U.S. equities took a dip on Monday as the dollar surged in price. The S&P 500 Index fell 0.2%, the Dow Jones Industrial Average lost 0.1% and the Nasdaq Composite took a 0.3% hit on yesterday’s action, though defensive telecoms managed to eke out some gains.
As we head into Tuesday’s trading day, a few stocks are making the spotlight. Nvidia Corporation (NASDAQ:NVDA) appears ready to head into the red for 2017 amid some negative news, Ford Motor Company (NYSE:F) is recovering after a lousy Monday and Paratek Pharmaceuticals Inc (NASDAQ:PRTK) is building a big move after unveiling some clinical trial data.
Here’s what to look for today:
Nvidia Corporation (NVDA)
NVDA shares are down this morning on an analyst downgrade.
Specifically, Pacific Crest has downgraded Nvidia from “Sector Weight” to “Underweight” — a few months after putting out an ominous warning note on the company.
Back in December, the analyst firm said there were “dark clouds” on Nvidia’s horizon thanks to excess inventory in desktop graphics cards. The company wrote, “We are cautious on AMD and Nvidia given signs of excess inventory in the desktop graphics card market, particularly with both stocks at multiyear highs,” but maintained its “Sector Weight” rating on NVDA at the time.
In today’s note, GPUs are still in focus, with analyst Michael McConnell saying he worries about “signs of desktop market saturation, lower margins from incremental Nintendo Switch revenue and a possible pause in the company’s datacenter business this summer.” MarketWatch points out that “only 103 of the 702 companies covered by the firm (1.9%) are weighted underweight.”
NVDA stock, which more than tripled in 2016, has had a rough 2017, climbing just 2% to underperform the market. Currently, shares are mired in a weeks-long battle with its 50-day moving average, coiling up for a big move in one direction or another.
Today’s downgrade could be the thing that sends it out of this tight range, with Nvidia shares projecting about 3% lower. The stock’s next big area of technical support is its March and February lows around $95, which would be another 12% lower from Monday’s closing prices.
Ford Motor Company (F)
Ford shares are trying to recover this morning after a one-two punch of bad news on Monday.
F shares dropped nearly 2% on Monday after reporting declining sales for March; Fords auto sales dipped 7%, far worse than its competitors — Fiat Chrysler Automobiles NV (NYSE:FCAU) reported a 5% decline, and General Motors Company (NYSE:GM) actually saw sales improve by 1.6%.
Ford sold just 236,250 vehicles for the month, weighed down thanks to a massive drop in fleet sales. Said Mark LaNeve, VP of U.S. sales and marketing:
“A 17% decline in fleet sales drove the majority of the year-over-year decline as we continue to go up against our heavily front loaded volumes from last year.”
The only pocket of strength? Unsurprisingly, F-Series truck sales, which improved 10% year-over-year and boasted improved transaction sales.
That bad news triggered a drop that, combined with Tesla Inc’s (NASDAQ:TSLA) surprise beat on Q1 deliveries, sent Ford’s market cap below that of Tesla’s for the first time.
Paratek Pharmaceuticals Inc (PRTK)
PRTK is making a huge move after releasing some encouraging news to reveal regarding its latest medication.
The company’s bacterial pneumonia drug yielded positive results during one of the latter stages of a clinical trial. The medication met one of its primary endpoints, the company revealed.
Paratek Pharmaceuticals said the medication — which is a bacterial pneumonia antibiotic omadacycline — was not inferior compared to another drug, the antibiotic moxifloxacin.
The company is expected to file for regulatory approval with the Food and Drug Administration (FDA) during the first quarter of 2018.
PRTK stock skyrocketed 30% in Monday’s after-market trade, and is accelerating Tuesday morning, to the tune of 40%-plus.
