesla shares slumped, putting them down 12% since the start of the year.

Read the original article on Investopedia.

Key Takeaways

• Stellantis shares lost ground Friday after the automaker announced a shakeup of its management as it tries to recover from a sales slump.
• The changes included replacing CFO Natalie Knight with China COO Doug Ostermann.
• The company said the changes were made to “redouble” its focus on key priorities and address global challenges facing the industry.

Stellantis (STLA) shares lost ground in early trading Friday after the “Big Three” automaker announced an executive shakeup as it tries to recover from a sales slump.

The parent of the Jeep, Chrysler, and other brands said CFO Natalie Knight is leaving the company, and will be replaced by the firm’s China COO Doug Ostermann. Alfa Romeo brand CEO Jean-Philippe Imparato will also become CEO of the Enlarged Europe division, succeeding Uwe Hochgeschurtz, who is also departing. Antonio Filosa, head of South American operations, will be North America COO, succeeding Carlos Zarlenga, “whose next position will be subject to a further announcement.” 

Other changes included appointing Gregoire Olivier COO in China and Santo Ficili as CEO of Maserati and Alfa Romeo.

Stellantis said the moves were designed “to redouble the Company’s focus on its key business priorities and confront head-on the global challenges facing the industry.”

A ‘Darwinian Period for the Automotive Industry’

CEO Carlos Tavares called this a “Darwinian period for the automotive industry,” and said the new management team is expected to help “tackle the challenges ahead.” 

Stellantis has been reeling from a slowing car market, excess inventory, and Chinese competition. Last month, the automaker cut its outlook. Last week, it posted a significant drop in U.S. sales. Barclays downgraded the stock following the news, warning it sees no real recovery for Stellantis until at least the first half of next year. 

Shares of Stellantis were down about 3% in early trading Friday and have lost more than 40% of their value since the start of the year.

Read the original article on Investopedia.

Key Takeaways

• Tesla unveiled its highly anticipated “Cybercab” robotaxi at its “We, Robot” event Thursday. 
• The electric vehicle maker also introduced a Robovan, that can seat up to 20 passengers at a time or be used to transport goods.
• CEO Elon Musk said Tesla’s fully autonomous driving capabilities will come to Texas and California by next year with the Model 3 and Model Y, with the Cybercab in production by 2026. 
• Tesla also showcased its Optimus humanoid robot, which Musk said he believes could become “the biggest product ever, of any kind.” 

Tesla (TSLA) unveiled its highly anticipated “Cybercab” robotaxi, “Robovan,” and more at the electric vehicle maker’s “We, Robot” event Thursday. 

CEO Elon Musk, who rolled into the event at Warner Bros. Studios in Burbank, California in a Cybercab to demonstrate its fully autonomous capabilities, said the vehicle comes without a steering wheel or pedals, and can be charged wirelessly. 

Musk said the Cybercab will enable “individualized mass transit,” and could help bring down transit costs, among other benefits. It will become available for purchase for under $30,000, he said, describing a future in which owners could manage fleets of the vehicles. 

Tesla also revealed a larger robotaxi called a Robovan, that can seat up to 20 passengers at a time, or be used to transport goods. 

Fully Autonomous Driving in Texas and California by 2025

Musk said he expects Tesla’s fully autonomous driving capabilities will come to Texas and California by next year with the Model 3 and Model Y, with the Cybercab in production by 2026. 

Musk suggested that autonomous driving supported by artificial intelligence could also make driving 10-20 times safer, and invited attendees at the event to take rides in the Cybercab and Robovan. 

‘The Biggest Product Ever, of Any Kind’

Musk showcased Tesla’s Optimus humanoid robot as well, with some helping serve drinks, dance, and perform other functions at the event.  

Musk said he believes the humanoid robot, which will become available for between $20,000 and $30,000, could become “the biggest product ever, of any kind.” 

