Dow drops 200 points as postelection rally sputters, Fed Chair Powell signals caution on rate cuts: Live updates

U.S. stocks slid on Thursday, as fresh comments from Federal Reserve Chair Jerome Powell signaled that economic strength could warrant some patience with future rate cuts.

The Dow Jones Industrial Average slipped 189 points, or 0.4%, after falling more than 250 points at the lows of the session. The S&P 500 ticked down 0.4%, while the Nasdaq Composite pulled back 0.6%.

Stocks took a leg lower after Federal Reserve Chairman Jerome Powell said in Dallas the central bank didn't need to be "in a hurry" to slash rates.

"The strength we are currently seeing in the economy gives us the ability to approach our decisions carefully," Powell said.

Fed funds futures trading reflected a decline in odds for a quarter-point cut at the central bank's December meeting, sliding to about 62% Thursday afternoon from 82.5% earlier in the day.

So-called "Trump Trades" also lost steam as the market rally cooled. Tesla tumbled 5%, while the small-cap benchmark Russell 2000 dropped 1% and underperformed the major averages.

Those moves come after the October producer price index released Thursday rose 0.2%, matching forecasts from economists polled by Dow Jones.

PPI excluding food and energy ran faster than forecast. The October consumer price index came in as expected on Wednesday, but nevertheless signaled the Federal Reserve's fight against inflation is yet to be won. Core CPI rose by 0.3% for a third straight month, with the 12-month rate at 3.3%.

Investors are deliberating whether a postelection rally following Donald Trump's decisive victory last week still has room to run after powering the major averages to new milestones. The Dow closed above 44,000 for the first time on Monday, and both the S&P 500 and Nasdaq Composite notched new highs.

"The fact that we had such an explosive week last week, now [we're] having a little bit of a hangover and a malaise," said Jay Woods, chief global strategist at Freedom Capital Markets. "But we're holding onto most of those gains, so I think this week if anything is constructive."

Rivian, Tesla slide on report that Trump's transition team plans to end Biden's EV tax credit

Shares of Rivian Automotive and Tesla plunged more than 12% and 5%, respectively, on a Reuters report that President-elect Donald Trump's transition team plans to kill the $7,500 consumer tax credit for electric vehicle purchases.

While ending the tax credit could have serious implications for an already slowing U.S. EV transition, Tesla representatives have told a Trump-transition committee they support ending the subsidy, sources told Reuters. Tesla CEO Elon Musk had said earlier this year that ending the subsidy could hurt Tesla sales but devastate its domestic EV competitors, the report said.

Tesla's been a major beneficiary of the postelection stock market rally given CEO Elon Musk's close relationship with Trump. The stock has jumped more than 43% over the past month.

Rivian shares, meanwhile, are up just 0.5% over the past month but down 55% for the year. Thursday's report took back much of Rivian's gains of 13.7% from the previous session, which was driven by a joint press release earlier this week from Rivian Automotive and Volkswagen Group that said the size of their joint venture has increased to up to $5.8 billion.

— Pia Singh

BofA double-downgrades Hims & Hers Health stock, accelerating stock's selloff

The selloff of Hims & Hers Health shares took another notch down after Bank of American double-downgraded shares to underperform from buy.

Analyst Allen Lutz said Amazon's entrance into the hair loss and erectile dysfunction markets will put pressure on the prices Hims & Hers will be able to charge for its competing products. It also could hurt the company's ability to attract new customers, and reduce the value of each new customer it gains.

Lutz cut his price target to $18 from $32. Although Him's shares were recently down more than 25%, Lutz's target implies shares could drop even further.

—Christina Cheddar Berk

'Postelection exuberance' helped speed up record year for ETFs, State Street's Bartolini says

The U.S. ETF industry set its year-to-date inflow record this week, helped by 'postelection exuberance,' according to Matt Bartolini, head of Americas ETF research at State Street Global Advisors

"Heading into the election, ETF flows were already on pace to break records. What happened was the market environment turned and went significantly exuberant. ... All of a sudden, there was a rush of assets into ETFs from a wide range of investors," Bartolini said.

Outside of flows into broad index funds, Bartolini also pointed to the SPDR S&P Regional Banking ETF (KRE) as a fund that has benefitted from the market response to the election. The fund has more than $1.1 billion of net inflows over the past week, according to FactSet.

