Dow closes 200 points higher Monday to snap 3-day losing streak: Live updates

U.S. stocks closed higher Monday.

The Dow Jones Industrial Average traded 209.52 points higher, or 0.62%. The S&P 500 and the Nasdaq Composite rose 0.24% and 0.18%, respectively.

— Hakyung Kim

Jefferies upgraded its target price on electric vehicle giant Tesla on Monday, with analyst Philippe Houchois' forecast implying about 3% downside from Friday's $274.43 close.

"We value Tesla first as a superior-ROIC [return on investment capital], software-enhanced, manufacturer but recent developments also suggest a shift in valuation drivers, with Tesla's early focus on AI-based autonomy standing out, notably in terms of scalability," Houchois said.

Tesla stock is down about 2% in Monday trading.

— Brian Evans

Equities could see some volatility later this year as they reach high valuations, according to Andrew Patterson, senior economist at Vanguard.

"We believe that the equity market is towards the higher end of our range of fair value estimates of valuations. So equity markets [are] certainly a little bit stretched," said Patterson.

He added that "the fixed income market, on the other hand, [has] been inverted for over a year now at this point, so it's been calling for a recession for some time."

Keeping in mind other factors such as the Federal Reserve's policies, Patterson said that he still anticipates a downturn as the central bank tries to hit its 2% inflation target.

"If so much as markets are not pricing that [these factors]. ... There could be a bit of volatility," Patterson continued.

— Hakyung Kim

JPMorgan isn't subscribing to the view that without technology and artificial intelligence, the market is cautious and pricing in a potential adverse scenario.

"The market ex Tech/AI is far from priced for disappointment," JPMorgan strategist Mislav Matejka said in a note Monday.

The 12-month forward price-to-earning multiple for the S&P 500, excluding tech and AI, is at 17.4x, compared to the low in October, when it was at 14.5x, he wrote.

"FOMO is in full swing, there is complacency being built into stocks with VIX at the lows of its range," Matejka said. "All this suggests that, if the activity momentum does weaken in 2H, relative to the current projections of no/soft landing, stocks are unlikely to shrug it off, or look through, as they are not priced for disappointment anymore, even if one is to fully take out the Tech/AI/FAANG groups from
the equation."

— Michelle Fox

Industrials led the S&P 500's sector gains on Monday.

The Industrial Select Sector SPDR Fund rose 1.2%. Paycom Software, Quanta Services and Stanley Black & Decker all rallied by more than 3%.

The health care sector was the second-biggest gained, with the Health Care Select Sector SPDR Fund posting an 0.8% increase.

— Hakyung Kim

Merger and acquisition activity will eventually accelerate on Wall Street, partly spurred by pent-up demand from companies with investment-grade balance sheets looking to buy assets from those with more leveraged capital positions, Alan Schwartz, executive chairman of Guggenheim Partners said on CNBC's "Squawk on the Street."

Strong companies will have "a lot of M&A opportunities," while the looming challenge for those that are more stretched is, "Can borrowers refinance at higher rates?" 

Looking at future investment themes, Schwartz stressed the global economy's attempt to decarbonize and wean itself off fossil fuels, resulting in enormous amounts of capital that will pour into renewable energy producers and companies emphasizing carbon capture, advanced nuclear and hydrogen-powered technologies.

Schwartz figures the Federal Reserve will raise rates at its next meeting on July 26, "But I don't think we're going to then turn around and have an easing" anytime soon. "We still think a recession is on the horizon, probably later this year or maybe in 2024."

— Scott Schnipper

There are now two music focused ETFs on the market, trying to capture some of the excitement around the sector shown in the private market.

The MUSQ Global Music Industry ETF (MUSQ) was little changed in its first full day of trading on Monday. The fund's top holdings include Amazon, Apple, Alphabet and Sony, and it has net expenses of 0.78%.

The new fund comes about two weeks after the launch of Clouty's TUNE ETF, which has a lower expense ratio but also a few holdings with no obvious connection to the music industry other than stock price correlation. The TUNE ETF has seen tepid trading so far.

— Jesse Pound

Strategists at Citi downgraded U.S. equities after a strong first half of 2023, saying an economic slowdown will weigh on company earnings.

The Wall Street firm slashed the rating to neutral from overweight Monday and said the S&P 500 will pull back 9% to end the year at 4,000. The equity benchmark closed Friday's session at 4,398.95.

