Category: Stock Market News

Shares of ManpowerGroup tumbled 9.7% in afternoon trade Monday, after plummeting 13% in the previous session, after the staffing company was downgraded at Credit Suisse, which cited the uncertainty resulting from the U.K. vote to leave the European Union. The combined 22% plunge in two sessions puts it on track for the biggest two-day percentage decline since June 1998. Credit Suisse analyst Anjaneya Singh cut his rating to neutral from outperform, and his stock price target $73 from $88. ManpowerGroup derived 11.1% of its 2015 revenue from the U.K., according to FactSet, which puts it at risk from a sustained decline in the British pound versus the U.S. dollar. The company derived 64.0% of its revenue from Europe. “The result of the U.K. referendum casts uncertainty on the U.K. and E.U. economic trajectories, at the least, in the near to medium term,” Singh wrote in a note to clients. “We view these developments especially concerning as they undermine the core of out outperform thesis on [ManpowerGroup], where we had anticipated the company to reap the benefits of a strengthening recovery in Europe.”

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Oil futures dropped Monday, sending prices to their lowest level in about a week as the U.K.’s vote to leave the European Union raised concerns over a slowdown in energy demand. August WTI crude settled at $46.33 a barrel on the New York Mercantile Exchange, down $1.31, or 2.8%. Futures prices marked their lowest settlement since June 16, according to data from Dow Jones.

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The U.K. was stripped of its AAA credit rating by S&P Global Ratings on Monday after British voters last week voted to pull the country out of the European Union. S&P lowered the rating to AA. “In our opinion, this outcome is a seminal event, and will lead to a less predictable, stable, and effective policy framework in the U.K.,” S&P said, in a news release. The downgrade also reflects worries about the risks of a “marked deterioration” in the U.K.’s external financing conditions given the country’s already elevated gross external financing requirements, S&P said. Competing ratings firms Moody’s and Fitch had lowered the U.K. credit rating ahead of last week’s referendum. S&P also said it was maintaining its negative outlook on the U.K.’s credit rating, citing the risk to the country’s “economic prospects, fiscal and external performance, and the role of sterling as a reserve currency, as well as risks to the constitutional and economic integrity of the U.K. if there is another referendum on Scottish independence.”

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Gold futures climbed on Monday, extending the sharp rally from the previous trading session to hold ground at their highest level in almost two years. Equities losses in the U.S. and Europe, as well as drops in the euro and British pound helped drive investment demand for the precious metal after the U.K. voted last week in favor of leaving the European Union. Gold for August delivery tacked on $2.30, or 0.2%, to settle at $1,324.70 an ounce. Prices saw their highest settlement since July 11, 2014.

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Hard Rock Hotel & Casino Las Vegas said it notified its customers that an investigation into reports of fraudulent activity identified signs of unauthorized access to the resort’s payment card data. The company said people who used cards at certain restaurant and retail outlets at the resort between Oct. 23, 2015 and March 21, 2016 could have been affected. The company said on May 13, it detected the presence of card-scraping malware targeting payment card data, that in some instances identified the cardholder’s name, the card number, the expiration date and internal verification code.

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One beneficiary of the Brexit fallout is the utilities sector, as the Dow Jones Utility Average is surging 1.4% to new record while Treasury yields tumble to multiyear lows. Shares of utility companies tend to offer relatively high and stable dividend yields, so investors often find them more attractive when interest rates are falling. The global macro uncertainty created by the U.K. vote last week to leave the European Union has led to a rally in U.S. Treasurys, which are seen as a safe-haven play, and a drop in yields. The yield on the benchmark 10-year Treasury note fell about 12 basis points to a four-year low 1.460%. Within the Dow utilities, shares of American Electric Power Co. gained 1.2% and NiSource Inc. advanced 0.4%, with both on track to for record closes. Elsewhere, shares of Southern Co. rose 1.6%, Duke Energy Corp. tacked on 1.3% and Public Service Enterprises Group Inc. ran up 1.1%. The implied annual dividend yield for the Dow utilities is 3.1%, according to FactSet, above the S&P 500 dividend yield of 2.3% and more than double the 10-year Treasury yield.

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U.S. stocks are on track to book their worst two-day decline since late-August, when fears about China’s sluggish economy and its volatile stock market sent global equities reeling. On Monday, the Dow Jones Industrial Average was off 314 points, or 1.7%, to 17,097, the S&P 500 index lost 42 points, or 2.1% to 1,995 and the Nasdaq Composite Index was down 124 points, or 2.7%, at 4,582. The Dow’s fall added to a 610 plunge for the blue-chip gauge on Friday and marks its most severe two-day slide since Aug. 24, according to Dow Jones data. It is also the worst two-session slide for the Nasdaq Composite and S&P 500 since late August. The ugly stock slump follows Friday’s historic vote by the U.K. to quit the European Union, which has rattled global markets. Underscoring the intensity of the selloff, the Dow and the S&P 500 traded below their widely followed 200-day moving averages–a key technical threshold that implies that the stock-market benchmarks may have more room to tumble over the long term.

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Intel Corp. may be considering a sale of its antivirus software maker formerly known as McAfee, according to a report in the Financial Times over the weekend, which cited people close to the discussions. Intel had completed the $7.7 acquisition of McAfee in February 2011. The potential sale may be included in the options Intel is considering for its cyber security unit Intel Security, according to the FT report. Intel did not immediately respond to a request from MarketWatch for comment. Intel’s stock, which slumped 2.2% in morning trade, has dropped 11% year to date, while VanEck Vectors Semiconductor ETF has gained 0.2% and the Dow Jones Industrial Average has lost 1.8%.

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The Dow Jones Industrial Average and S&P 500 index have fallen Monday below its widely-watched 200-day moving average in intraday trade for the first time in three months, to join all the other major market indexes below the key technical threshold. Many chart watchers view the 200-day MA as a dividing line between longer-term uptrends and downtrends. The Dow slumped 238 points to 17,162, below the 200-day MA at about 17,241, according to FactSet. The S&P 500 was shedding 1.5% to 2,007, below its 200-day MA of about 2,021. The Nasdaq Composite , Russell 2000 , NYSE Composite Index , Dow Jones Transportation Average and Dow Jones U.S. Total Stock Market Index were all below their respective 200-day MAs.

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Shares of Twilio Inc. , a cloud communications company that went public Thursday, were up 2% Monday morning, bucking the overall stock market slump. The company saw a big pop in shares on its first day, up 90% from the issue price, and saw shares decline slightly Friday, closing at $26.30 compared to $28.79 the previous day, after news of the Brexit results. The S&P 500 was down 1.3% Monday. Other recent initial public offerings were on the uptick Monday, with shares of Global Water Resources up 0.5% and Avexis, Inc. up 2%.

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