Stocks Rise as Investors Digest Latest News on Tariffs, Fed Interest Rate Decision; Disney Surges, Alphabet Plunges

Biggest S&P 500 Movers on Wednesday

May 07, 2025 06:28 PM EDT

Advancers

Charles River Laboratories (CRL) was the best-performing stock in the S&P 500, rising some 19% after the medical testing company announced changes to its board membership and began a strategic review of its operations amid pressure for changes from activist investor Elliott Investment Management.
Shares of The Walt Disney Co. (DIS) surged nearly 11% after its quarterly results came in ahead of analyst estimates and it lifted its full-year profit outlook. The company also highlighted growth in Disney+ subscribers, coming after it projected that its subscriber base would suffer a “modest decline” during the quarter. The media giant also announced plans for a new theme park.

Decliners

Google parent Alphabet (GOOG, GOOGL) was the worst performer in the S&P 500, both classes of shares falling more than 7% on worries over the direction of its search products. An Apple (AAPL) executive reportedly said the iPhone maker is looking to add AI-powered search options to its Safari browser, suggesting that it could eventually replace search engines like Google’s. The executive made the comments during testimony for the Justice Department’s lawsuit against Alphabet, revealing that searches on Apple’s Safari fell last month for the first time, and said that the company has had discussions with Perplexity AI as it looks to add AI search options to its browser. 
International Flavors & Fragrances (IFF) fell 7% after the company reported a decline in year-over-year net sales. DoorDash (DASH) also fell nearly 7%, losing ground for the second straight session after its first-quarter revenue missed analyst estimates. 
Dayforce (DAY) shares dropped by more than 6% after the software company’s quarterly profits and forward-looking projections came in lower than analyst estimates, even as its first-quarter revenue came in better than expected. The human resource software maker reported a 5% increase in its customer base that was below analyst estimates.

-Terry Lane

Supermicro Levels to Watch After Company Slashes Outlook

May 07, 2025 06:18 PM EDT

Super Micro Computer (SMCI) shares fell Wednesday after the embattled server maker sliced its full-year revenue outlook.

While the company, in a late-Tuesday announcement, said it expects delayed client product purchases in its most recent quarter to land in the June and September quarters, it cautioned that economic uncertainty and tariff impacts may have a short-term impact on sales.

Supermicro shares have had a volatile year, more than doubling from their January low to February high before falling nearly 60% from their February  peak to April trough. The shares have lost three-fifths of their value over the past 12 months amid a number of highly publicized accounting and corporate governance challenges that led to concerns of a potential Nasdaq delisting.

Supermicro shares have fluctuated withing an ascending channel since gapping below the respected 50-day moving average in late October last year. In recent weeks, the price has tracked mostly sideways on lackluster trading volume near the pattern’s lower trendline, with the 50-day MA acting as a resistance line.

Moreover, the server maker’s light annual guidance looks set to keep the relative strength index (RSI) below neutral territory, signaling bearish price momentum and a potential breakdown below the ascending channel’s lower trendline.

Investors should monitor major support levels on Supermicro’s chart near $28 and $17, while also watching key resistance levels near $50 and $63.

Read the full technical analysis piece here.

-Timothy Smith

AppLovin Jumps on Earnings, Sale of Mobile Gaming Business

May 07, 2025 06:11 PM EDT

AppLovin (APP) announced the sale of its mobile game business alongside first quarter earnings that topped analysts’ expectations, sending shares soaring in extended trading Wednesday.

The company, whose software helps monetize gaming apps with targeted ads, sold its mobile game segment to privately held Tripledot Studios for $400 million in cash. AppLovin said it will hold a 20% stake in Tripledot following the transaction, which the company expects to close in the second quarter.

AppLovin shares were up 13% in recent after-hours trading. The stock was down 6% for 2025 through Wednesday’s close, but had more than quadrupled in value over the last 12 months.

For the first quarter, AppLovin reported revenue of $1.48 billion, up 40% year-over-year and above the analyst consensus from Visible Alpha. Net income of $576.42 million, or $1.67 per share, compared to $236.18 million, or 67 cents per share, a year earlier, surpassing Wall Street’s estimates.

