The stock market is trading lower midday after a winning month. The S&P 500 advanced 2.3% for August, marking its fourth consecutive month of gains.
The S&P 500 is down 1.5% midday, while the tech-heavy Nasdaq Composite has dropped 2.4%. The Dow Jones Industrial Average fell 1.1%, and the Russell 2000 Index decreased by 2.4%.
Trending stocks:
The semiconductor sector is down midday. Nvidia continued lower after its earnings report, down 8%. Taiwan Semiconductor, Broadcom, ASML and AMD also saw declines, ranging from about 5% to 6%.
All Magnificent 7 stocks are lower midday, except for Tesla, which added 0.6%.
Analysts have upgraded their ratings on Boeing and Unity Software, leading to changes in their stock prices.
Unity Software’s gaming engines are used in Pokémon Go, Monument Valley, and Call of Duty: Mobile.
Unity Software
S&P 500 big stock movers today
Five S&P 500 stocks making big midday moves are:
Molson Coors Beverage (TAP.A) +6.2% Dexcom (DXCM) +4.7% Ulta Beauty (ULTA) +3.5% Constellation Brands (STZ) +3.4% Campbell Soup (CPB) +3.2%
The worst-performing five S&P 500 stocks with the largest midday drop are:
Vistra (VST) -10.2% Constellation Energy (CEG) -8% KLA Corp (KLAC) -7.8% Nvidia (NVDA) -7.8% Boeing (BA) -7.7%
Stocks also worth noting with significant moves include:
Unity Software (U) +4.5%Alphabet (GOOGL) -2.8%Apple (AAPL) -2.2%Amazon (AMZN) -1.4%Microsoft (MSFT) -1.3%
Boeing declines after analyst downgrade
Boeing stock lost 8% after Wells Fargo analyst Matthew Akers downgraded the stock to underweight from equal weight and cut his price target to $119 from $185.
“Boeing had a generational free cash flow opportunity this decade, driven by ramping production on mature aircraft and low investment need,” Akers said in a Sept. 3 report. “But after extensive delays and added cost, we now see growing production cash flow running into a new aircraft investment cycle, capping FCF a few years out.”
“However, after extensive delays and added cost, we now see growing production cash flow running into a new aircraft investment cycle, capping free cash flow a few years out,” Akers said.
“We see the company’s free cash flow peaking by 2027 as aircraft development costs offset further production growth, and believe an equity raise is likely to further dilute the shares,” Akers argued. He sees Boeing doing a $30 billion equity raise by 2026.
Related: Analyst overhauls Boeing stock price target as cash issues persist
Boeing’s balance sheet contains $45 billion in net debt, and paying this down would consume all its cash through 2030, according to Wells Fargo.
Bank of America shares waver after Warren Buffett’s sale
Bank of America shares wavered after Warren Buffett’s Berkshire Hathaway disclosed on Friday it sold more shares last week.
A Friday filing revealed Berkshire sold 21.1 million shares on Wednesday, Thursday, and Friday for $848.2 million at an average $40.24 each.
Related: Warren Buffett’s Berkshire Hathaway just joined exclusive club
Berkshire is Bank of America’s largest shareholder but has been reducing its stake. Since the sales began on July 17, Berkshire has sold shares in 21 of the past 33 sessions. It reduced its stake by 14.5% with the sale of 150.1 million shares for $6.2 billion, an average price of $41.33 each, CNBC reported.
As of Aug. 30, Bank of America is Berkshire’s third-largest equity holding, representing around 11.4% of its portfolio, according to data pulled by CNBC.
Unity Software surges following analyst upgrade
Unity Software surged 10% in morning trading and at last check was up 3.4%. The market move followed Morgan Stanley’s upgrade of the stock to overweight from equal weight with an unchanged price target of $22.
“We now see clear potential for upward revisions in Create and greater stability in Grow,” said analysts at Morgan Stanley.
The videogame-software-development company is best known for its gaming engines, which are used in games including “Pokémon Go,” “Monument Valley” and “Call of Duty: Mobile,” according to the Financial Times.
More Wall Street Analysts:
Analysts reboot Grand Theft Auto maker’s stock price targetAmerican Express stock analyst flags concerning shift in consumer behaviorAnalyst resets Nvidia stock price target before earnings
Over the past 12 months, the company has underperformed the S&P 500 Index by 80%, but Morgan Stanley analysts now view forward estimates for Unity as “derisked.”
Morgan Stanley says the company’s game engine has maintained a 70% market share in mobile and “proven how deep its moats truly are,” as competitors have been unable to gain share at Unity’s expense.
Related: Veteran fund manager sees world of pain coming for stocks
