Stocks close lower for a third day as once-hot AI play Oracle falls, yields increase

All the three major averages finished with losses for the third time on Thursday.

The S&P 500 fell 0.50% to close at 6,604.72. The Nasdaq Composite also moved 0.50% lower, ending at 22,384.70. The Dow Jones Industrial Average decreased 173.96 points, or 0.38%, to post 45,947.32.

— Sean Conlon

CME Group shares rose nearly 2% on Thursday after Citi said it's moving off the sidelines.

Analyst Christopher Allen upgraded its rating to buy from neutral on the derivatives marketplace. Allen also raised his price target by $25 to $300, which implies a 13.5% upside over Wednesday's closing level.

"Current levels represent a positive risk/reward here ... given catalysts ahead, capital return story and defensive nature of the platform," Allen wrote to clients in a Thursday note.

— Alex Harring

If the Congress fails to reach a deal to fund the federal government prior to next week's deadline, the market could see some turmoil in the near term, according to Louis Navellier, founder and chief investment officer of Navellier & Associates.

"A side risk is that the rating agencies may use it as an opportunity to put the U.S. on credit watch, something they've done before, as they are not happy with the soaring debt levels anyway," he wrote. "If a shutdown happens, it is likely to bring short-term market volatility."

— Sean Conlon

Rosenblatt Securities is taking a bullish stance on Webull Corporation.

Shares of the digital investment platform were marginally higher in afternoon trading after analyst Chris Brendler initiated coverage of the stock with a buy rating and set his price target at $19, which implies 36% upside from Wednesday's closing level.

"The combination of zero commissions, mobile technology, and social media has driven retail trading into global prominence and, along with it, created opportunities for innovative new entrants to rapidly gain market share," the analyst wrote. "Combined with significant tailwinds from global 'retailification' and an expanding product set (crypto, prediction markets), we believe Webull can sustain 25+% top line growth through 2027 and significantly exceed current consensus estimates."

Brendler also noted that the stock is cheaper than Robinhood Markets. Year to date, Webull has risen more than 22%, while Robinhood has surged a whopping 229%.

"Although not cheap, we note that Webull's closest peers trade at even higher levels, most notably Robinhood (HOOD, Unrated) at 25x on 2026 revenues. More importantly, we think Webull will grow significantly faster both on the top and bottom line than HOOD and consensus," he also said. "While we can see the argument for HOOD's dominant franchise to command a premium, Webull is growing off a much smaller base and with a largely fixed expense base, Adjusted EBITDA growth should be even faster."

— Sean Conlon

Bitcoin miner Cipher Mining is lower on Thursday, swinging from a 9% premarket gain to a worse than 10% decline on heavy volume amid a pair of headlines. The stock was trading down more than 18% at session lows.

The company launched a proposed $800M 0.00% convertible senior notes due 2031 offering, earmarking proceeds for capped calls, its data center at Barber Lake and to accelerate the build-out of its 2.4GW high-performance computing pipeline.

Separately, Cipher disclosed a 10-year HPC colocation deal with Fluidstack. The transaction includes $3.0 billion in contract value over the initial 10-year period (up to $7.0 billion if two five-year extension options are exercised). Alphabet's Google will backstop $1.4 billion in lease obligations and receive warrants to buy 24 million in CIFR shares, around 5.4% pro forma stake.

CIFR shares have traded more than 74M shares as of noon Thursday, more than twice its 30-day average volume.

— Nick Wells, Gina Francolla

Needham downgraded Lululemon Athletica to hold from buy Thursday, saying the competitive environment has gotten too challenging for the athletic apparel maker.

Wall Street's earnings expectations for the year are also too high, analyst Tom Nikic said in a note to clients. Therefore, he sees more downside risk to numbers over the next six to 12 months, even if there is no deterioration in fundamentals.

"While we don't think the company has done anything damaging to the brand, the operating
environment is clearly very tough at the moment, and we think it's prudent to move to the sidelines until we get evidence that they are able to 'right the ship' domestically," Nikic wrote.