Looking ahead, the company said it anticipates advertising revenue of $1.2 billion to $1.22 billion in the second quarter, above the $1.11 billion analysts called for.

The results come after a tough start to the year for the adtech company’s stock following allegations of “scammy” practices by short seller Muddy Waters, which on Wednesday said a blog post from AppLovin executives in response to the claims contained “demonstrably false statements.” Muddy Waters’ allegations followed similar reports from two other short-seller firms in February.

-Andrew Kessel

Arm Holdings Plunges in Extended Trading on Weak Outlook

May 07, 2025 05:52 PM EDT

Arm Holdings (ARM) delivered an outlook that came in below analysts’ expectations, sending shares sharply lower in extended trading Wednesday.

The chip designer and Nvidia (NVDA) partner said it anticipates fiscal first-quarter adjusted earnings per share of 30 cents to 38 cents, short of the 41 cents called for by Wall Street, according to Visible Alpha. Arm’s revenue forecast, of $1 billion to $1.1 billion, was also lower than the analyst consensus at the midpoint of its range.

Arm shares were down more than 11% in recent after-hours trading. The stock was up less than 1% so far in 2025 through Wednesday’s close.

In its fiscal fourth quarter, Arm posted record revenue of $1.24 billion, up 34% year-over-year and above the analyst consensus from Visible Alpha. Adjusted net income was $584 million, or 55 cents per share, compared to $376 million, or 36 cents per share, a year earlier, surpassing Wall Street’s estimates.

Arm’s royalty revenue improved 18% to a record $607 million, while its license and other revenue gained 53% to $634 million.

-Andrew Kessel

Charles River Labs Soars as Firm Launches Strategic Review

May 07, 2025 05:19 PM EDT

Charles River Laboratories (CRL) shares soared nearly 19% to lead S&P 500 gainers Wednesday as the medical testing company announced a shakeup of its board and launched a strategic review of its operations after being pressured by activist investor Elliott Investment Management.

Charles River’s board agreed to bring on four new directors, as four current members won’t seek reelection. Following the changes, which will come at the May 20 annual meeting, the company will have 11 directors, nine of whom are independent.

The board also authorized “a comprehensive strategic review and evaluation of Charles River’s business and prospects, including an examination of various alternatives to enhance long-term stockholder value.”

In addition, Charles River said that it has signed a cooperation deal with Elliott, its largest shareholder, in which Elliott “has agreed to customary standstill, voting, confidentiality, and other provisions.”

Partner Marc Steinberg noted that Elliott believes Charles River’s “current value is significantly disconnected from its underlying potential,” and a “substantial opportunity” exists to unlock that value. Steinberg said that these new moves by the company “are the right ones.”

Shares of Charles River Laboratories sank to a more than six-year low last month, and even with today’s gains they remain down more than 25% year-to-date.

-Bill McColl

Marvell Stock Slides After Investor Day Postponed

May 07, 2025 05:09 PM EDT

Shares of Marvell Technology (MRVL) fell 8% to lead Nasdaq decliners Wednesday, a day after the manufacturer of integrated circuits delayed its investor day and narrowed its sales guidance.

Marvell said that because of “the dynamic macroeconomic environment,” it is postponing its previously scheduled investor day from June 10 “to a future date in calendar 2026.”

CEO Matt Murphy called the macroeconomic environment “uncertain,” but said that the company continues “to make great progress in our custom AI silicon business and look forward to sharing updates on the expanded opportunities since our AI Day a year ago.” Murphy added that “this topic” will be central at the company’s annual senior technical leadership conference in Santa Clara, Calif., next month, when it also “will host a webinar focused on the future of custom silicon technology for AI infrastructure.” 

Marvell also affirmed the midpoint of its fiscal 2026 first-quarter revenue guidance of $1.875 billion, but now believes it will be plus or minus 2% versus the earlier outlook of plus or minus 5%.

Marvell Technology shares have lost about half their value in 2025.

-Bill McColl

CrowdStrike Slides as Cybersecurity Firms Plans Job Cuts

May 07, 2025 04:42 PM EDT

CrowdStrike Holdings (CRWD) shares slid Wednesday, a day after the cybersecurity company said in a regulatory filing it plans to cut roughly 500 jobs, or 5% of its workforce.

