7 hours ago
CrowdStrike shares plummet on news Delta Air Lines is seeking damages after blackout
Delta Air Lines has hired attorney David Boies to help it seek damages from CrowdStrike and Microsoft after an outage earlier this month caused thousands of flights to be canceled, CNBC reported.
Following the news, reported by CNBC’s Phil LeBeau, CrowdStrike shares fell 5%. Microsoft shares fell less than 1%.
The outage occurred after a CrowdStrike software update caused a major outage on Microsoft systems on July 19, costing Delta an estimated $350 million to $500 million.
CrowdStrike shares fell more than 32% in July.
Read more from CNBC’s Jordan Novet and Ari Levy here.
—Darla Mercado
8 hours ago
S3 Partners says U.S. homebuilding stocks ‘more vulnerable to stress’ as buying momentum picks up
Homebuilding stocks “should come under more pressure as rising consumer demand for housing boosts long-term buying momentum and stock prices,” according to a recent note from Igor Dusaniwski, managing director of predictive analytics at S3 Partners.
This trend has likely already begun, with S3 observing that “short selling in homebuilding stocks has trickled in over the past seven days, with $40 million worth of short selling covered.”
“The short selling activity seen over the past 30 days should reverse given the significant mark-to-market losses suffered by short sellers,” Dusaniwski wrote. Short positions in homebuilding stocks have lost $959 million in mark-to-market value terms, or about 18%, so far this year, S3 said. “More than 60% of short homebuilding stocks will be trading unprofitably in 2024,” the research firm that specializes in tracking short selling said.
The $2 billion SPDR S&P Homebuilders ETF is up more than 16% so far in July and is projected to gain nearly 23% in 2024. The S&P 500 was little changed in July and is projected to gain 14.5% in 2024.
See the chart…
2024 SPDR S&P Homebuilders ETF.
8 hours ago
UBS says tech stocks may find support ahead
The technology sector may get some help soon, according to UBS.
Mark Haefele, investment chief at UBS Global Wealth Management, expects the recent market volatility to continue as investors continue to sell off tech stocks into other interest-rate sensitive assets.The Nasdaq Composite is the only major index headed for a down month.
But he added that the recent sell-off could also present an attractive entry point for the sector. Over the past decade of market history, global tech stocks have experienced at least one 10% drop each year and then recovered in the six months since. The only notable exception was during the 2017 bull market.
“The tech sector should find support in the coming weeks and regain control,” Haefel wrote. “Indeed, we see the recent sell-off creating a re-entry opportunity, especially for companies with earnings growth prospects.”
Sarah Min
9 hours ago
Investors are placing a higher premium on stocks with lower earnings than usual.
Companies that reported disappointing quarterly results are being hit harder than usual this earnings season.
According to FactSet, when second-quarter earnings fell short of expectations, stock prices fell an average of 3.8% from the two days before to the two days after the quarterly earnings announcement, compared with an average five-year decline of 2.3% for companies that missed expectations.
Stocks that beat Wall Street expectations delivered lower-than-average returns, rising just 0.3% over the same period, according to FactSet. That compares with an average five-year price increase of 1%, FactSet said.
Yun Lee