While a release date was not offered, the CEO has previously said Optimus already performs some “simple factory tasks” in Tesla’s labs, could be expected to be in Tesla’s factory by the end of 2024, and may be ready for external sale by the end of 2025.

Tesla shares were little changed in extended trading following the announcements. While Tesla shares have mostly recovered from a steep selloff in the first half of the year, they remained about 4% lower for 2024. 

For years, Musk has been saying a fully autonomous Tesla vehicle could be coming soon, and the announcements come after the event was delayed from its original date in August, adding more pressure on Tesla to impress with fresh developments worth the wait.

Tesla could provide more details about its plans along with its third-quarter financial results after the closing bell on Oct. 23.

CORRECTION—Oct. 10, 2024: This article has been corrected to reflect Tesla’s fully autonomous driving capabilities are expected in Texas and California by next year.

Read the original article on Investopedia.

Key Takeaways

• Shelter inflation has been a stumbling block for the Federal Reserve in its fight against inflation.
• The Consumer Price Index showed housing inflation rose more slowly in September for both renters and homeowners.
• Prices for newly signed leases have been growing below pre-pandemic levels, but they may just now be beginning to show up in inflation data.

Housing inflation has remained stubbornly high. But that could be changing.

Shelter inflation has been a stumbling block for the Federal Reserve’s fight against inflation, remaining sticky despite overall price pressures alleviating.

Many economists and central bankers have expected government measures of housing costs to fall for months. Inflation measures notoriously lag behind private company data, which shows rent increases have dramatically slowed. The Bureau of Labor Statistics on Thursday released data showing shelter costs rose 4.9% over the year, the slowest increase since March 2022 and a reversal from August’s sharp uptick.

For some Fed officials, this could be the data they had been waiting to see. At an event before the inflation data was released, Minneapolis Federal Reserve Bank President Neel Kashkari said officials were happy with overall pricing trends but were still waiting for housing inflation to cool.

“We think we have a lot of confidence that housing inflation should continue to trend down because we can look at new rents,” Kashkari said. “New rental inflation is way down. That takes 12 to 24 months to roll over into housing inflation.”

At a bankers’ conference earlier this week, Boston Fed President Susan Collins described shelter as the “stickiest” component to inflation and noted that it was still above its pre-pandemic averages.

“There are good reasons to think that this stickiness in current shelter inflation reflects existing rents still catching up to new market rents,” Collins said. “Rent growth for newly signed leases has been at or below its pre-pandemic range for many months.”

Read the original article on Investopedia.

Key Takeaways

• Oracle shares hit a record high Wednesday on growing investor enthusiasm for the company’s reach into the artificial intelligence market.
• The stock traded in a three-year rising wedge before staging a decisive volume-backed breakout above the pattern last month, though the RSI indicator warns of overbought conditions.
• Investors should monitor important lower levels on Oracle’s chart around $146, $127, and $100, while also watching a bars pattern bullish price target around $250.

Oracle (ORCL) shares hit a record high Wednesday following a report that ChatGPT maker OpenAI is looking beyond Microsoft (MSFT) to supply servers, paving the way for a potential new partnership with the enterprise software giant.

Tech industry focused publication The Information reported that OpenAI’s leadership recently told staff that the company planned to take on a larger role in securing data centers and artificial intelligence (AI) chips, rather than relying exclusively on Microsoft.

In June, the company rented Oracle servers at a new data center in Texas with limited input from Microsoft, according to the report. At the time, OpenAI’s CEO Sam Altman said that the software company’s Oracle Cloud Infrastructure (OCI) would allow it to scale, while Oracle CEO Larry Ellison pointed out that AI leaders such as OpenAI are turning to the company for its fast, cost-effective AI infrastructure. 

Oracle shares have surged around 25% in the past month and gained nearly 70% year-to-date through Wednesday’s close, boosted in part by a recent multicloud partnership with Amazon’s (AMZN) cloud business.

