Stock market today: Stocks extend record-setting rally, Tesla rises ahead of Musk pay decision

US stocks rallied to a record close on Thursday as investors weighed the two-way pull of cooling inflation and a Federal Reserve pullback on interest rate cuts.

The S&P 500 (^GSPC) rose more than 0.2% to close at its latest all-time high. The Nasdaq Composite (^IXIC) popped about 0.3%, as tech stocks led the broader charge higher. It was the fourth consecutive record close for the two indexes. Meanwhile, the Dow Jones Industrial Average (^DJI) fell almost 0.2%.

Fed policymakers' shift from three rate cuts this year to just one hasn't appeared to faze investors, given Chair Jerome Powell's reminder that the projection isn't set in stone. Traders are still pricing in two rate cuts starting in September, according to the CME FedWatch tool.

Read more: How does the labor market affect inflation?

On Thursday, the producer price index for May fell in what appears to be the latest sign that inflation is easing. The reading dropped 0.2% month-over-month after rising 0.5% in April.

Also looming large is the Tesla (TSLA) shareholders' vote on whether to approve a $56 billion pay package for its CEO Elon Musk, a measure which some big investors were against. Overnight Musk said the compensation and the EV maker's move to Texas have been passed "by wide margins." Tesla stock jumped about 3% on Thursday.

Meanwhile, a 12% jump in Broadcom (AVGO) shares lifted the spirits of a market looking to AI and techs to fuel a rally.

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Tech leads stock market rally again

Thu, June 13, 2024 at 4:07 p.m. EDT, Josh Schafer

The stock market is all about tech stocks right now.

On Thursday, a 3% rise in Nvidia (NVDA) and a 12% pop from Broadcom (AVGO) after reporting quarterly results helped spur the broader rally in tech, which led the sector action on Thursday. Microsoft (MSFT) and Apple (AAPL) also hit record highs on Thursday. Tech is the only sector to outperform the S&P 500 (^GSPC) over the past month and is now the leading sector of the year.

Source: Yahoo Finance

Warner Bros. Discovery stock hits record low — here's why

Thu, June 13, 2024 at 3:15 p.m. EDT, Alexandra Canal

Warner Bros. Discovery (WBD) saw shares hit a record low on Thursday, sinking about 7%, after Formula One owner Liberty Global announced plans to acquire WBD's stake in Formula E, the electric car racing series.

The acquisition brings Liberty Global's total stake in the motorsport to 65%, giving it majority ownership.

"We’re excited to take a controlling interest in Formula E, a business we first invested in nearly ten years ago," Mike Fries, Liberty Global CEO, said in a statement. "Formula E has a massive potential for further growth while integrating the most advanced sustainability standards in sports."

The deal, still subject to regulatory approval, is widely expected to close by the end of the year.

The news comes as questions swirl whether or not Warner Bros. Discovery will secure a high-stakes media rights deal with the NBA.

The league's current contract with Warner Bros.' TNT Network (WBD) and Disney's ESPN (DIS) expires at the end of next season. It's possible WBD, which shells out a reported $1.2 billion annually, could lose the rights to its portion of games to Comcast's NBCUniversal (CMCSA). Amazon (AMZN) is also in talks for an exclusive streaming deal through Prime Video.

Sports content is highly desired by media companies looking to gain access to massive audiences of loyal viewers. That allows sports leagues to bid up the price of rights in negotiations.

The NBA's current contract with Warner Bros.' TNT Network and Disney's ESPN expires at the end of next season. (AP Photo / Sam Hodde) (ASSOCIATED PRESS)

According to the Wall Street Journal, NBCUniversal submitted a bid worth around $2.5 billion — more than double what WBD currently pays. The network is close to a deal with the league to show about 100 games per season, with half airing exclusively on its streaming service, Peacock.

Disney, the NBA's other major broadcast partner, would retain its share of the league's media rights after reportedly agreeing to increase its payment of $1.5 billion a year to $2.6 billion in order to renew the deal, according to the report. The company will carry fewer games compared to its current package, although it will be able to stream games on its upcoming ESPN streaming platform, set to launch in fall 2025.