Shares of Lululemon were down more than 3% in afternoon trading.

— Michelle Fox

Intel reportedly seeking an investment from Apple is plausible, following a spate of recent endorsements for the chipmaker, according to Bernstein. However, the firm said the stock remains fundamentally challenged.

Intel shares popped 5% Thursday, after Bloomberg, citing people familiar, said the American chipmaker has approached Apple for a potential deal. Such a deal is possible after Nvidia just last week said it's investing $5 billion in the company. The chipmaker also has the U.S. government as an investor.

Yet, Berinstein's Stacy A. Rasgon, who has a market perform rating on Intel and an outperform rating on Apple, said Intel has to show it has the capacity to fill demand after losing its leadership in the chip industry.

"We have been of the belief that Intel remains fundamentally challenged though have been terrified to short it for exactly these reasons (with the shares up massively in investors' faces on announcements over the last several weeks)," Rasgon wrote. "In fact the President recently literally tweeted/'truthed' out a picture of himself watching the shares go up (we thought it was fake when we saw it and remain amazed that it was not), and as much as we hate to admit it 'Trump wants the stock to go up' may in fact be a valid bull case for now (not one we are prepared to make but given everything that is happening we wouldn't talk you out of it for now)."

"But we also worry that such pressure could ultimately be damaging especially if it forces Intel down paths that in hindsight we might discover they should not have taken," Rasgon continued. "For now we continue to watch (with our mouths remaining slightly ajar...)."

— Sarah Min

Mirion Technologies — The radiation detection name fell more than 8% after it announced a common stock offering of $300 million. Mirion is also selling $250 million in convertible bonds.

Worthington Steel — The metal processing company dropped 8% on mixed fiscal first-quarter results. While sales and operating income grew from the year-earlier period, but production volume declined.

Freeport-McMoRan — Shares of the mining company slid 5%, adding to Wednesday's 17% drop. The stock has been under pressure this week after Freeport declared force majeure at its Grasberg mine in Indonesia.

Read more here.

— Fred Imbert

CarMax shares tumbled more than 20% after missing Wall's Street's earnings expectations for the second quarter.

The used car retailer earned 64 cents per share on revenue of $6.59 billion. Analysts polled by FactSet had forecasted $1.04 in earnings per share and $7.01 billion, respectively.

If Thursday's slide holds through the closing, it would mark CarMax's worst day since September 2022. It would also be the stock's third worst day on record.

— Alex Harring

The path for the stock market is higher even if there is some near-term volatility around the interest rate outlook, according to UBS.

Indeed, the Wall Street firm expects the S&P 500 will reach 6,800 by June 2026 in its base case, while possibly hitting 7,500 in its bull case, as lower interest rates and the strength of artificial intelligence continues to power stocks.

"Any doubt over the Fed's future easing path could stoke volatility," the firm's Ulrike Hoffmann-Burchardi wrote on Thursday. "But we continue to believe that positive market fundamentals will likely drive equities higher in the coming months."

— Sarah Min

The CBOE Volatility Index, also known as Wall Street's fear gauge, rose on Thursday as stocks pulled back.

The VIX was at 17.02, as of 10:08 a.m. ET. Meanwhile, all three major averages were in the red as Treasury yields gained on the heels of the latest economic data.

— Sean Conlon

Stocks traded down on Thursday morning.

The S&P 500 dropped 0.6%, while the Nasdaq Composite declined 0.9%. The Dow Jones Industrial Average also fell 140 points, or 0.3%. 

— Sean Conlon

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

Oracle — The database software company shed 3.7% as worries around the AI trade continue to drag the stock lower. Rothschild & Co Redburn initiated coverage of Oracle with a sell rating, saying the market is "materially" overestimating Oracle's contracted cloud revenues.