The stock rose 2.3% to close Wednesday’s session at $178.29, after hitting an all-time high of $178.61.

Below, we take a closer look at Oracle’s weekly chart and use technical analysis to point out important price levels to watch out for.

Rising Wedge Breakout

Oracle shares traded within a three-year rising wedge before staging a decisive volume-backed breakout above the pattern last month.

Since that time, the stock has continued to trend sharply higher, though share turnover has decreased following the initial breakout.

While, the relative strength index (RSI) confirms bullish price momentum, it also cautions of short-term overbought conditions with a reading above 80. It’s worth pointing out that the last time the indicator flashed above this threshold in June last year, the stock underwent a correction of around 22% over the following six months.

We’ll now identify three important lower chart area that could come into play during pullbacks and use a bars pattern to project a price target if the stock continues its long-term uptrend.

Lower Chart Levels to Watch

The first location to monitor sits around $146, an area on the chart where the shares could find initial support around the July swing high and wedge pattern’s top trendline.

Selling below this level could see the shares revisit the $127 level, a region just below the wedge’s lower trendline that would likely encounter support from multiple highs on the chart between June 2023 and May this year, which also closely aligns with the 2024 August low and upward sloping 50-week moving average (MA).

A deeper correction could bring the psychological $100 round number into play. Investors would likely look for buying opportunities in this area near the closely-watched 200-week MA and prominent peaks and troughs that formed on the chart from October 2021 to December last year.

Bars Pattern Price Target

A bars pattern uses historical trends to predict future moves. To apply this technique on Oracle’s chart, we take the stock’s trend higher from October 2022 to June last year and overlay it from the August low, which projects a price target of around $250.

We selected this earlier trending period because it began from the rising wedge’s lower trendline, similar to how the stock’s current move higher started. Interestingly, the prior trend played out over 36 weeks, meaning a comparable move could potentially last until early April if price history were to rhyme.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our warranty and liability disclaimer for more info.

As of the date this article was written, the author does not own any of the above securities.

Read the original article on Investopedia.

Key Takeaways

• About 2.8% of the U.S. Gross Domestic Product lies in the path of Hurricane Milton, one estimate showed.
• The analysis showed that while it is difficult to calculate, Milton could have a measurable impact on GDP.
• Atlanta Fed President Raphael Bostic said he was monitoring the economic impact of recent storms in his district and warned that increased insurance costs from weather disasters were becoming a “big problem.” 

As Florida prepares for the devastation of another powerful storm, Hurricane Milton’s economic consequences could be felt throughout the U.S. economy.

The Category 3 storm is expected to make landfall in central Florida late Wednesday evening. According to an analysis from Oxford Economics, approximately 2.8% of the U.S. Gross Domestic Product (GDP) is in Milton’s path. Parts of Florida and its southeast neighbors are still recovering from damages caused by Hurricane Helene nearly two weeks ago.

The damage from the powerful hurricane could be a drag on fourth-quarter GDP, though the true economic impact of storm damage can be difficult to estimate, Oxford analysts said. An estimate from Jeffries anticipated tens of billions of dollars in property damage and lost business from the storm. 

“The economic costs of Milton are highly uncertain, and hopefully, the storm isn’t as bad as feared,” wrote Ryan Sweet, chief economist at Oxford Economics.

This Fed Official Is Keeping An Eye on the Hurricane

Atlanta Federal Reserve Bank President Raphael Bostic said at an event Tuesday that he was monitoring the economic ramifications of Hurricanes Helene and Milton. The Federal Reserve Bank of Atlanta district includes Florida, Georgia, and parts of Tennessee, Louisiana, and Mississippi.

“I’m hopeful that Milton does not inflict the same sort of carnage that Helene did,” Bostic said of the storms. “Those also have significant implications on how the economy is going to perform, and these things are out of the Federal Reserve’s hand. What we have to do is make sure we’re ready.”

