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Stock market today: Dow extends slide as Salesforce plunges, rate jitters rattle tech

US stocks endured more losses on Thursday as lingering concerns about higher-for-longer interest rates and a Salesforce (CRM) sell-off dampened investors' spirits.

The Dow Jones Industrial Average (^DJI) sank nearly 0.9%, or more than 350 points, after shedding over 400 to lead Wednesday's stock market slide. The S&P 500 (^GSPC) fell 0.6%, while the tech-heavy Nasdaq Composite (^IXIC) dropped about 1%.

Stocks have lost steam amid renewed gloom about the odds for rate cuts, stoked by data showing less cooling in inflation than the Federal Reserve wants. At the same time, hopes that Nvidia's (NVDA) blockbuster earnings would spur a broader stock rally were disappointed.

Leading the way down on the corporate front Thursday was Salesforce (CRM), whose results sparked other worries about likely losers in the AI boom. The software maker's shares slid nearly 20% after it said sales growth would stall to the slowest in its history, its most significant decline since 2004.


Meanwhile, new government data showed that the US economy grew at a slower pace than initially thought during the first quarter. The Bureau of Economic Analysis's second estimate of first quarter US gross domestic product (GDP) showed the economy grew at an annualized pace of 1.3% during the period, down from a first reading of 1.6% growth in April.

On deck for investors is a key inflation reading Friday. The Personal Consumption Expenditures Price Index, which includes the Fed's closely watched "core" PCE measure, will offer potential clues on the path of interest rates less than two weeks ahead of the Fed's next meeting.

Read more: How does the labor market affect inflation?

  • Stocks making the biggest moves after hours

    A slew of corporate results piled in after the market close.

    In tech, investors appeared to press pause on exuberance in the AI trade as shares of Dell Technologies and MongoDB sold off. Dell (DELL) stock, which had rallied more than 120% this year, fell nearly 8% despite better-than-expected results in its infrastructure solutions group, which includes AI servers. MongoDB (MDB) stock dropped more than 20% as the company's revenue guidance of $462 million for the current quarter fell short of analysts' estimates by 2%.

    In retail, Gap (GPS) shares soared more than 20% after the company boosted its full-year outlook for both sales and operating income. Meanwhile, Nordstrom (JWN) stock slipped more than 5% after the company reported an adjusted loss per share of $0.24 for the first quarter, a steeper loss than analysts' estimates for a loss of $0.07 per share.

  • Dow hits lowest level since May 1

    US stocks endured more losses on Thursday as lingering concerns about higher-for-longer interest rates and a Salesforce (CRM) sell-off dampened investors' spirits.

    The Dow Jones Industrial Average (^DJI) sank nearly 0.9%, or more than 350 points, after shedding over 400 to lead Wednesday's stock market slide. The S&P 500 (^GSPC) fell 0.6%, while the tech-heavy Nasdaq Composite (^IXIC) dropped about 1%.

    Salesforce's shares slid nearly 20% after it said sales growth would stall to the slowest in its history, weighing on the Dow, which hit its lowest level since May 1.

  • 1 trend to watch in Friday's PCE print

    At the start of 2024, Capital Economics deputy chief US economist Andrew Hunter flagged to Yahoo Finance in our chartbook that inflation had been pacing at the Fed's 2% target for the final six months of 2023.

    To Hunter, this meant that the Fed needed only see "this current pace of price increases sustained for a few more months."

    That didn't happen. As our chart below shows, sticky inflation readings sent shorter-term inflation trends far off the Fed's 2% goal.

    Economists think that trend will begin to reverse on Friday, with the latest reading of Personal Consumption Expenditures set for release at 8:30 a.m. ET on Friday.

    Economists expect April's "core" PCE, the Fed's preferred gauge that excludes the volatile food and energy categories, clocked in at an annual gain of 2.8%, flat from March's increase. Over the prior month, economists expect core PCE rose 0.2%, down from 0.3% the month prior.

    According to Bank of America US economist Michael Gapen, this would lower the three-month annualized rate of inflation, which hit its highest level in a year during March.

    "We should see a marked improvement in the three-month annualized rate, as the outsized January increase falls out of the sample," Gapen wrote.

    While still far off from the Fed's 2% hopes, this would be a step in the right direction, something that has been hard to say on the inflation front this year.

  • Trending tickers on Thursday

    Salesforce (CRM) led the Yahoo Finance trending tickers page on Thursday as the stock slumped more than 21% after the company released a weaker-than-expected revenue forecast for the current quarter. The stock was headed for its worst single-day drop since 2004.

    UiPath (PATH) shares slid more than 34% after the company cut its revenue guidance for the year and announced CEO Rob Enslin is resigning.