Bartolini also said that he has Dec. 9 circled as the date for inflows for the U.S. ETF industry to hit $1 trillion this year.

— Jesse Pound

Industrials headed for worst day since September

Industrials stocks as represented by the SPDR Industrials Sector Fund (XLI) are on pace for their worst day going back to Sept. 3rd. The ETF was down by 1.3%.

XLI is on track for a losing week, its third in the past four. The ETF is 2.3% below its all-time high.

Among the biggest laggards in the ETF are Leidos Holdings and Amentum Holdings, falling more than 10%, each. In fact, Leidos is headed toward its worst day going back to May 2023 when it slid 14.5%.

— Sarah Min, Nick Wells

JPMorgan warns ResMed shares could come under pressure before year end

It's been a solid year for ResMed stock so far. Its gains of nearly 35% are slightly outpacing the S&P 500's 33% jump, but JPMorgan analyst David Low warned the stock could come under pressure before the year ends.

"First, we expect Eli Lilly's Zepbound label expansion to be granted by the FDA to include patients with obstructive sleep apnoea (OSA), following the SURMOUNT-OSA trial results," Low wrote in a note to clients. "Secondly, Novo Nordisk will release results from its phase 3 trial for CagriSema, a drug which offers weight loss of over 25%, a greater reduction than is offered by currently approved drugs."

While these events could ding ResMed shares, Low still likes the company's story and rates the stock overweight. The analyst expects obesity drug marketing will boost awareness of the dangers of sleep apnea and encourage more patients to seek treatment. That will stimulate demand for all therapies, including the CPAP machines ResMad sells.

—Christina Cheddar Berk

Fade the postelection rally for freight stocks, Evercore ISI says

The initial rally for freight stocks after President-elect Donald Trump's victory last week may have priced in a near best-case scenario for the group, according to Evercore ISI.

"Although we believe a pull forward demand boost will likely occur in 1H25 and that the downturn is officially over, there will not be another tax catalyst like in 2018, imports aren't nearly as important as industrial manufacturing to freight demand, and the re-rating of much of the group has already occurred, rendering not much more to play for in the equities," analyst Jonathan Chappell said in a note to clients.

Some of the freight stocks that have performed the best since the election are Old Dominion Freight Line, up 9%, and Werner, higher 7%.

"Best case, there is a short-term freight boom that drives estimates higher for 6 months before an inevitable destocking event into a capacity overhang that becomes greater owing to optimism, and worst case the pull forward is a dud. Either way, risk/reward skews negative going forward, and we'd fade most stocks in early 2025," Chappell said.

— Jesse Pound

Aerospace and defense stocks are underperforming

The aerospace and defense sector was struggling Thursday, dragged down by RTX Corp.

The iShares U.S. Aerospace & Defense ETF (ITA) was down more than 3% in afternoon trading and is now below where it closed on Nov. 6, the day after the presidential election.

Among the fund's top holdings, RTX and L3Harris Technologies were two of the worst performers. RTX was down more than 4%, while L3Harris fell 5%.

— Jesse Pound

Trump trade stocks move extend losses on Thursday

Key stocks that are viewed as pillars of the so-called Trump trade pulled back further on Thursday.

Shares of the Trump Media & Technology Group slipped nearly 8%. Stock in the incoming President's social media company have shed nearly 16% this week.

Stock in Tesla, which saw shares soar in the wake of Donald Trump's election victory last week, moved lower by 4%.

One key component of the Trump trade bucked the trend. The dollar index advanced 0.08% and reached its highest level in over a year earlier on Thursday.

— Brian Evans

Stocks making the biggest moves midday

Check out some of the companies making headlines in midday trading:

• Disney — The media stock popped 7% on stronger-than-expected earnings and guidance, aided by growth in its streaming business. The company said it expects high-single-digit adjusted earnings growth in fiscal 2025.
• Capri, Tapestry — Both luxury apparel stocks rose after the companies called off their planned merger, citing regulatory hurdles. Shares of Tapestry jumped nearly 13%, while Capri added 2.5%.
• Hims & Hers Health — The telehealth stock dropped 14% after Amazon revealed Prime users can now access fixed pricing of treatment for conditions such as men's hair loss. The offering puts the company in direct competition with Hims & Hers Health.

