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Monday’s Stock Market Gains

Plus500 | Tuesday 22 August 2023

Yesterday’s trading session on Wall Street was characterised by broad gains across major Indices. Traders boosted the share values of some key firms, bringing overall averages upward by the ring of the closing bell. Let’s take a closer look:

An illustration of rising stock charts

Monday’s Market Risers

Yesterday, August 21st, the S&P 500 (USA 500) climbed nearly 0.7%, with the tech-heavy Nasdaq (US-TECH 100) surging by just under 1.6%, supported by share price rises among several companies across different industries, from cybersecurity and biotech to EV’s. Palo Alto Networks, Moderna, and Nvidia all posted impressive results. 

American cybersecurity company Palo Alto Networks (PANW) surprised investors when its Q4 results exceeded expectations. Over the preceding two weeks, markets had speculated as to the reason behind the firm’s decision to move its earnings call to Friday, August 18th, after the bell. Some even though that bad news could be on the way. However, these gloomy predictions were not borne out, and Palo Alto Networks reported favourable earnings, although revenue was slightly missed. On the back of these results along with positive guidance going forward, the firm’s share price saw a 14.7% surge on Monday, August 21st.

Shares of biotech giant Moderna (MRNA) rose more than 9% yesterday as COVID-19 fears reentered the public discourse. Recently, new infections have been surging and yet another variant of the virus has been identified. Due to these factors, perhaps as well as the fact that Moderna is also partnering with China's Carsgen Therapeutics for an experimental cancer vaccine, traders flocked to Moderna over the course of the trading day.

Tech giant Nvidia (NVDA) gained over 8% ahead of its highly-anticipated earnings, due for release on Wednesday, August 21st. Analysts have raised price targets for NVDA seven times in the past week, as enthusiasm surrounding new artificial intelligence technologies continues to trend upward. While it’s unknown how long this interest will last, NVIDIA seems to be riding the cresting wave of investor interest at the moment. 

Yesterday’s gains were spread across a variety of industries, but one leading firm’s rebound was especially sharp. Let’s dive into Tesla’s Monday surge:

Tesla Powers Up

EV giant Tesla (TSLA) surged by more than 7% yesterday, Monday, August 21st, following six straight days of share price drops. A confluence of factors may have contributed to this trend reversal.

In the coming months, this auto industry giant is expected to bring its new Model 3 to market in China. Despite the economic travails currently prevalent in the world’s most populous nation, mass production of the vehicle is expected to commence next month. Furthermore, the much-anticipated Cybertruck is rumoured to be launched in the third quarter as well.

The surge in Tesla’s energy storage sector may also be providing a boost to investor sentiment toward the company. Over the first two quarters of this year, the firm’s battery storage deployment has nearly tripled year over year. 

While recent price cuts may have been dampening investor sentiment in recent weeks, Baird analyst Ben Kallo has pointed to Tesla shares as one of the brokerage’s ‘best ideas’ going forward. Although profit margins may be affected by China’s economic downturn and lower vehicle prices, Tesla’s Full-Self Driving software could provide a boost to the firm’s bottom line. Full Self-Driving is a state-of-the-art driver assistance program, and with further artificial intelligence improvements, more consumers may choose to purchase the software’s monthly subscription or even buy it outright. (Source:Barrons)

All in all, yesterday’s Indices gains were spread across a variety of industries, and it is as yet unclear whether this rally will develop into a full-blown boom or fade away. Investors and traders alike will have to wait and see how the general market mood on Wall Street shifts over the course of coming trading sessions.


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