News of the day for June 21, 2024
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Nvidia (NVDA) stocks fall in premarket trading on the “triple witching” day, when stock options, stock index futures and stock index option contracts expire simultaneously; Gilead Sciences (GUILD) continues to rise after biotech company’s study found drug lenacapavir effective in preventing HIV in women; shares of biotech Sarepta Therapeutics (SRPT) are soaring after US regulators gave their gene therapy for the treatment of a muscle-wasting disease wider approval; shares of fast-casual restaurant chain Chipotle Mexican Grill (CMG) are central ahead of next Wednesday’s 50-for-1 stock split; and CarMax (KMX) shares are rising even as the used car retailer’s quarterly results fell short of Wall Street forecasts. U.S. stock futures are falling after Nvidia’s plunge on Thursday set off a record high for the Nasdaq and S&P 500. Here’s what investors need to know today.
1. Nvidia extends decline as ‘Triple Witching’ looms
Nvidia (NVDA) shares are down 1.5% in premarket trading, continuing Thursday’s declines that knocked the artificial intelligence (AI) chipmaker from its spot as the world’s most valuable company. Microsoft (MSFT) claimed that title Thursday and the shares were little changed in premarket trading. Nvidia, whose shares are up more than 160% this year amid the frenzy for all things AI, will be especially in focus if “triple witching” takes place on Friday. That is the quarterly event where stock options, stock index futures and stock index option contracts expire simultaneously on the same trading day, and this can lead to increased market volatility. Triple witching takes place on the third Friday of March, June, September and December.
2. Gilead continues to rise in HIV drug efficacy
Gilead Sciences (GUILD) extends gains from Thursday, rising 3% in premarket trading after the biotech company announced a Phase 3 trial that showed its injectable lenacapavir was 100% effective in preventing HIV infection in women. Gilead said the results were so successful that an independent data monitoring committee recommended the company end the blinded phase of the study and offer lenacapavir to all participants.
3. Sarepta Rises on Expanded FDA Approval for Elevidys
Shares of biotech Sarepta Therapeutics (SRPT) rose 37% in premarket trading, extending Thursday’s gains, after U.S. regulators approved the Duchenne muscular dystrophy treatment for broader access. The Food and Drug Administration (FDA) authorized Elevidys to be offered to all patients 4 years and older, after previously only allowing it for 4- and 5-year-olds. The disease is “a rare and serious genetic condition that worsens over time, leading to weakness and wasting of the body’s muscles,” according to the FDA.
4. Chipotle in focus ahead of next week’s 50-for-1 stock split
Shares of fast-casual restaurant chain Chipotle Mexican Grill (CMG) are up less than 1% after falling 6.2% on Thursday, the biggest daily percentage loss since last July. The slump comes ahead of a 50-1 stock split that takes effect next Wednesday, an event that will make the company’s stock more accessible to more investors. The stock has risen more than 40% since the beginning of the year and has more than doubled since the beginning of 2023.
5. CarMax wins even if the results are lacking
AutoMax (KMX) shares gained 1.2% in premarket trading, even as the used car seller’s quarterly results fell short of Wall Street forecasts. However, the company announced that it would expand its asset-backed securitization program so that it could increase its financial income. The company reported first-quarter fiscal 2025 net sales of $7.11 billion, down 7.5% from $7.69 billion in the same period last year and below the $7.23 billion expected by analysts consulted by Visible Alpha. Earnings per share (EPS) of $0.97 also came in below the forecast of $0.98. Retail used unit sales fell 3.1% and wholesale units fell 8.3% year-over-year, “impacted by lower seasonal year-over-year appreciation,” CarMax said.
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