Meanwhile, Amazon (AMZN) is close to securing a streaming rights package through its Prime Video service for a reported $1.8 billion. The Journal said the package includes both regular season and playoff games, plus the league's play-in tournament and a share of conference finals, which would rotate between the media partners.

Notably, WBD has the ability to match third-party offers before the NBA enters into any official agreements. Last week, Warner Bros. reportedly landed the US rights to broadcast the French Open.

Wall Street is still calling for a broadening of the stock market rally

Thu, June 13, 2024 at 2:30 p.m. EDT, Josh Schafer

Wall Street strategists are beginning to provide mid-year outlooks and one thing that stands out at this point is a continued call for broadening of the stock market rally.

Over the past month, various signs of market breadth have begun to deteriorate. After brief signs of broadening earlier this year, Tech led a narrow rally in the S&P 500 in May and is the only S&P 500 (^GSPC) sector to outperform the index over the past month.

But as was the case at the start of the year, strategists see this trend reversing and other areas of the market outside the "Magnificent Seven" joining the rally further.

"We do think the market is due for a broadening," T. Rowe Price chief investment officer Sebastien Page said during a media roundtable on Tuesday.

Page said this isn't a "pound the table" call but something investors should consider allocating to as earnings momentum shifts from massive growth in Big Tech to the other 493 stocks in the market.

A chart in JPMorgan Asset Management's mid-year outlook illuminates this point. By the fourth quarter of 2024, the gap between Magnificent Seven earnings and the rest of the S&P 500 is expected to completely close as both groups post year-over-year earnings growth of 17% in the final three months of the year.

JPMorgan Asset Management chief strategist for the Americas Gabriela Santos admitted there have been "fits and starts" of this rally already, with noted jumps in sectors like Energy (XLE) and Utilities (XLU) this year, but there could still be more room to run.

"I think there has been some realization of this improvement, but not fully," Santos told Yahoo Finance at a roundtable with reporters. "And I do think it will take second quarter [earnings reports], right? Let's see."

Tracking for an 'A+ report' on the Fed's preferred inflation gauge

Thu, June 13, 2024 at 1:40 p.m. EDT, Josh Schafer

Another reading of inflation came in softer than expected in May. On Thursday, the Producer Price Index (PPI) came in lower than estimates across all metrics.

"Core" PPI, which excludes the volatile food and energy categories, was unchanged from the prior month, below economists' expectations for a 0.3% increase.

This followed Wednesday's update on consumer prices, which showed core CPI increased 0.2% month over month, the lowest reading since June 2023.

Combining the various metrics within the release, economists believe this points to a positive reading of the Fed's preferred inflation gauge within the Personal Consumption Expenditures index later this month.

Bank of America US economist Stephen Juneau wrote Thursday's PPI supports their view that "disinflation is the most likely path forward" and points to an "A+ report" for May core PCE. BofA estimates core PCE increased 0.16% month over month in May.

"The May CPI and PPI data are favorable for our view that the Fed will be reducing its policy rate later this year," Juneau wrote. "We see recent inflation data as greatly reducing the likelihood that the Fed has to raise rates and view labor market data as indicating that the probability of fast rate cuts is also low.

"An easing cycle that begins in September remains a possibility, particularly if shelter inflation were to moderate further in the next couple of months, but we continue to see a December cut as more likely."

Trending tickers on Thursday

Thu, June 13, 2024 at 12:50 p.m. EDT, Ines Ferré

Tesla (TSLA)

Tesla stock popped 4% on Thursday as investors awaited a vote on CEO Elon Musk's $56 billion pay package.

Broadcom (AVGO)

Broadcom stock hit new highs after the chipmaker posted more-than-promising fiscal second quarter earnings results. The company also announced a 10-for-1 stock split.

Super Micro Computer (SMCI)

Super Micro Computer occupied the No. 2 slot on Yahoo Finance's Trending Tickers page on Thursday as shares jumped about 10%.

The provider of servers and storage systems for data centers has been riding high on increased demand amid an AI craze. The stock is up almost 200% year to date.

Takes from 3 Tesla shareholders: Unenthusiastic yes to unequivocal no as Musk awaits vote on his pay

Thu, June 13, 2024 at 12:05 p.m. EDT, Ines Ferré

Yahoo Finance's Yasmin Khorram reports:

Tesla (TSLA) shareholders are answering a $56 billion question today at their annual meeting: Should Elon Musk's record pay package be reinstated after a Delaware judge struck down a previous one?