CrowdStrike “continues to scale its business with focus and discipline” toward a target of $10 billion in ending annual recurring revenue (ARR), it said Tuesday. In March, the company reported ending ARR of $4.24 billion as of Jan. 31.

CrowdStrike expects to incur between $36 million and $53 million in layoff-related charges, including $7 million in its fiscal 2026 first quarter, the filing said. The company plans to report current-quarter results on June 3, with those charges excluded from its adjusted figures.

The company added it sees Q1 results “in-line with or above” its March guidance and affirmed its full-year outlook. 

In a letter to employees, CEO George Kurtz said CrowdStrike is at a “market and technology inflection point, with AI reshaping every industry.”

“AI flattens our hiring curve, and helps us innovate from idea to product faster,” Kurtz added. “It streamlines go-to-market, improves customer outcomes, and drives efficiencies across both the front and back office.”

Shares of CrowdStrike closed nearly 5% lower on Wednesday but are up 23% in 2025. 

-Andrew Kessel

Tesla Sales Woes Continue As China Shipments Decline

May 07, 2025 04:21 PM EDT

Tesla (TSLA) shipped fewer vehicles made in China in April than it did a year ago, following a string of disappointing news for the electric vehicle maker’s sales.

The company delivered 58,459 total Model 3 and Model Y vehicles from its China facility in April, according to preliminary data reported by the China Passenger Car Association.

That’s down 6% from the same time last year, in Tesla’s seventh straight month of year-over-year declines in shipments from China, according to Bloomberg. The shipments figure includes some of Tesla’s exports into Europe as well as sales in China, Reuters reported.

The news comes after several industry groups in a number of European countries issued their own sales and registration data for April. Tesla’s sales and registrations declined in Spain, Germany, and the United Kingdom, among others, even as electric vehicle sales rose overall in the countries.

The EV maker has faced a backlash and been the focus of protests over CEO Elon Musk’s involvement in the Trump administration’s cost-cutting efforts, with shares erasing much of their gains that followed President Donald Trump’s election win.

Shares of Tesla closed slightly higher on Wednesday after declining on Monday and Tuesday. They are down more than 30% since the start of the year.

-Aaron McDade

Fed Says Risks of Inflation, Unemployment Have Risen

May 07, 2025 03:12 PM EDT

As widely expected, the Federal Reserve left the central bank’s key interest rate unchanged Wednesday, staying firmly in “wait and see” mode.

The Fed’s policy committee voted unanimously to keep the fed funds rate at a range of 4.25% to 4.5%, the same as it’s been since December. After cutting interest rates three times late last year, the Fed has held its rate flat to see how President Donald Trump’s policies, especially the tariffs that mostly went into effect in April, will change the economy.

In an official statement released with the policy decision, Fed officials gave little indication of when rate cuts might resume. In recent speeches, policymakers have said tariffs risk pushing up the cost of living and hurting employment, which would be setbacks to both sides of the central bank’s “dual mandate” to keep inflation and unemployment low.

The Fed’s monetary policy playbook calls for lowering rates— which would push down borrowing costs on all kinds of loans and stimulate spending—if the economy slows down severely. However, the remedy for higher inflation would be keeping interest rates higher for longer, potentially putting the Fed between a rock and a hard place if both of those problems worsen.

“The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen,” the FOMC said in an official statement.

In recent years, the Fed has kept its interest rate at a higher-than-normal level to counteract the post-pandemic inflation surge. The high fed funds rate has pushed up borrowing costs on credit cards, car loans, and other debt to balance demand and push inflation toward the Fed’s 2% annual goal.

The Fed is facing political pressure to take action from President Donald Trump, who has frequently demanded that central bankers lower interest rates. The Fed is not under direct control of the White House and is supposed to be independent to stay above the political fray.

Economic data could force the Fed’s hand before too much longer. Many economists expect the tariffs to take their toll on the job market in the next few months. Business leaders have said in surveys that they are cutting back on hiring and investment because of the added costs of tariffs and the uncertainty about whether or not they’ll be lifted.

