Stocks were slightly higher as market participants looked ahead towards a busy week of Apple announcements, Federal Reserve policy decisions, and more economic data. The Dow Jones Industrial Average rose nearly 70 points, while the S&P 500 Index and Nasdaq Composite added about 0.3% and 0.35%, respectively.
Here's how the market settled on Monday:
S&P 500 Index (NYSE: SPY): +0.26% or +13.90 points to 5,360.89
Dow Jones Industrial Average (NYSE: DIA): +0.18% or +69.18 points to 38,868.17
Nasdaq Composite Index (NASDAQ: QQQ): +0.35% or +39.40 points to 17,192.53
Apple Intelligence:
Apple (NASDAQ: AAPL) outlined its artificial intelligence plans alongside other updates and announces at its annual Worldwide Developer's Conference keynote on Monday. The tech giant's generative AI models, called Apple Intelligence, will be available across iOS, iPadOS and macOS.
Apple Intelligence has the ability to create generative photos in three styles: Sketch, Illustration, and Animation, introduces system-wide proofreading, prioritize notifications, cross-application tasking, and personal scheduling based on user behavior, among other features. The new updates also include a reimagining of Siri, allowing the voice command tool to use generative AI across applications.
FedWatch:
The Federal Reserve will kick off their two-day policy meeting for June on Tuesday, with more than 99% of analysts expecting interest rates to hold at the range of 5.25% to 5.50% at its conclusion on Wednesday, according to CME Group's FedWatch tool.
Consumer Inflation Expectations were little changed in May, according to a New York Federal Reserve survey released Monday, as outlooks remain above the Federal Open Market Committee's (FOMC) target inflation rate of 2%.
The Survey of Consumer Expectations showed one-year outlook inflation ticking lower to 3.2% last month, down 0.1 percentage point from April. Moreover, the three-year outlook was unchanged at 2.8% and the five-year outlook rose by 0.2 percentage point to 3%.
In the News:
Southwest Airlines (NYSE: LUV) shares were higher Monday after activist hedge fund Elliott Management revealed a $1.9 billion stake in the airline and plans to replace both CEO Bob Jordan and Chairman Gary Kelly with outside candidates in effort to better compete with its rivals.
The airline said in a statement that its board "is confidence in our CEO and management's ability to execute against the company's strategic plan to drive long-term value for all shareholders," while Elliott Management said it will "pursue all available pathways to deliver the leadership changes" the hedge fund believes will elevate the airline.
JPMorgan analyst Christopher Horvers upgraded Walmart (NYSE: WMT) to Overweight from Neutral, projecting that shares of the big-box retailer could rally 23% over the next year and a half to $81, as the firm becomes more defensive given the macroeconomic environment.
"Our desire to add more defensiveness to our ratings given signs of softening discretionary spending while we also stare down a very uncertain back half that includes the presidential election cycle, holiday calendar blues with five fewer days/Christmas on a Wednesday, and an unclear outlook on rate cuts," the firm stated.
GameStop (NYSE: GME) shares continued to decline on Monday after dropping nearly 40% on Friday as the video game retailer's disappointing earnings report fails to bring true momentum to the meme stock. Moreover, Wedbush analyst Michael Pachter said in a note on Friday that GameStop's additional 75 million share sale could aid the struggling company's turnaround plan.
"We cannot see how GameStop adds any value by operating any new business, particularly not now after its entire C-suite was either terminated or chose to depart," Pachter wrote, adding that "with no clear strategy, we suspect the share price will once again begin to descend and approach our new price target."
For Tuesday:
Market participants will continue to access the central bank's next moves when it comes to interest rates ahead of Wednesday's policy decision.