"After a solid 1H, US outperformance may go on pause," Citi strategists said in a note. "Our US Strategy team thinks megacap Growth is set for a pullback, while US recession risks could still bite."

— Yun Li

As the economic activity in developed and large economies is expected to decelerate through the rest of 2023, emerging market equities have the potential to outperform their developed peers, according to Glovista Investments.

"Exceedingly cheap relative valuations between EM equities and developed peers has lend[ed] attractive entry points for global investors at a cyclical juncture in which the Fed is widely expected to bring its rate hike cycle to an end," wrote Carlos Asilis, chief investment officer, as well as deputy chief investment officer Darshan Bhatt.

Asilis and Bhatt added that global investors are "exceedingly underinvested" in emerging market equities.

There is "considerable potential for an impending start to policy rate cuts by many EM central banks, as prevailing real interest rate levels are high by historical standards and running inflation momentum has been turning lower over the past several months," the investment strategists added.

— Hakyung Kim

Check out some of the companies making headlines in midday trading.

Carvana — Shares soared 10% in midday trading. The company said on Monday it expected exponential growth within its used electric vehicle segment as consumer demand for EVs skyrocket.

Lucid — The luxury electric vehicle company added 3.4%. Lucid has gained more than 15% since January, and has added roughly 34% since hitting its 52-week low on June 23.

Shockwave Medical – Shares of the medical device maker jumped 5.8% following an upgrade to overweight by Morgan Stanley. The Wall Street said said consensus expectations are misjudging potential catalysts that could improve the sales outlook for its key product.

Read the full list here.

— Brian Evans

Bank of America analyst Justin Post reiterated a buy rating on Amazon ahead of the start of its Prime Day, which opens July 11 and goes through July 12. Bank of America expects the shopping event will likely be stronger than it was the year prior, driving meaningful sales for Amazon and helping it continue to take online retail market share.

"We project 10% 2Q and 10% 3Q [gross merchandise value] growth for Amazon (as 3Q is comping Prime Day last year), and note Amazon is likely still taking share within Online Retail (we estimate industry is growing in mid-single digit range)," Post wrote in a note Sunday.

Amazon shares were last down 2% Monday. They're higher by more than 50% this year.

— Sarah Min

Meta Platforms shares rose on Monday to trade near levels last seen in February 2022. A slew of consumer discretionary stocks also notched new highs, including Norwegian Cruise Line, last trading near levels not seen since April 2022.

Here are some of the other companies hitting fresh 52-week highs:

• Lowe's trading at levels not seen since March 2022
• Marriott International trading at levels not seen since April 2022
• Ralph Lauren trading at levels not seen since March 2022
• Baker Hughes trading at levels not seen since June 2022
• Fiserv trading at levels not seen since April 2021
• FleetCor Technologies trading at levels not seen since April 2022
• DaVita Inc. trading at levels not seen since May 2022
• American Airlines Group trading at levels not seen since May 2022
• Alaska Air Group trading at levels not seen since April 2022
• Carrier Global trading at levels not seen since January 2022
• Rockwell Automation trading at levels not seen since January 2022
• Verisk Analytics trading at levels not seen since December 2021
• Westinghouse Air Brake Tech trading at levels not seen since September 2018
• NXP Semiconductor trading at levels not seen since February 2022
• TE Connectivity trading at levels not seen since March 2022

These stocks hit fresh all-time highs:

• Howmet Aerospace trading at all-time highs back to its Alcoa spinoff in November 2016
• Ingersoll-Rand trading at all-time high levels back through our history to 1972
• Quanta Services trading at all-time highs back to its IPO in February 1998
• Fortinet trading at all-time highs back to its IPO in November 2009

These names hit fresh lows:

• Bristol-Myers Squibb trading at lows not seen since January 2022
• Humana trading at lows not seen since June 2022
• Amcor trading at lows not seen since June 2020
• FMC Corp trading at lows not seen since November 2021

— Chris Hayes, Samantha Subin

Stifel's Barry Bannister reiterated his year-end S&P 500 target of 4,400 — meaning the strategist expects the benchmark to stay rangebound for the rest of 2023.

"Our unchanged view is that the S&P 500 is leveling out ~4,400 in 2H23E as rising real yields pressure Growth stocks," wrote Bannister, the firm's chief equity strategist in a Sunday note. "Although 2H23 is conforming to our views of better than expected U.S. economic growth, at year-end 2023 we may rotate from Cyclical Value to Defensive equity groups in advance of the rising U.S. recession risk we forecast in early 2024."