Read the full list here.

— Brian Evans

Materials and health care stocks drag on S&P 500 this week

The S&P 500 is on pace to end to week modestly lower, due in part to slides among materials and health care names.

The broad index is tracking to end the week about 0.2% down. By comparison, materials and health care — the two worst-performing of the 11 sectors that comprise the S&P 500 — have each dropped more than 2%.

AbbVie and Moderna dragged the health care sector down with drops of more than 14% and 12%, respectively. Celanese and Newmont led materials lower, posting respective declines of more than 13% and 9%.

— Alex Harring

Oppenheimer raises Nvidia price target

Oppenheimer increased its price target on Nvidia shares ahead of the company's third-quarter earnings announcement on Nov. 20.

Analyst Rick Schafer now has a $175 price target on shares, up from $150 previously. The new price target represents around 16% upside from Wednesday's close. Schafer also reiterated his outperform rating on the stock.

Continued communication services provider and enterprise demand for artificial intelligence accelerators will lead Nvidia to outperform when it announces its third-quarter results — in addition to the current quarter, per Schafer.

"We see NVDA best positioned in AI, benefiting from full-stack AI hardware/software," Schafer wrote in a research note on Wednesday.

— Hakyung Kim

Dollar index reaches 1-year high

The dollar index gained 0.3% Thursday at 106.79, its highest level since Nov. 1, 2023.

The greenback also strengthened 0.2% against the yen at 156.25, the strongest level since July 23.

Since President-elect Donald Trump won the election, the dollar has appreciated 2.8% and 2.1% against the yen and the Chinese yuan. The euro and the pound sterling have both weakened 3.6% and 2.8% against the greenback, respectively.

— Hakyung Kim, Gina Francolla

Stocks open little changed for second straight session

Stocks were little changed shortly after the opening bell on Thursday, with Wall Street still trying to extend a postelection rally.

The S&P 500 ticked up 0.1%, while the Nasdaq Composite 0.1%. The Dow Jones Industrial Average gained 95 points, or 0.2%.

— Brian Evans

Citi initiates buy rating on Gilead

Citi is bullish on Gilead Sciences thanks to its strong HIV treatment business.

The firm initiated coverage on Gilead with a buy rating and a price target of $125 per share, which indicates nearly 35% upside potential from Wednesday's close.

"While shares have outperformed since late May (+56%), we remain bullish based primarily on upside from near term growth in HIV from Biktarvy plus a longer-term contribution from lenacapavir," analyst Geoff Meacham wrote in a note on Wednesday. Biktarvy is the company's prescription HIV/AIDS treatment.

Meanwhile, lenacapavir is slated to launch in the second half of 2025. The drug is intended for HIV prevention, a market which Meacham believes "continues to strong growth."

"We believe the launch of lenacapavir (2H 2025e) could drive meaningful upside over time, especially given the twice-yearly dosing profile in HIV prevention. We acknowledge that the path to broad reimbursement is less certain, however we suspect that payers will ultimately see the value of long-acting drugs in HIV prevention," said Meacham.

— Hakyung Kim

Disney, Cisco among the names making big moves before the bell

Some stocks are making big moves in the premarket:

• Disney – Shares popped more than 9% after the company's fiscal fourth-quarter results beat analysts' estimates. For the period, Disney earned $1.14 per share, after adjustments, on revenue of $22.57 billion. That's above earnings of $1.10 per share on revenue of $22.45 billion that analysts were expecting, according to LSEG.
• Cisco Systems – The networking stock dropped slightly. The company topped Wall Street's quarterly estimates and lifted its full-year guidance, but posted its fourth consecutive quarter of declining revenue.
• Capri, Tapestry – The luxury apparel stocks were moving in opposite directions after the companies called off their planned merger, citing regulatory hurdles. Shares of Tapestry jumped 8%, while Capri slid more than 5%.

Read here for the full list.

— Sean Conlon

Capri, Tapestry shares move after announcing end of merger plans

Capri and Tapestry shares diverged in Thursday premarket trading after the U.S.-based luxury houses terminated their merger agreement.

