Spot Bitcoin ETFs Are Approved by SEC, Cleared To Start Trading Thursday

January 10, 2024 05:13 PM EST

Spot bitcoin exchange-traded funds (ETFs) are cleared to begin trading Thursday after receiving regulatory approval on Wednesday from the U.S. Securities and Exchange Commission (SEC).

The regulator gave the green light to the following products (and their proposed ticker symbols):

• Blackrock’s iShares Bitcoin Trust (IBIT)
• ARK 21Shares Bitcoin ETF (ARKB)
• WisdomTree Bitcoin Fund (BTCW)
• Invesco Galaxy Bitcoin ETF (BTCO)
• Bitwise Bitcoin ETF (BITB)
• VanEck Bitcoin Trust (HODL)
• Franklin Bitcoin ETF (EZBC)
• Fidelity Wise Origin Bitcoin Trust (FBTC)
• Valkyrie Bitcoin Fund (BRRR)
• Grayscale Bitcoin Trust (GBTC)
• Hashdex Bitcoin ETF (DEFI)

It has been a long road for the approval of a spot bitcoin ETF in the United States. The journey began in 2013 when an entity affiliated with the Winklevoss twins sent the first application for such a financial product to the SEC.

However, it was Blackrock’s (BLK) application for a spot bitcoin product in June last year that gathered momentum behind the idea.

The SEC’s sign-off serves as a significant regulatory seal of approval for the world’s largest crypto asset, likely reducing some investor fears about investing in the space. It not only brings more regulatory safeguards but allows investors to invest with well-established financial firms.

–Kyle Torpey

Equity Indexes Wrap: Magnificent Seven Gain Amid Broad Rally

January 10, 2024 04:17 PM EST

The Dow

Home Depot (HD) led the index, gaining 3.1% after analysts at Wedbush upgraded the stock to “outperform,” citing the reversal of several factors that hurt the home improvement retailer in 2023, including plummeting home sales and a shift in consumer spending from goods to services.

Microsoft (MSFT) gained 1.9% to close just below its record high. 

Salesforce (CRM) rose 1.1% amid reports it was implementing a hiring freeze in its tech and product divisions.

Boeing (BA) found its footing, rising 0.9% as its CEO vowed in an all-hands meeting that the company would approach reviews of its safety and manufacturing with “complete transparency.” 

Apple (AAPL) added 0.6%.

Walgreens Boots Alliance (WBA) led the laggards, falling 2.7%. Intel (INTC), one of several semiconductor stocks to struggle Wednesday, fell 1.2%. 

The S&P 500

Homebuilder Lennar (LEN) added 3.5% after it raised its annual dividend by 33% and authorized an additional $5 billion in stock buybacks. Competitors PulteGroup (PHM) and D.R. Horton (DHI) rose 1.9% and 1.8%, respectively.

Howmet Aerospace (HWM) rose 3.5% after analysts at Trust Securities upgraded the stock to “buy” from “hold” and raised their price target to $74 from $47.

Juniper Networks (JNPR) added 2.1%, climbing for a second day after Hewlett Packard Enterprises (HPE) confirmed it would buy the networking infrastructure company for about $14 billion. Hewlett Packard rose 1.7%, recovering some of yesterday’s losses.

Quest Diagnostics (DGX) led the index’s losers, falling 3.6%. It was followed closely behind by Capital One Financial (COF) and Phillips 66 (PSX), down 3% and 2.8%, respectively.

Etsy (ETSY) lost 2.7% after Goldman Sachs downgraded the stock on consumer spending concerns. 

Estée Lauder (EL) fell 2.6% after fund manager Terry Smith, dubbed “Britain’s Warren Buffett,” sold his fund’s stake in the cosmetics company. 

The Nasdaq 100

Intuitive Surgical (ISRG) jumped 10.3% after reporting better-than-expected preliminary fourth-quarter results. 

Tech and cybersecurity stocks charged higher with Palo Alto Networks (PANW) adding 5.2%, while Atlassian (TEAM) and MongoDB (MDB) each climbed 3.8%. 

The Magnificent Seven were among the index’s best performers. Meta Platforms (META) rose 3.7% after Mizuho Securities raised its price target to $470 from $400.

Nvidia (NVDA) added 2.3% to close at a new all-time high and Amazon (AMZN) gained 1.6% amid reports it would lay off hundreds of employees in its streaming and studio units, as well as at live-streaming subsidiary Twitch. Alphabet (GOOGL) rose 0.9%. 