    Kohl's Corporation (KSS) stock tumbled nearly 24% after the company posted a loss per share of $0.24, well below Wall Street's estimates for earnings per share of $0.07. Kohl's also said it now expects full-year net sales to decline in a range of 2% to 4%.

    C3ai (AI) stock rose more than 18% as the company said demand for AI is "intensifying" following its most recent earnings release. C3ai topped Wall Street's estimates for both adjusted earnings per share and revenue. The stock was one of the top gainers in the Russell 2000 Index (^RUT), which rose more than 1% on Thursday, handily outperforming the S&P 500 (^GSPC).

  • More evidence emerges of mortgage rates deterring prospective buyers

    Escalating mortgage rates drove more prospective buyers away from the housing market in April.

    Pending home sales, a forward-looking indicator of home sales based on contract signings, slumped 7.7% in April from the month prior, according to National Association of Realtors data.

    “More potential buyers are pulling away due to high and rising mortgage rates throughout April,” NAR chief economist Lawrence Yun told Yahoo Finance in an email after the release this morning.

    Mortgage rates climbed throughout April and surpassed 7% for the first time since December 2023.

    Regionally, all four US regions posted both month-over-month and year-over-year declines. The Midwest and West had the largest monthly drops, falling 9.5% and 8.5%, respectively.

    Meanwhile, for-sale inventory picked up in April — but as deputy chief economist at First American Odeta Kushi explains it, “You can't buy what you can't afford.”

    While higher mortgage rates sapped buyers’ energy, there weren’t any meaningful contract signing withdrawals this month, per Yun's analysis. Still, pending transactions were down 7.4% year over year.

  • David Zaslav says WBD has 'full buffet' of sports as NBA rights decision looms

    Warner Bros. Discovery (WBD) CEO David Zaslav is leaning on the company's other sports assets as it remains at risk of losing a key media rights deal with the NBA.

    "We continue to talk to the NBA," Zaslav said while speaking at a Bernstein conference on Thursday. "We love our experience with the NBA. But in general, we're a leader in sports ... [with] a full buffet of content around the world."

    The executive touted the company's Olympics coverage win in Europe, along with the recent additions of NHL games, Nascar races, and college football in the US.

    "This is what we do for a living," he said. "We're in the business of sport, and in sport, the deals come up [and] you make a decision about the overall quality of the full menu of content you have for each of your platforms."

    The NBA's current contract with Warner Bros.' TNT Network and Disney's ESPN (DIS) expires at the end of next season, and rumors have swirled in recent weeks that WBD could lose the media rights to its portion of games to Comcast's NBCUniversal (CMCSA). Amazon (AMZN) is also in talks for an exclusive streaming deal through its Prime Video service.

    Wall Street analysts have said that possibility would have lasting consequences for the embattled media giant.

    "Losing NBA rights would be a big negative for WBD," Macquarie analyst Tim Nollen said in a note published earlier this month. "While the cost savings may help earnings, we think sports content is key both for linear TV ad sales and carriage fees, and for the Max streaming service's prospects in a competitive direct-to-consumer landscape, especially as it prepares to join the sports streaming [joint venture] with Disney and Fox."

    Warner Bros. currently shells out a reported $1.2 billion annually for the NBA rights. Disney, the NBA's other major broadcast partner, has agreed to increase its payment of $1.5 billion a year to $2.6 billion in order to renew its deal, according to the Wall Street Journal.

    A separate report from the Sports Business Journal suggests Disney's total pay package is closer to $2.8 billion. Amazon's deal is said to be worth between $1.8 billion and $2 billion.

    Read more here.

  • More AI spending isn't helping everyone in tech

    Salesforce (CRM) stock is down more than 20% after the company's latest earnings release, which revealed that revenue isn't growing at the pace initially hoped.

    Salesforce COO Brian Millham described the buying behavior from customers as "measured" amid "high levels of budget scrutiny."

    Wall Street analysts believe that "budget scrutiny" may be caused by companies spending first on other AI solutions.

    "We are in an environment where the enterprise space needs to invest heavily in AI, and a lot more dollars are going to AI initiatives," CFRA analyst Angelo Zino told Yahoo Finance. "The problem is that this could be coming, at least in the near term, at the expense of Salesforce's increasing revenue trajectory."

    Zino added that companies are all fighting for the same dollars and at this point, AI might be "more of a headwind than a tailwind."

  • New York Fed’s Williams sees inflation easing in second half of year

    Yahoo Finance's Jen Schonberger reports:

    New York Fed president John Williams said Thursday that he expects inflation to start coming down again in the second half of the year and once again reiterated the central bank won't lower rates until it sees further progress on that front.

