Reddit Stocks: What meme stocks are trending today? – September 28, 2023

US futures

• Dow Jones Industrial Average is up 0.6%
• S&P 500 is up 0.7%
• Nasdaq 100 is 1%

US futures are pushing higher today as treasury yields pullback from recent highs, providing some momentum for growth stocks, while the latest inflation data didn’t bring any unwelcome surprises.

Markets will be glad to see September draw to a close considering the S&P 500 and Nasdaq 100 both suffered their sharpest monthly fall of 2023, which also capped-off the worst quarter for all three major US indices in a year.

US inflation

The Personal Consumption Expenditures (PCE) Price Index rose 0.4% in August from the previous month and was up 3.5% from the year before. The monthly figure came in just below the 0.5% forecast, although the annualised figure suggests it was close.

Core PCE, which is more closely-watched and excludes the more volatile components like food and energy, was up 0.1% month-on-month and 3.9% from last year. That compared to forecasts for a 0.2% monthly rise and a 3.9% annual increase.

That was the slowest monthly increase seen since late 2020. That should reinforce hopes that the Fed will leave interest rates alone at the next meeting, although another hike is still on the cards before the end of 2023.

Economic calendar

The economic calendar for the remainder of today sees the Chicago PMI and Michigan consumer sentiment out this morning, followed by a speech from the Federal Reserve’s New York president John Williams.

Markets are also watching for any news from the political sphere as the threat of a US government shutdown rises and the clock ticks down. Both the Senate and the House are voting on bills in the hope of averting a shutdown.

Most discussed Reddit stocks

Below is a list of the top 10 most mentioned US stocks on the WallStreetBets thread on Reddit over the last 24 hours, according to data from Quiver Quantitative. Exchange-Traded Funds (ETFs) and other instruments have been excluded:

1. NVIDIA
2. Tesla
3. AMD
4. C3.ai
5. Nike
6. Apple
7. Amazon
8. Rivian
9. Meta
10. Visa

Most active US stocks before the bell

Below are the most active stocks with a valuation of at least $500 million before the bell, based on trading data taken from Bloomberg:

1. Nikola
2. MSP Recovery
3. Palantir
4. Tesla
5. Carnival
6. Nike
7. OPKO Health
8. Marathon Digital
9. Ginkgo Bioworks
10. Lucid Group

US premarket winners and losers

Here are the stocks worth at least $500 million experiencing the sharpest movements in premarket trade, according to data from Bloomberg:

Top US stocks to watch

Let’s have a look at the top stocks to watch today.

Nike rises on hopes of improved profitability

Nike shares are up almost 10% today after profits came in higher than expected in the first quarter after the athleisure giant shifted more inventory than expected, which should help boost profitability going forward.

Inventories were down 10% in the first quarter, which was a greater drawdown than the 9% forecast by analysts. That allowed its gross margin to come in slightly better than anticipated, which won shareholders over despite revenue growing slightly slower than hoped at 2% to $12.9 billion. Interestingly, wholesale revenue remained more stable than expected, but its direct-to-consumer arm that has been driving growth saw a much slower expansion in sales than hoped.

EPS also grew 1% to $0.94, when Wall Street had expected a sharp decline. Lower inventories should lead to further improvements in profitability, with Nike forecasting mild growth in both sales and margins in the second quarter. Nike is aiming to deliver mid-single digit revenue growth over the full year.

Wall Street embraced the update. Morgan Stanley said it may be behind the worst of its troubles and Piper Sandler said the reiteration of its full year guidance was welcome considering there were some fears it could cut it amid a tougher outlook for consumer spending. Still, there were some concerns about North America sales and a cooldown in China.

The update is feeding through to other apparel stocks like Under Armour and Dick’s Sporting Goods, which are up 2.9% and 3.2%, respectively.

Will Detroit’s Big Three automakers face more strikes?

Ford, General Motors and Stellantis are up 0.4% to 1% despite the threat that strike action being undertaken by the United Auto Workers could be expanded and disrupt more of their operations.

UAW president Shawn Fain is expected to make a video address to members this morning, which could see him announce plans to shutdown more factories in absence of a deal. That is eroding hopes that the two sides were getting closer amid reports that the union had lowered its demands for pay rises.

Only around 12% of the union is currently on strike, leaving scope for far more disruption. New walkouts could start at noon today, reports suggest. The UAW expanded strike action against GM and Stellantis last week after little progress was made in negotiations, although Ford was spared.

China risks keep building for Apple

Apple shares are up 0.9% this morning. The stock briefly slumped to its lowest level in almost five months yesterday before recovering as buyers were drawn back into the market.