-Diccon Hyatt

What Betting Markets Say About Who the Next Pope Will Be

May 07, 2025 01:49 PM EDT

The Vatican is picking a new pope. You can bet on who will get the job. 

You (probably) weren’t invited to don a red robe, head to the Sistine Chapel and weigh in on the relative merits of some of today’s most prominent spiritual leaders. But your instinct still counts at Polymarket and Kalshi, online prediction markets where people can wager on all kinds of things—including the identity of the next pope.

Pope Francis died last month, and dozens of cardinals met Wednesday to begin voting on a new leader for the Vatican. It may take multiple rounds of voting over a number of days for cardinals to reach the two-thirds majority needed to name a new leader of the Catholic Church.

The top contenders are said to include Cardinal Pietro Parolin, an Italian who was second-in-command under Francis, and Luis Antonio Tagle from the Philippines, according to the New York Times.

Nearly $29 million has collectively been wagered on the matter at Polymarket and Kalshi as of early Wednesday afternoon. On Polymarket, if you accurately bet $1 that Parolin will win, you would get a $3.13 payout; a successful $1 wager on Tagle would bring in $5.21, as of early Wednesday afternoon.

Payouts appear similar on Kalshi. A winning $1 bet on Parolin would result in a $3.72 payout; a $1 wager on Tagle would lead to a $5 reward.

-Sarina Trangle

Alphabet Plunges as Apple Weighs Adding AI Search in Browser

May 07, 2025 12:57 PM EDT

Shares of Google parent Alphabet (GOOGL) plunged Wednesday after an Apple (AAPL) executive reportedly said the iPhone maker is looking to add AI-powered search options to its Safari browser, and suggested they could eventually replace standard search engines like Google’s.

Shares of Alphabet were down 9% in recent trading. They’ve now lost more than a fifth of their value since the start of the year. 

Apple’s senior vice president of services, Eddy Cue, said Wednesday during testimony in the U.S. Department of Justice’s lawsuit against Alphabet that searches on Apple’s Safari fell last month for the first time, and attributed the drop to rising AI use,  Bloomberg reported.

Cue said Apple is in discussions with Perplexity AI as it looks to add AI search options to its Safari browser, with expectations their use could overtake standard search engines like Google’s, the report said.

-Kara Greenberg

Some Analysts Concerned About AMD’s AI Revenue

May 07, 2025 11:56 AM EDT

Even as Advanced Micro Devices (AMD) reported first-quarter results that beat Wall Street’s expectations, some analysts are expressing concerns that tightening export restrictions to China could harm AI revenue going forward.

Jefferies cut its price target to $100 from $120, while maintaining a “hold” rating for the stock. “AI growth is the primary metric for the stock and on that front estimates move lower,” the analysts said.

On the company’s earnings call, CFO Jean Hu said AMD would take a $1.5 billion revenue hit in 2025 related to limits on sales of its chips to China. Overall, AMD projected second-quarter revenue of $7.1 billion to $7.7 billion. Analysts had called for $7.3 billion.

Citi analysts maintained a $100 target, noting that while AMD’s AI revenue is expected to fall in the first half of the year, “almost every other company has its AI business increasing.”

Meanwhile, Wedbush moved higher to $120 from $115 and UBS moved to $155 from $150.

 Wedbush pointed to the success of AMD’s compute and gaming segments, which “significantly outperformed” in the quarter.

AMD shares were up nearly 1% at $99.50 in recent trading.

-Andrew Kessel

Supermicro After Server Maker Reduces Revenue Outlook

May 07, 2025 11:07 AM EDT

Super Micro Computer (SMCI) shares sank in early trading Wednesday, a day after the server maker and Nvidia (NVDA) partner reduced its sales outlook, as some customers delayed making product decisions amid economic uncertainty.

The company said in its fiscal third-quarter report Tuesday that it now expects full-year revenue of $21.8 billion to $22.6 billion, down from its prior range of $23.5 billion to $25.0 billion.