Transocean — Shares sank 16.5% after the offshore driller announced its plans to sell 125 million shares of the company at a price of $3.05, significantly lower than Wednesday's close of $3.64.

Opendoor Technologies — The stock gained 3.5% following trading firm Jane Street's disclosure of a 5.9% stake in the online real estate platform.

To see more premarket movers, read the full story here.

— Michelle Fox

U.S. equity futures reached their lows of the day on Thursday as Treasury yields rose following the latest jobless claims data.

S&P 500 futures fell to a low of 6,653.50, while Nasdaq-100 futures dropped to 24,545.75. Futures tied to the Dow Jones Industrial Average hit 46,271.00.

— Sean Conlon

Initial claims for unemployment insurance were well below expectations last week, helping to douse caution at the Federal Reserve and elsewhere that the labor market is in danger.

First-time filings for the week ending Sept. 20 totaled a seasonally adjusted 218,000, down 14,000 from the prior week's upwardly revised figure and significantly less than the Dow Jones consensus estimate for 235,000, the Labor Department reported Thursday.

Read more here.

— Jeff Cox

The European Commission launched an antitrust probe into German software behemoth SAP on Thursday over concerns around its practices in software support services.

The investigation will look into "whether SAP may have distorted competition in the aftermarket for maintenance and support services related to an on-premises type of software, licensed by SAP, used for the management of companies' business operations," according to the Commission.

SAP said in a statement Thursday that it believed its policies and actions were fully compliant with EU competition rules.

"However, we take the issues raised seriously and we are working closely with the EU Commission to resolve them," a spokesperson said. "We do not anticipate the engagement with the European Commission to result in material impacts on our financial performance."

U.S. shares of the firm moved lower in premarket trading Thursday, losing more than 2%.

— Chloe Taylor, Ryan Browne, Sean Conlon

Nvidia is poised to be a big winner in the AI arms race as dealmaking in the space heats up, which could catapult its stock price to new highs, according to Barclays.

The investment bank, which has an overweight rating on shares, raised its price target to $240 from $200. That implies upside of 35.6%.

"We see [deals] largely flowing into the NVDA P&L over the next 5+ years, moving numbers materially higher and making this the most attractive name in our space," analyst Tom O'Malley said in the note to clients dated Thursday.

CNBC Pro subscribers can read more here.

— Liz Napolitano

MoffettNathanson analyst Michael Morton raised his rating on Chewy to buy from neutral and lifted his price target to $48 from $33. The new target implies upside of 28% from Wednesday's close.

"Our conviction is grounded in a refreshed industry model for pet household formation. In early 2024, our industry model forecasted a recovery in customer additions, and we missed the upgrade opportunity," Morton wrote.

"We once again turn to the model to project U.S. pet household gross adds for 2025 to 2027. We walk away confident the industry has worked through its Covid pull forward and is on a sustained path of recovery with Chewy demonstrating an ability to meet or beat consensus forecasts on customer net additions through 2025 and 2026," he added.

Chewy shares rose more than 1% following the upgrade.

— Fred Imbert

Intel shares gained 1.6% in after-hours trading on news that the chipmaker is in early-stage talks with Apple about securing an investment from the iPhone maker, Bloomberg reported, citing people familiar with the matter. Apple and Intel have discussed how to work more closely together, but the talks may not lead to an agreement, the report said.

A deal with Apple would come after Nvidia announced earlier this month that it will invest $5 billion in Intel as part of a deal to co-develop data center and PC chips. The U.S. government brokered a 10% stake in Intel in August as part of President Donald Trump's attempt to expand influence in the private sector.

The Bloomberg report said, citing sources, that Intel also has reached out to other companies about possible investments and partnerships.

— Pia Singh

Shortly after 6 p.m. ET on Tuesday, futures tied to the S&P 500 and Nasdaq-100 futures added nearly 0.1%. Futures tied to the Dow Jones Industrial Average ticked higher by 39 points, or nearly 0.1%.

— Pia Singh