Apple staff have met Chinese officials in recent months to talk about new rules designed to restrict the availability of apps made by Apple and other foreign tech companies, according to the Wall Street Journal. Apple has been told that it must strictly enforce new rules to ban unregistered foreign apps, in an effort to stop a loophole that allow iPhone users to download banned apps like Instagram, YouTube or X.

That will be adding to existing concerns about China, with fears of a ban on foreign tech for government workers and increased competition from domestic players like Huawei already bubbling. The new app rules pose a new threat to Apple’s fast-growing services business, on top of existing ones on hardware.

Does Amazon offer “compelling” entry point?

Amazon shares are up 1.5%. The stock was also among megacaps that briefly hit new lows after hitting levels not seen in over three months before squeezing out a small gain by the end of play.

The stock has slumped about 13% from the peaks we saw earlier this month, which Evercore ISI analyst Mark Mahaney said provides a “compelling” entry point for long-term investors yesterday. That was part of a note focused on the threats stemming from China as domestic rivals like Temu and Shein gain momentum, which Mahaney said represents a “competitive risk”, but one that has been “very overstated”.

Meta hits 2-week high on AI catalysts

Meta shares are up 1.4% and set to open at a two-week high after the social media giant installed confidence it is a major player in breakthrough technologies like AI, virtual reality and wearable tech at its annual Connect conference this week.

The company unveiled new generative AI assistants, an updated version of its virtual reality headset and new smart glasses. Notably, its AI assistants are learning using information taken from Bing, the search engine trying to be revived with AI tools by Microsoft. The head of Meta’s global affairs, former UK politician Nick Clegg, told Reuters yesterday that its AI and large language models are also being trained on public Facebook and Instagram posts, showing it is putting its access to rich data to use.

The new smart glasses, designed by Ray-Ban, will be priced at $299 and hit the shelves in October and will include a new AI assistant. The glasses can be used to livestream broadcasts and take photos that can land directly on to Facebook and Instagram.

The new Quest headset will also start shipping next month, boasting its first generative AI products capable of generating text and images. Meta currently has over a 90% share of the global mixed-reality headset market and is now working to unleash more services and content on its users.

NVIDIA: French offices raided

NVIDIA shares are up 2.5% and on course to gain ground for a third consecutive session. The stock is currently following the 100-day moving average higher, with the metric having provided reliable support for six straight sessions, but the share price is now diverging and pushing higher and away from the moving average.

The chipmaker’s offices in France were raided by the country’s competition authority this week, the Wall Street Journal reported, concerning suspicions that it engaged in anti-competitive practices. Authorities disclosed the raid yesterday but did not provide details beyond outlining it was focused on the graphics card industry and followed on from a broader investigation into cloud computing. French officials are looking into whether larger companies are preventing smaller players from entering the market by using their large cloud computing services.

AMD stock hits 2-week high

Advanced Micro Devices is up 1.7% at $104.53 and building on the momentum seen yesterday, when the chipmaker booked its strongest daily gain in almost four months. The stock is set to open above the 20-day moving average today.

Qualcomm’s acquisition of Autotalks being probed

Qualcomm shares are up 0.8% after the UK Competition & Markets Authority announced it will investigate its proposed acquisition of Israeli outfit Autotalks amid concerns it could lessen competition in the chipmaking market in the country.

The deal was announced in May but details have not been disclosed. Autotalks makes chips that are used to manage crash-prevention technology in vehicles. Qualcomm has been making a deliberate push into the automotive market as cars become smarter and more high-tech.

EU regulators have said Qualcomm will need antitrust approval and reports have suggested the US Federal Trade Commission is minded to open an in-depth investigation into the deal.

Fears grow that Tesla deliveries will fall short

Tesla shares are up 3.3% and at a one-week high as markets prepare for the electric carmaker to release production and delivery numbers, with several analyst warning sales could come in below expectations due to downtime at several factories and the introduction of new models to the production line.

Tesla is forecast to deliver 457,795 vehicles in the third quarter, according to the latest consensus numbers from Bloomberg. That has dropped sharply from over 460,000 earlier this week. Some brokers remain pessimistic. Barclays, Baird and Guggenheim are among those anticipating a miss, with estimates ranging between 439,000 to 455,000. If the average consensus is met, then deliveries would be down from the previous quarter and make a dent in Tesla’s momentum.

Analysts said any miss could be down to downtime and upgrades at its factories, and because it has had to shift resources to its new Model 3 and the Cybertruck. Still, the fear will be that markets will see any miss as a sign demand is weakening, which could stoke concerns that more price cuts will be needed to shift its cars.

As usual, Tesla has not confirmed when the report will come out but it could publish delivery figures as soon as this weekend. Quarterly results come out in mid-October.