“I’m voting yes unenthusiastically; I’m voting yes out of principle,” early investor Ibrahim AlHusseini told Yahoo Finance. Personal feelings aside, he said Tesla should honor the 2018 package that was tossed.

“That was the deal. Elon hit the milestones, so he should get his compensation.”

AlHusseini, founder of VC firm FullCycle, invested in the electric vehicle company in a Series C funding round in 2006. AlHusseini said he steadily sold off a majority of his position in the decade that followed.

"We rode the shares through a trillion-dollar valuation. A lot of wealth got created, and his compensation was set by the board,” AlHusseini added, though he thinks most of his peers will vote no this time.

But retail investors currently own around 40% of Tesla stock, and Musk claims they support his pay. Last weekend, the billionaire posted on X, formerly known as Twitter, that “roughly 90% of retail shareholders who have voted” have voted in favor of the package, adding that “public sentiment is unequivocally supportive.”

Tesla shares were up 4% on Thursday.

Read more here.

Bitcoin sinks 4% to hover at $66,500 per token

Thu, June 13, 2024 at 11:48 a.m. EDT, Ines Ferré

Bitcoin (BTC-USD) fell more than 4% on Thursday to hover near its June low. The cryptocurrency traded at around $66,500 per token at 11:45 a.m ET.

Crypto-related stocks were also sliding.

Coinbase (COIN) fell 4% while MicroStrategy (MSTR) dropped more than 6%. Crypto miner Marathon Digital (MARA) also slipped 4%.

Tax cuts vs 'direct investments': Trump and Biden make dueling pitches to business leaders

Thu, June 13, 2024 at 11:00 a.m. EDT, Ines Ferré

Yahoo Finance's Ben Werschkul reports:

Both the Trump campaign and the Biden administration are offering an outreach to the business world Thursday with dueling events that crystallize their different promises to corporate America should they win the election.

Both are in a sense offering carrots, just of a different flavor.

Donald Trump, who is set to meet Thursday morning with a group of prominent CEOs in Washington, D.C., is supremely focused on tax cuts as well as cutting government regulations.

The promise from Biden's team is that a second term would be focused, as Treasury Secretary Janet Yellen is set to say in a Thursday speech to New York business leaders, on "public interventions to create a supportive environment for business and fuel private sector investments."

It remains to be seen which approach resonates with both the overall business community and with the public at large.

But many CEOs have signaled a close focus on taxes in the coming year ahead of the expiration of key provisions in the 2017 Trump tax cuts set for the end of 2025.

Read more here.

Nvidia and Broadcom touch new highs

Thu, June 13, 2024 at 10:20 a.m. EDT, Ines Ferré

Nvidia (NVDA) shares gained as much as 3% on Thursday to touch new all-time intraday highs after peer chipmaker Broadcom (AVGO) posted upbeat quarterly results boosted by AI demand.

Broadcom also announced a 10-for-1 stock split, sending shares to record highs on Thursday. The key supplier to Apple (AAPL) is on track for its biggest gain since 2020.

S&P 500, Nasdaq inch higher as Tesla pops 5%

Thu, June 13, 2024 at 9:32 a.m. EDT, Ines Ferré

The Nasdaq and S&P 500 held near record highs on Thursday as investors digested the Federal Reserve's inclination to cut rates only one time this year while tech shares gained.

The S&P 500 (^GSPC) edged up 0.2% after the benchmark topped 5,400 to close at a fresh all-time high. The Nasdaq Composite (^IXIC) popped 0.6% on the heels of taking out a record of its own as tech stocks led the broader charge higher.

The Dow Jones Industrial Average (^DJI) edged lower, down 0.3%.

Tesla (TSLA) shares opened 5% higher after Elon Musk indicated two important shareholder votes, one of which included his $56 billion pay package, had passed "by wide margins."

The Federal Reserve hinted at just one rate cut later this year, pulling back the market's expectation of at least two reductions. The Federal Open Market Committee (FOMC) held rates unchanged on Wednesday after its two-day meeting. The decision came on the heels of the latest Consumer Price Index, which signaled cooling inflation for the month of May.