Chip stocks GlobalFoundries (GFS) and Onsemi (ON) lagged, falling 2.1% and 1.8%, respectively. 

Gilead Sciences (GILD) also fell 1.8% after a California court ruled the company could face negligence claims over delays in the development of new HIV drugs. 

WD-40 Stock Jumps as Profit and Sales Exceed Estimates

January 10, 2024 03:07 PM EST

Shares of WD-40 Co. (WDFC) skyrocketed Wednesday as the maintenance and household products manufacturer posted better-than-expected results on strong demand for its namesake lubricant.

WD-40 reported first-quarter fiscal 2024 earnings per share (EPS) of $1.28, with revenue increasing 12% to $140.4 million for the period ended Nov. 30, 2023. Both exceeded forecasts.

Net sales rose 10% in the Americas to $64.08 million, as sales of WD-40 Multi-Use Product rose 12%. The company noted it benefited from promotional programs. Net sales jumped 20% to $48.75 million in the Europe, India, Middle East, Africa (EIMEA) region, and by 6% to $27.59 million in the Asia-Pacific market.

WD-40 shares on Wednesday soared 14.5% in intraday trading, reaching their highest level since April 2021.

–Bill McColl

TradingView.

Meta, Nvidia Stocks Surge to Close in on Major Milestones

January 10, 2024 02:09 PM EST

Shares of both Meta Platforms (META) and Nvidia (NVDA) jumped Wednesday, putting the Magnificent Seven stocks within striking distance of two distinct milestones. 

Meta was up about 4% Wednesday afternoon, putting it just 4% off both an all-time high and a $1 trillion market cap. Meta became only the fifth U.S. company to reach that milestone in June 2021. That was before the company’s shares peaked at a record high of $384 in September of that year and plummeted to just $89 in November 2022.

Nvidia, meanwhile, was up more than 2%, adding to yesterday’s gains, which carried it to an all-time high. Since entering the $1 trillion club in May, the stock has continued to climb higher. With Wednesday’s gains, Nvidia’s market cap surpassed $1.3 trillion, putting it closer to catching America’s fourth-most valuable company, Amazon (AMZN), which has a market cap of $1.59 trillion.

The difference is considerable; it’s about the size of Netflix ($211 billion), McDonald’s ($211 billion), or Intel ($202 billion). But if any company can close that gap in the blink of an eye, it’s Nvidia, which added $184 billion in one day last May.

Midday Movers

January 10, 2024 01:19 PM EST

Intuitive Surgical (ISRG) shares jumped after the maker of the da Vinci robotic surgical device reported preliminary fourth quarter and full-year revenue that exceeded estimates.

Shares of Lennar (LEN) advanced as the home builder raised its dividend by $0.50 to $2 per share and said it would buy back up to $5 billion in additional stock. Shares of rival home builders gained as well.

Amazon (AMZN) shares gained as the tech giant announced it was cutting hundreds of jobs from its Prime Video, MGM Studios, and Twitch units.

Estée Lauder (EL) shares dropped as Terry Smith, a hedge fund manager known as “Britain’s Warren Buffett,” dumped his stake.

Shares of Gilead Sciences (GILD) declined when a California court ruled it could face claims of negligence over a delay in releasing a safer treatment for HIV.

American Express (AXP) shares slipped as BMO Capital Markets downgraded the stock, saying the banking sector faces headwinds. 

–Bill McColl

Intuitive Surgical Stock Jumps After Company Reports Strong Preliminary Q4 Results

January 10, 2024 12:13 PM EST

Shares of Intuitive Surgical (ISRG) moved sharply higher Wednesday as the maker of the da Vinci robotic surgical device said it anticipates better-than-expected results on a rise in surgical procedures.

The company, in reporting preliminary fourth-quarter results, said revenue rose 17% to $1.93 billion, beating analysts forecasts. Full-year sales climbed 14% to $7.12 billion, also ahead of estimates.

Intuitive Surgical said that worldwide da Vinci procedures jumped 21% in the latest quarter, mainly because eased COVID-19 restrictions in China led to an increase in operations there. 

The company is expected to report final results on January 23.

Intuitive Surgical shares were up 6.5% at $351.98, their highest level since July, in midday trading.

–Bill McColl

Amazon Stock Ticks Up Following Streaming, Studio Layoffs

January 10, 2024 11:39 AM EST

Shares of Amazon (AMZN) rose more than 1% Wednesday morning after the company said in an email to employees it would lay off hundreds of employees in its streaming and studio businesses.