    "I see some of the recent inflation readings as representing mostly a reversal of the unusually low readings of the second half of last year, rather than a break in the overall downward direction of inflation," Williams said in a speech at the Economic Club of New York.

    "With the economy coming into better balance over time and the disinflation taking place in other economies reducing global inflationary pressures, I expect inflation to resume moderating in the second half of this year," he added.

    Read more here.

  • Dollar General stock sinks as retail theft hits profit, stores move away from self-checkout

    Dollar General (DG) stock fell as much as 4% during the company's earnings call on Thursday as gross quarterly profit was impacted by an increase in shrinkage, an industry term for loss of inventory, including from theft.

    "Shrink continues to be our most significant headwind and was 59 basis points worse in the first quarter compared to prior year, " Dollar General's CFO Kelly Dilts told analysts on the call.

    The company has converted a total of about 12,000 stores away from self-checkout.

    Dollar General's net sales increased 6.1% to $9.9 billion in the first quarter of 2024, compared to $9.3 during the same period last year. Same-store sales rose 2.4% year over year.

  • Costco touches all-time high ahead of quarterly results

    Costco (COST) shares defied downward market trends on Thursday, hitting all-time highs ahead of the wholesale retailer's quarterly results due after the closing bell.

    The stock touched an intraday record of $816.95 during the session.

    As Yahoo Finance's Brooke DiPalma reports, Costco saw foot traffic up year over year, beating the likes of Sam's Club (WMT) and BJ's Wholesale Club (BJ), according to On Thursday afternoon, the company is expected to report net sales of $57.98 billion, up 8.07% year over year, and adjusted earnings of $3.70, up 8%.

    Read more on Wall Street's expectations here.

  • White House: Extending Trump’s tax cuts would be an 'inflation bomb'

    Yahoo Finance's Ben Werschkul reports:

    The White House is releasing a new public memo to allies Thursday that seeks to link the extension of Trump-era tax cuts to inflation, a top-of-mind issue for voters.

    The Republican push to extend and deepen tax cuts enacted in 2017 represents "a MAGAnomics economic agenda that would trigger an 'inflation bomb' and raise costs for middle class families," White House senior deputy press secretary Andrew Bates said in the note being released to reporters and activists.

    The memo was provided first to Yahoo Finance.

    Read more here.

  • Nelson Peltz sells entire Disney stake after proxy battle loss

    Activist investor Nelson Peltz has sold his entire Disney (DIS) stake, according to a source familiar with the matter.

    Peltz sold his position at a price of around $120 a share, which yielded a return of about $1 billion, the source said.

    The development, first reported by CNBC, comes after Disney successfully fended off Peltz in his quest to secure board seats at the company, officially ending a highly contested proxy battle that plagued the entertainment giant for months.

    Peltz had been fighting to secure board seats for himself and former Disney CFO Jay Rasulo but was ultimately unsuccessful. At the company's annual shareholder meeting in early April, Disney said the current board would remain intact following a stockholder vote that gave the company's slate a win "by a substantial margin."

    Disney shares are up about 12% since the start of the year but have fallen roughly 15% since the company defeated Peltz in its proxy fight.

    Read more here.

    Nelson Peltz founding partner of Trian Fund Management LP. speak at the WSJD Live conference in Laguna Beach, California October 25, 2016. REUTERS/Mike Blake
    Nelson Peltz founding partner of Trian Fund Management LP. speak at the WSJD Live conference in Laguna Beach, California October 25, 2016. REUTERS/Mike Blake (REUTERS / Reuters)
  • Dow slides 300 points as Salesforce stock tanks 18%

    The Dow Jones Industrial Average (^DJI) fell about 300 points at the open, weighed down by shares of Salesforce (CRM).

    The blue-chip index fell Thursday after dropping 400 points in the prior session. The S&P 500 (^GSPC) decreased 0.3% while the tech-heavy Nasdaq Composite (^IXIC) also slipped 0.4%.

    Salesforce stock tumbled as much as 18% at the open after the cloud-based software company missed on second quarter guidance, raising concerns over the macro environment and pushing out deal signings.

    Soaring shares of AI chip darling Nvidia (NVDA) haven't been able to lift the overall markets. Growing concerns of higher for longer interest rates amid bumpy inflation reads have put a lid on recent rallies.

    The bond market has struggled as the 10-year Treasury (^TNX) moved back above 4.5%, putting pressure on stocks.

  • GDP: US economy grew slower than initially thought in Q1

    The US economy grew slower than initially thought during the first quarter.