Can Rivian impress with deliveries?

Smaller electric vehicle maker Rivian, which is up 1.3% today, is also expected to report quarterly delivery figures in the near future and Wall Street is hopeful it could impress. The stock is set to storm higher for a fifth consecutive session today and is at a two-week high, with the share price testing the 50-day moving average this morning.

Rivian is forecast to deliver 14,973 vehicles in the third quarter, which would be more than double what it sold the year before and over 18% higher than what we saw in the previous quarter. It would also mark a new quarterly record! Baird named it as its “bullish fresh pick” this week on the belief it could beat forecasts, slapping an Overweight rating and a $30 price target on the stock.

Klaviyo shines among IPO stocks

Klaviyo shares are pushing higher again today and set to rise for a fifth consecutive session, with the email marketing specialist poised to set a new opening-high today of $37.25 and install hope following a mixed revival in the IPO market.

The company listed at $30 per share and has managed to stay above this price since going public, but it has only started to find some momentum this week. Still, the price remains below the $39.50 high we saw on the first day of trading.

Unfortunately, the other big-name members of the stock exchange have not performed as well. British semiconductor designer Arm is up today at $56.13 but has still booked minor gains since listing at $51 earlier this month, while Instacart is recovering and at $30.20 this morning, just above its $30 IPO price after slipping below this level over the past two sessions.

Can Carnival keep sailing ahead?

Carnival is up 3.1% ahead of third-quarter results due out this morning. Carnival has been one of the best performers in the S&P 500 this year as the travel industry continues to roar back to life. While consumers are having to cope with a cost-of-living crisis, holidays and travel remain a high priority for people after years of being locked away during lockdown. However, shares have recently lost momentum and Carnival needs to provide a catalyst to reinject some much-needed momentum.

The cruise liner is set to report its fourth year of losses this year, but sales are set to hit an all-time high and losses are set to be almost negligible, setting it up for a big recovery in 2024 so long as the travel industry remains resilient.

Quarterly revenue is expected to be up 57% from the year before at $6.75 billion as more people book trips at higher prices and occupancy rates keep improving. Adjusted Ebitda – its headline measure – is expected to come in at $2.11 billion, marking a seven fold increase from the year before. Markets may get excited considering analysts predict it will report adjusted earnings of $0.76 per share – which would be its first quarterly profit in three-and-a-half years! However, be wary as analysts see it slipping back into the red for the next three quarters and don’t see it sustaining a move back into the black for some time. With that in mind, liquidity remains strong and it has the resources it needs to make its comeback.

Can Bitcoin hold above $27,000?

Bitcoin climbed back above the $27,000 threshold yesterday for the first time in a week, helping lift cryptocurrency stocks like Marathon Digital and Riot Platforms. However, Bitcoin has come up against fresh resistance and has slipped just below that level today, currently trading at $26,994, showing the rally yesterday is fragile.

Palantir hits September-highs

Palantir shares are up 1.9% and on course to gain ground for a third consecutive session, driven higher after it won a new $250 million government contract earlier this week. The fact the contract involves AI is providing further excitement.

IonQ rises on quantum computing contract

IonQ, one of the smaller stocks to have rallied this year thanks to the eruption of interest in AI, is up 1.8% before the bell after announcing it won a $25.5 million deal with the Air Force Research Lab that will see it deploy new quantum computing systems to help research and development.

IonQ has been working with the lab for a year and the contract builds on the existing work. The new systems will be deployed in New York.

Is GameStop “doomed”?

GameStop shares are up 1.1% today. The video game retailer and meme stock favourite initially rallied yesterday after announcing it appointed Ryan Cohen, its chairman and major financial backer, as CEO to give him further control over the struggling business and build pressure on him to turn things around.

GameStop shares initially popped on the news as retail traders welcomed the news, but it gave back all those gains and more by the end of the day and suffered its biggest daily fall in over a month after Wedbush analyst Michael Pachter said the appointment reinforces his view that “GameStop is doomed”.

“With no path to a turnaround and the inevitable migration of physical software sales to digital downloads, we think Mr Cohen’s appointment ensures GameStop’s demise,” he said. “We remain convinced that GameStop is doomed, as declining physical software sales and a shift of sales to subscriptions and digital downloads seal its fate”.

Blue Apron jumps on takeover by Wonder Group

Meal-kit company Blue Apron is up 134% today at $12.85 after announcing it has agreed to be taken over by Wonder Group for about $103 million, giving the company a valuation of around $13 per share. That is more than double the share price at the end of play yesterday.

Blue Apron shares had fallen 40% since the start of 2023 before the takeover was announced.