Versace and Jimmy Choo parent Capri slipped more than 5% before the bell. Coach maker Tapestry, on the other hand, jumped more than 6%.

The two companies mutually agreed to call of the deal after it was blocked by the Federal Trade Commission. Tapestry had previously said it would appeal the ruling in favor of the FTC.

Thursday's premarket action reflects a broader gap in performance between the two stocks. Capri has tumbled around 60% in 2024, while Tapestry has climbed more than 39% this year.

— Alex Harring, Gabrielle Fonrouge

Disney rises slightly after earnings beat

Disney shares were up more than 1% in the premarket after the media giant reported fiscal fourth-quarter numbers that beat analyst expectations.

The company earned an adjusted $1.14 per share on revenue of $22.57 billion. Analysts polled by LSEG anticipated a profit of $1.10 per share on revenue of $22.45 billion.

— Fred Imbert

Jefferies increases Tesla price target

Jefferies hiked its price target on Tesla shares — but is choosing to stick to the sidelines on the electric vehicle maker.

The firm raised its target to $300 from $195 per share. However, this remains 9% below where shares closed on Wednesday. Analyst Philippe Houchois also maintained his hold rating on the stock.

Houchois cited higher earnings and terminal value as reasons for the increased price target.

Tesla shares have rallied in the week following President-elect Donald Trump's victory on Elon Musk's close ties with Trump.

"Musk and Tesla can provide a critical bridge between China and the Trump administration and a moderating influence on Tariffs given Tesla's global market and sourcing exposure," Houchois said in a research note on Thursday.

To be sure, "How much or how long markets ignore potential conflicts of interests ranging from political responsibilities to governance and compensation, is unclear," Houchois added.

— Hakyung Kim

Asia-Pacific markets mostly fall with Hang Seng leading losses

SINGAPORE — Asia-Pacific markets mostly fell on Thursday with Hong Kong's Hang Seng index leading losses in the region, down over 2% as of its final hour of trade.

Mainland China's CSI 300 also tumbled 1.73% to finish at 4,039.62.

The rare bright spot, Australia's S&P/ASX 200 added 0.37% to close at 8,224.

Japan's Nikkei 225 fell 0.48%, reversing earlier gains to close at 38,535.70, while the Topix dropped 0.27% to finish at 2,701.22. In South Korea, Kospi ended nearly flat at 2,418.86, while the Kosdaq Index declined by 1.17% to 681.56.

— Anniek Bao

European stocks open slightly higher

European markets opened moderately higher Thursday.

The pan-European Stoxx 600 was up 0.19% in early deals, with sectors and major bourses diverging. Telecoms stocks led gains, up 0.88%, while household goods ticked 0.48% lower.

The U.K.'s FTSE 100 index was down 0.11% at 8,021, Germany's DAX was 0.42% higher at 19,085, France's CAC was up 0.08% at 7,222 and Italy's FTSE MIB was 0.44% higher at 33,852.

— Karen Gilchrist

Thursday's inflation reading expected to show an uptick

The October producer price index due out Thursday morning is set to show an uptick in inflation.

PPI, a measure of what producers get for goods and services, is expected to show a 0.2% increase last month, according to a Dow Jones consensus estimate. That's up from no change in September.

Excluding volatile food and energy prices, it's set to have increased 0.3%, up from 0.2% previously.

— Sarah Min

Stocks making the biggest moves after hours

Check out the companies making headlines in extended trading.

• CNH Industrial — Shares popped nearly 8% after Greenlight Capital's David Einhorn at CNBC's Delivering Alpha conference told attendees he took a medium-sized position in the agricultural equipment company.
• Cisco Systems — Shares inched lower by less than 1% even after Cisco Systems posted a beat on the top and bottom lines in the fiscal first quarter. The San Jose, California-based tech company reported adjusted earnings of 91 per share on revenue of $13.84 billion. Analysts polled by LSEG forecast earnings of 87 cents per share on revenue of $13.77 billion.

Read the full story here.

— Sarah Min

Stock futures open little changed

U.S. stock futures opened little changed Wednesday night.

Dow Jones Industrial Average futures rose by 14 points, or 0.03%. S&P 500 futures climbed 0.01%, while the Nasdaq 100 futures dipped 0.03%.

— Sarah Min