The S&P 500 traded around 4,402, just above the strategist's target.

— Fred Imbert

Medical device maker Shockwave Medical surged 7% on Monday after Morgan Stanley upgraded the company to an overweight rating.

"We think recent coronary reimbursement improvements from CMS mean the market is underestimating the penetration opportunity over the coming 2-3 years," wrote Patrick Wood.

According to the analyst, Wall Street is misjudging potential catalysts that could benefit shares.

Read more on the market moving call here.

— Samantha Subin

LPL Financial is bullish on the market for the rest of the year — and expects industrial stocks to be one of the best gainers amid its predictions of a broadening rally.

To be sure, the firm does believe the market is due for "a little bit of a consolidation phase" as it sees certain sectors of the market, particularly technology names, are overbought.

"But as we look to the second half, we're still optimistic. We did see broadening of the rally in June. So as tech kind of gave up some relative strength we saw industrials [and] consumer discretionary [stocks] participate more. ... So, underneath the surface certainly has a cyclical tone, which is what you want to see in a bull market."

Industrials are one of Turnquist's favorite sectors for second half of the year.

"We continue to like the industrial sector, and it's actually right near record high territory. So watching for a breakout there ...That's a big beneficiary of the whole reshoring team as companies bring back production and manufacturing to the US."

— Hakyung Kim

Carl Icahn's conglomerate Icahn Enterprises saw its shares pop 18% after the company said in a filing that it has amended the terms of his personal loans to separate them from the trading price of his company's shares. The issue was highlighted by short seller Hindenburg in a research note, which had triggered a dramatic sell-off in the stock.

Icahn will provide additional collateral of $2 billion from his personal funds and 320 million IEP shares in the amended agreement, the filing said.

Hindenburg Research took a short position against Icahn's company, alleging "inflated" asset valuations, among other reasons, for what it says is an unusually high net asset value premium in shares of the publicly traded holding company.

The stock is still down more than 30% this year.

— Yun Li

The second-quarter earnings season gets started with big banks and airlines over the next week, and corporate America is in a good position to beat low expectations, according to Goldman Sachs.

"Consensus expects a 9% year/year decline in S&P 500 EPS driven by flat sales growth and margin compression. We expect companies will be able to meet the low bar set by consensus. Negative EPS revisions for 2023 and 2024 appear to have bottomed and revision sentiment has improved," Goldman's chief U.S. equity strategist David Kostin said in a note to clients.

Notable earnings reports this week include PepsiCo and Delta Air Lines on Thursday, as well as JPMorgan and Citigroup on Friday.

— Jesse Pound

Stocks opened slightly higher Monday.

The Dow Jones Industrial Average gained 92 points, or 0.2%. The S&P 500 ticked up 0.15%, while the Nasdaq Composite inched up 0.02%.

— Hakyung Kim

Opinion continues to be split on whether the Securities and Exchange Commission will approve a spot bitcoin ETF after a recent wave of filings.

TD Cowen analyst Jaret Seiberg said in a note to clients on Monday that approval appears "inevitable" and that the inclusion of Coinbase as a listed custodian in the fund applications is a positive for the ETF issuers.

"We believe approval may be getting closer as industry addresses the SEC's concerns and the SEC looks to cement its authority over crypto. While a decision may be more than weeks or months away, we see this the start of the endgame in the push for a spot Bitcoin ETF," Seiberg said.

However, Bank of America strategist Alkesh Shah was less optimistic about approval, pointing to the SEC's skepticism about crypto trading platforms and regulatory history.

"For a historical perspective, silver futures began trading in 1933, but the first spot silver ETP wasn't approved until 2006," Shah wrote.

— Jesse Pound

Nvidia shares rose marginally before the bell after Goldman Sachs upped its price target on the chipmaker as it enters a new growth era.

"The recent step-function increase in the company's Data Center revenue outlook, however, suggests that the company has entered a new phase of growth driven by the emergence and proliferation of Generative AI," wrote analyst Toshiya Hari.

His new price target suggest shares of the key artificial intelligence beneficiary still have more room to run despite rallying about 191% since the start of the year.

Read more on the call from Goldman here.