Already, the economic consequences of Hurricane Helene are expected to reduce October employment numbers by 40,000 to 50,000, and Milton will likely add to those totals, the Oxford Economics report said.

Bostic said the economic effects of the hurricanes could persist for six months or more and the Federal Reserve will need to formulate an appropriate policy strategy to respond.

Read the original article on Investopedia.

Key Takeaways

• Shares of Constellation Energy, NRG Energy, and Vistra fell Wednesday as analysts questioned if utilities stocks can hold onto their recent momentum.
• All three stocks retreated from record highs posted at the end of last week on optimism about growth opportunities fueled by demand for energy to power artificial intelligence.
• Despite Wednesday’s declines, all three stocks remained solidly in positive territory for 2024.

Shares of power generators Constellation Energy (CEG), NRG Energy (NRG), and Vistra (VST) posted some of the steepest losses in the S&P 500 on Wednesday. The declines came after all three stocks ended last week with record highs on enthusiasm about opportunities to benefit from growing energy demand for data centers to support artificial intelligence (AI).

The retreat for the red-hot electric utility stocks came as several analysts expressed concerns about the sustainability of their valuations following massive AI-driven gains this year.

BTIG Analysts Warn Utilities Could Be Set for Correction

Although many analysts remain bullish about the upside potential for companies like Constellation, NRG, and Vistra as they could help meet the large energy demand needed to power AI, BTIG analysts suggested utilities could be set for a correction of around 7% to 10%.

According to BTIG’s analysis, the sector’s valuation appears “stretched” relative to its historical levels, and utilities tend to drop off following periods of outperformance versus the broader markets.

SentimenTrader’s Jason Goepfert echoed that utility stocks have a history of reversing their momentum after strong runs, and added any cracks in the “new narrative about AI” could hit confidence in returns.

Constellation Energy Leads S&P 500 Losses Wednesday

Constellation Energy was the weakest performer of any S&P 500 stock Wednesday, plunging 6.1%. NRG Energy shares dropped 5.3%, while Vistra stock slipped almost 3%.

Despite the declines, all three stocks remained solidly in positive territory for 2024. Constellation shares have more than doubled in value since the start of the year, while NRG stock is up more than 70%. Vistra, meanwhile, remains the S&P 500’s top-performing stock this year, having more than tripled in value over the period.

Read the original article on Investopedia.

Key Takeaways

• Nvidia shares are nearing their all-time highs on continued optimism about sales of its artificial intelligence (AI) products.
• Foxconn said demand for Nvidia’s Blackwell system was “awfully huge.”
• Nvidia executive Bob Pette said with AI will “revolutionize” industry everywhere.

Shares of Nvidia (NVDA) are nearing their all-time highs Wednesday morning on positive news about the chipmaker’s artificial intelligence (AI) products.

Nvidia shares, which have ended higher the past five sessions, recently edged up to $133.30. Their all-time closing high is $135.58, achieved on June 18, and record intraday high is $140.76, recorded the following session two days later, after markets were closed for Juneteenth.

On Tuesday, contract electronics manufacturing giant Foxconn reported strong demand for its servers powered by Nvidia’s GB200 semiconductors, part of the latter’s Blackwell architecture. Microsoft announced it was “the 1st cloud” running the Blackwell system with GB200-powered AI servers. OpenAI also thanked Nvidia for delivering “one of the first engineering builds of the DGX B200 to our office.”

Nvida Says Blackwell Slashes Energy Consumption

Also yesterday, Nvidia noted that the Blackwell platform has slashed energy consumption by up to 2,000 times over the last decade for AI training models such as OpenAI’s GPT-4.

Bob Pette, vice president and general manager of Nvidia’s enterprise platforms, told participants at the company’s AI Summit that “We are in the dawn of a new industrial revolution,” adding that the firm is “designing our systems with not just performance in mind, but with energy efficiency in mind.”

Nvidia shares have soared about 170% this year.

Read the original article on Investopedia.