    The Bureau of Economic Analysis's second estimate of first quarter US gross domestic product (GDP) showed the economy grew at an annualized pace of 1.3% during the period, down from a first reading in April of 1.6% growth and in line with economist estimates.

    The update to the first quarter growth metric "primarily reflected a downward revision to consumer spending," per the BEA. Personal consumption in the first quarter grew at 2%, down from a prior reading of 2.5%.

    The reading came in significantly lower than fourth quarter GDP, which was revised up to 3.4%.

    The soft GDP comes at a time when markets have been sensitive to any readings that the economy may be running too hot for the Federal Reserve's liking, as inflation has proved stickier than expected.

    Notably, though, many forecasters don't see the first quarter economic growth slowdown as the start of a broader trend. Goldman Sachs entered Thursday's reading expecting 3.2% annualized growth in the second quarter. Meanwhile, the Atlanta Fed's GDPNow forecaster is currently projecting 3.5% annualized growth in the first quarter.

    Bank of America US economist Michael Gapen wrote in a note to clients last Friday that his team expected a downward revision to first quarter GDP but that it didn't serve as a cause for concern for economic growth moving forward.

    "The bottom line is that the economy moderated somewhat in the first quarter, but it remains on a stable footing overall," Gapen wrote on Friday.

  • Terrible quarter from Best Buy

    Yahoo Finance senior reporter Brooke DiPalma has all the numbers you need on the Best Buy (BBY) quarter here.

    I would just like to add this quarter from Best Buy really stunk, again.

    The sales declines are piling up for the company, making me wonder if there are structural problems that the business can't overcome. Sales pressure has now persisted for two years or so. I am also wondering if there needs to be fresh eyes in the C-suite after this coming holiday shopping season.

    The tough sales quarters for Best Buy continue.
    The tough sales quarters for Best Buy continue. (Best Buy)
  • Follow up: Chewy

    Chewy (CHWY) found its way into these live blog pages on Wednesday, and deservedly so.

    Shares exploded 27% on the back of a better-than-expected quarter (shares are down slightly premarket today). The response caught me a little by surprise, as the company's closely watched active customers metric fell again year over year. In fact, the decline accelerated versus the drop seen in the preceding quarter.

    Nevertheless, the Street ate up the company's margin expansion and commentary on an improving demand environment.

    We caught up with Chewy CEO Sumit Singh in an extensive interview (watch the full interview below), where he echoed that improvement in the demand backdrop.

    I found interesting the company appears all-in on opening vet clinics. It now has four in operation that opened in the first quarter, with another four on the way by year end.

    The company is well behind Mars, which operates thousands of vets (it has been a consolidator in the space, buying family-run practices). But there is a window of opportunity here for Chewy to offer a better care environment that links to the services and products it sells online.

    Also something to watch: The company has begun testing a paid membership program.

  • Trend watch: PC demand cycle

    HP Inc. stock (HPQ) is getting a 3% bump premarket after a better-than-expected quarter last night.

    Out of everything I talked about with HP CEO Enrique Lores (full interview below) following the results, it was his call out of companies upgrading computers ahead of the pulling of support for Windows 10 that left an impression. It appears the race is on to replace computers ahead of that moment in October 2025.

    The introduction of HP's first crop of AI PCs this month is likely further to put gas on that upgrade cycle.

    "We continue to think HPQ remains well positioned to benefit from the PC upcycle, which should only accelerate in the second half and in FY25," Evercore ISI analyst Amit Daryanani wrote in a client note this morning.

  • Salesforce crashing

    Salesforce stock (CRM) is getting hammered premarket to the tune of 16%.

    The sell-off is warranted.

    Salesforce missed on its key performance obligations metric, showing 10% growth versus estimates for 11%. The conference call was littered with concerns about the macro environment, which is pushing out deal signings.

    Second quarter guidance short of consensus reflects these concerns (hopefully for management's sake).

    "Though Q1 has been consistently weaker for software, magnitude of the miss may suggest more idiosyncratic issues (seat-exposure, down-sells, competition) which could continue to weigh on the business in the second quarter, especially with FY25 revenue now looking aggressive (implying second half acceleration vs. 2Q)," Citi analyst Tyler Radke wrote in a client note. "Valuation is undemanding at 20x EPS, 18x enterprise value/free cash flow (on FY25 estimates), but with slowing growth, lack of de-risked estimates and more active M&A we are comfortable on the sidelines awaiting improving growth or more evidence of Data Cloud/GenAI momentum/monetization."

    All in all, a surprising quarter from Salesforce that wasn't telegraphed. The stock is likely to stay in the penalty box until signs of a more stable macro backdrop emerge.