Markets Surge With Renewed Rate Cut Hopes

All three major market indexes have started the month on a strong foot

by Lillian Currens

Published on Aug 1, 2019 at 11:54 AM

The first day of the month has kicked off with the Dow Jones Industrial Average (DJI) up more than 260 points at midday. Stocks sold off yesterday on post-rate cut comments from Fed Chair Jerome Powell, but are bouncing back today on renewed hopes for additional quantitative easing. Soft economic data is boosting traders' dovish hopes, as the Institute for Supply Management's (ISM) manufacturing index fell to its lowest point since August 2016. Likewise, the IHS Markit manufacturing purchasing managers index (PMI) dropped to its lowest level in nearly 10 years last month. Elsewhere, a rally in tech stocks has the Nasdaq Composite (IXIC) up triple digits, and the S&P 500 Index (SPX) is trading higher, too. 

Continue reading for more on today's market, including: 

  • The surprise that sparked this fitness stock's massive sell-off. 
  • 2 reasons to beware this oil stock.
  • Plus, bulls swarm a Buffett-endorsed stock before earnings; SunPower shines on earnings beat; and Pluralsight stock eyes its worst day in years. 

Midday Market Stats August 1

Warren Buffett-backed Kraft Heinz Co (NASDAQ:KHC) is seeing plenty of activity on the options front today. So far, over 14,000 calls have been traded -- four times what's typically seen at this point. In fact, KHC's 30-day at-the-money implied volatility hit a 52-week high earlier, and was last seen trading in the 99th percentile of its annual range. Among the most active is the August 32 call, the buyers of which expect KHC to topple $32 by the close on Friday, Aug. 16. The influx of bullish bets is likely due to Kraft Heinz's upcoming earnings report, set for Aug. 8. At last check KHC was up 2.6% at $32.85. 

One of the biggest gainers so far today is SunPower Corporation (NASDAQ:SPWR). The shares of the alternative energy concern are up 29.5% at $15.14 -- eyeing their best day in years -- after the firm reported a revenue beat and lifted its full-year sales forecast, which prompted a resoundingly bullish response from the brokerage bunch. SPWR stock earlier notched a new three-year high of $16.04.

A second-quarter billings miss and ugly third-quarter guidance have Pluralsight Inc (NASDAQ:PS) falling to the bottom of the Nasdaq. The stock is down 35.9% at $19.66, on course for its biggest one-day drop ever. PS is set to breach its newly formed 200-day moving average, as well as its year-to-date breakeven level. 

PS Chart August 1


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