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Nasdaq Hits New Closing High; BOX, CAVA Report Q1

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Tuesday, May 28th, 2024

It’s a tale of two markets once again today. While the blue-chip Dow 30 stayed in the red all session, the small-cap Russell 2000 was looking to break free into the closing bell, but both finished lower on the session. The S&P 500 was technically up but essentially flat, +0.025%, while the Nasdaq crossed over 17K for the first time ever, closing at a new record high. Its 99 points gained today, +0.59%, moves the index to 17,019 as of the close.

It’s easy to see what’s driving this market. With NVIDIA (NVDA - Free Report) advancing another +7% in today’s trading, and joined by other A.I. plays strong on the Data Center side like AMD (AMD - Free Report) , which was up +3% today. There’s no real surprise here: we’ve seen A.I.-related moves driving the bull market going back for more than a year, especially compared with the Dow, which sees most of the A.I. market driving from Microsoft (MSFT - Free Report) . Economic data is also lightening up, along with earnings season, but not quite over.

Consumer Confidence for May improved over expectations today. After three prior down months, this metric moved up to 102.0, from an upwardly revised 97.5 for April. The related Present Situation Index also gained month over month, to 143.1 from 140.6 in April. The Expectations Index also took a step up, to 74.6 from 68.8 previously, but this also marked the fourth-straight month sub-80, which is normally associated with recession-level consumer confidence.

Box Inc. (BOX - Free Report) is up +1% in late trading on its Q1 earnings report. The enterprise-facing cloud solutions provider reported a 3-cent earnings beat to 39 cents per share for the quarter, with $265 million in revenues coming in higher than the Zacks consensus by +3.87%. Next-quarter earnings estimates are slightly higher than previously rendered, though revenues for the quarter are now guided only to the high range of our previous estimate. This markets the fourth earnings beat in the last five quarters.

Shares of CAVA (CAVA - Free Report) are down heavily in after-hours trading today, -7%. The fast-casual Mediterranean grill (think Chipotle with olives and pita) had been riding high, +100% year to date, on big beats for both Q1 earnings and sales this afternoon. The company posted 12 cents per share versus expectations for 3 cents, with revenues totaling $259 million from roughly $246 million anticipated. Same-store sales were also higher than expected — although perhaps not reaching the “whisper number.” Such are the perils of a company doubling its market cap value in five months.

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