Amazon also announced it would lay off 500 employees at its Twitch live-streaming unit. The cuts represent 35% of all Twitch staff. 

“For some time now the organization has been sized based upon where we optimistically expect our business to be in 3 or more years, not where we’re at today. As with many other companies in the tech space, we are now sizing our organization based upon the current scale of our business and conservative predictions of how we expect to grow in the future,” the company said in a Twitch blog post.

Amazon is also not the only streaming company to pull back on content investment in the last year. Disney (DIS) cut its content budget by $3 billion last February, then cut it another $3 billion in August amid the writers and actors strikes. Netflix (NFLX) in May was reportedly aiming for $300 million in production cuts in 2023.

At the same time, the price of streaming services rose dramatically in the last two years as companies came under pressure to turn a profit after years of bleeding money.

Bitcoin, Coinbase Fall Ahead of ETF Decision

January 10, 2024 10:24 AM EST

Bitcoin slid Wednesday morning to about $45,000 ahead of a long-awaited decision by the Securities and Exchange Commission on a spot Bitcoin ETF.

Crypto advocates have been hoping for a spot Bitcoin ETF for years, and their hopes were thought to be realized for a brief moment yesterday afternoon when the SEC tweeted that it had approved the products. The post was quickly refuted by the regulator and removed from its page.

“The @SECGov twitter account was compromised, and an unauthorized tweet was posted. The SEC has not approved the listing and trading of spot bitcoin exchange-traded products,” tweeted SEC Chair Gary Gensler after the incident.

Bitcoin jumped to nearly $48,000 immediately following the disputed tweet before tumbling to around $45,500. 

Despite the SEC’s assertions that the tweet was false, markets and prospective ETF issuers are all but certain it represents more of a false start than anything else.

Steven McClurg, chief investment officer of Valkyrie, which has an ETF application before regulators, told Bloomberg on Tuesday he is “95% sure that we will be trading [a spot ETF] on Thursday.”

Wednesday is the deadline for regulators to decide whether to approve or deny ARK Invest and 21Shares’ joint ETF application, and many expect the SEC will approve several applications simultaneously to avoid playing kingmaker.

ETF applicants like BlackRock and VanEck, anticipating both approvals and fierce competition, filed a slew of updates with the SEC earlier this week outlining their fee structures, with many offering reduced fees—or waiving them entirely—upon launch. 

Shares of Coinbase (COIN) followed Bitcoin lower, dropping 4.5% in early trading on Wednesday. Still, the crypto exchange, which has been named the asset custodian for several proposed ETFs, has seen its stock soar more than 200% in the past year. 

Stocks Making the Biggest Moves Premarket

January 10, 2024 09:22 AM EST

Gains:

• Intuitive Surgical (ISRG): Shares jumped about 5% after the company said it had placed 415 da Vinci robotic surgical systems in the fourth quarter and 1,370 in all of 2023, increases of 12% and 8%, respectively, over the prior year.
• Toast Inc. (TOST): Shares of the restaurant payment systems provider rose more than 5% to about $20 after Goldman Sachs upgraded the stock to “buy” from “neutral” and set a price target of $24.
• Lennar Corp. (LEN): Shares of the homebuilder gained 2% after it raised its annual dividend by 33% to $2 per share and authorized an additional $5 billion in share repurchases. 

Losses:

• Aehr Test Systems (AEHR): Shares of the company, which makes test systems for semiconductors, plummeted 18% after it cut its fiscal-year revenue forecast amid a slowdown in the electric vehicle market.
• Coinbase Global (COIN): Shares of the cryptocurrency exchange fell 3% after the SEC said a tweet claiming it had approved spot Bitcoin ETFs for trading was false. Other Bitcoin-exposed stocks, like miners Marathon Digital Holdings (MARA) and Riot Platforms (RIOT), were also lower.
• Etsy Inc. (ETSY): Shares of the e-commerce platform slipped almost 2% after Goldman Sachs analysts downgraded the stock to “neutral” from “buy,” saying Wall Street’s estimates fairly reflected the company’s near-term growth prospects. 

Stock Futures Little Changed Ahead of the Bell

January 10, 2024 08:30 AM EST

Futures contracts connected to the Dow Jones Industrial Average were effectively flat about an hour before markets opened on Wednesday.

S&P 500 futures were up less than 0.1%.

Nasdaq 100 futures inched up about 0.1%.

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