— Samantha Subin

Here are some of the names making moves before the bell:

• Advance Auto Parts — The stock shed 3% in the premarket after being downgraded by Atlantic Equities to underweight. The firm also cut its price target to $50, implying about 28% downside.
• Icahn Enterprises — Shares popped 14% following a Wall Street Journal report that Carl Icahn untied his personal loans from the stock price, in response to recent attacks by a short seller.
• Meta Platforms — The social media giant gained 1% in premarket trading. Meta's new online platform Threads has attracted over 100 million users since its launch last week, per tracking site, Quiver Quantitative.

To see more names making moves in the premarket, read the full story here.

— Michelle Fox

Shares of this lesser-known Inflation Reduction Act beneficiary added 1.6% before the bell after Bank of America hikes its price target.

"FLEX should continue to benefit from the Inflation Reduction Act (IRA) which can help spur demand for clean energy and reshoring manufacturing back to the US. Inverters are included in FLEX's core renewables business which is part of its industrial segment," said analyst Ruplu Bhattacharya.

Read more on the call from Bank of America here.

— Samantha Subin

Shares of Mediterranean fast-casual chain Cava Group were up 3% Monday during premarket trading after a slew of Wall Street firms initiated coverage on the company with buy or overweight ratings.

JPMorgan analyst John Ivankoe initiated coverage with an overweight rating and $45 price target, citing its well-capitalized business model and strong total addressable market opportunity.

"We view this business as this well-designed operating platform and broadly-appealing consumer offering that can expand from its current 263 locations in 22 states to scale into a national brand built on a series of high ROI company-operated restaurants," he wrote.

Shares of Cava have rallied more than 80% since going public last month. Read more on how JPMorgan and other Wall Street firms recommend playing Cava here.

— Hakyung Kim, Samantha Subin

Strategists at Morgan Stanley warned that corporate profits will be under pressure for the rest of the year "as pricing power declines and costs remain sticky. Our US strategists remain of the view that 2H should see consensus downgrades."

"Inventory has grown sharply while demand, especially demand for goods, is falling. Companies will need to decide how they want to handle excess inventory and we believe many will turn to aggressive discounting; Autos is leading this debate," they wrote in a Sunday note.

— Fred Imbert, Michael Bloom

Kokou Agbo-Bloua, global head of economics, cross-asset and quant research, discusses the outlook for the U.S. and euro area economies as central banks grapple with sticky core inflation.

CNBC's Charlotte Reed speaks to Paschal Donohoe, the president of the Eurogroup, and Laurence Boone, France's minister of state for Europe, at the Aix-en-Provence economic forum.

The pan-European Stoxx 600 hovered fractionally above the flatline by mid-morning, having recouped opening losses of around 0.3%. Oil and gas stocks added 0.8% while basic resources dropped 0.9%.

— Elliot Smith

U.S. Treasury yields were mixed on Monday as investors awaited the latest comments from Federal Reserve officials and key inflation data due this week for clues about the central bank's next interest rate policy moves.

At 4:34 a.m. ET, the yield on the 10-year Treasury was up by over two basis points to 4.0698%. The 2-year Treasury was last trading around one basis point lower at 4.9209%.

Yields and prices move in opposite directions and one basis point equals 0.01%.

— Sophie Kiderlin

Alibaba's Hong Kong-listed shares rose as much as 5% in Monday morning trade amid hopes of the years-long scrutiny of its financial arm Ant Group coming to an end.

The stock opened strongly, although it has since pared gains to settle at about 3.2% higher than its Friday closing price.

The 7.12 billion yuan ($985 million) fine handed to Ant Group by Chinese regulators on Friday for violations of laws and regulations looks to mark the end of Beijing's two-year clampdown on its domestic tech companies.

Chinese regulators on Friday said most of the outstanding problems associated with the financial businesses of platform companies have been resolved and that the domestic tech industry will see "normalized supervision."

— Sheila Chiang, Lim Hui Jie

China's producer price index fell further than expected with a decline of 5.4% year-on-year, further than a fall of 5% that economists surveyed by Reuters expected.

Consumer prices remained unchanged year-on-year, widely in line with expectations while the month-on-month reading fell 0.2%.

The onshore Chinese yuan strengthened fractionally and last traded at 7.2194 against the U.S. dollar.

— Jihye Lee

Stock futures were opened little changed on Sunday ahead of two key inflation reports this week.

Futures tied to the Dow Jones Industrial Average slipped 3 points or 0.01%. Both Nasdaq 100 and S&P 500 futures were flat.

The consumer price index report for June is due out Wednesday morning, followed by the producer price index on Thursday.

— Brian Evans