For its fiscal fourth quarter, Supermicro anticipates sales of $5.6 billion to $6.4 billion and adjusted earnings per share of 40 cents to 50 cents, both well below Visible Alpha expectations. CEO Charles Liang said some customers were delaying commitments amid “economic uncertainty and tariff impacts.” 

JPMorgan analysts kept their “neutral” rating on the stock but trimmed their price target to $35 from $36. They said they had expected “a sharper rebound in earnings through both revenue and margins,” adding that Supermicro continues to face “lower cost inventory related headwinds.”

Citi analysts cut their price target on the stock to $37 from $39 but also maintained a “neutral” rating. Supermicro’s “below consensus outlook” for the fourth quarter “implies the pushouts in revenues resulting from customers awaiting next generation GPUs will take more than a quarter to resolve, further exacerbating investor concerns on competitive dynamics, GPU allocation, visibility and AI lumpiness,” the analysts wrote. 

Super Micro Computer shares were down more than 5% at around $31 in recent trading. The stock entered Wednesday up 8% so far this year. 

-Nisha Gopalan

Watch These AMD Levels as Stock Rises After Earnings Beat

May 07, 2025 09:59 AM EDT

Advanced Micro Devices (AMD) shares rose in early trading Wednesday after the chipmaker posted first-quarter earnings that surpassed Wall Street expectations.

Sales in the company’s data center segment surged 57% in the quarter, helping to allay concerns of a slowdown in AI spending amid uncertainty about what impact the Trump administration’s tariffs will have on global growth. However, the chipmaker cautioned that its results would be affected by charges of roughly $800 million related to tightening export restrictions on sales of its chips to China.

Through Tuesday’s close, AMD shares had gained 18% since the start of the year and risen nearly 30% from their April low, far outpacing the performance of the S&P 500 over those periods.

AMD shares have trended lower within a descending channel since October last year, tagging the pattern’s upper and lower trendlines on multiple occasions since that time. More recently, the stock had rallied toward the channel’s upper trendline and 50-day moving average, two indicators that provided significant resistance on the chart in late March.

Meanwhile, the relative strength index (RSI) has recently crossed back above the 50 threshold ahead of the chipmaker’s earnings report to signal improving price momentum.

Investors should watch major support levels on AMD’s chart around $93 and $78, while also monitoring crucial resistance levels near $116 and $132.

AMD shares were up 1% at around $100 in recent trading.

Read the full technical analysis piece here.

-Timothy Smith

Disney Jumps After Strong Earnings, UAE Park News

May 07, 2025 09:02 AM EDT

Shares of The Walt Disney Company (DIS) rose in premarket trading Wednesday after the media and entertainment giant’s fiscal second-quarter results came in better than analysts had expected.

Disney reported adjusted earnings per share (EPS) of $1.45 on revenue of $23.62 billion. Analysts had expected $1.20 and $23.17 billion, respectively, per Visible Alpha.

“Following an excellent first half of the fiscal year, we have a lot more to look forward to, including our upcoming theatrical slate, the launch of ESPN’s new DTC offering, and an unprecedented number of expansion projects underway in our Experiences segment,” CEO Bob Iger said. “Overall, we remain optimistic about the direction of the company and our outlook for the remainder of the fiscal year.”

Separately on Wednesday, Disney announced a partnership with Abu Dhabi-based developer Miral to build its seventh theme park on Yas Island in the capital of the United Arab Emirates. The companies said that Disney will lead the creative efforts, while the resort will be built and operated by Miral

Disney lifted its adjusted EPS outlook for the fiscal year to $5.75, which would represent a 16% increase from fiscal 2024. Last quarter, it said it expected adjusted EPS to grow by a high-single-digit percentage.

The company said it will “continue to monitor macroeconomic developments for potential impacts to our businesses and recognize that uncertainty remains regarding the operating environment for the balance of the fiscal year.”

Disney shares were up 8% in recent premarket trading. They entered the day down roughly 17% since the start of the year.

-Aaron McDade

Major Index Futures Point to Higher Open

May 07, 2025 08:18 AM EDT

Futures tied to the Dow Jones Industrial Average were up 0.7%.

S&P 500 futures were up 0.6%.

Nasdaq 100 futures also rose 0.6%.