Why BMW shares were pressured this week

Investing.com --The S&P 500 climbed to fresh records Wednesday, as Oracle led tech stocks higher following strong quarterly results and an unexpected cooling in inflation supported ongoing expectations for the Federal Reserve to cut interest rates next week.

At 12:45 ET (16:45 GMT), the Dow Jones Industrial Average traded 253 points, or 0.6%, lower, while the S&P 500 index gained 0.4% and had earlier hit a record of 6,555.97. The NASDAQ Composite rose 0.2%.

The three main averages on Wall Street all recorded new closing highs on Tuesday as sentiment remained buoyed by expectations that a Federal Reserve interest rate cut is coming next week.

A sharp downward revision to U.S. employment figures for the 12 months through March suggested that a possible cooling in the labor market may have been taking place even before President Donald Trump unveiled sweeping import tariffs in April. Bets that the Fed will slash rates by at least 25 basis points at its September 16-17 gathering were little changed following the numbers, while U.S. Treasury yields, which tend to move inversely to prices, moved higher.

PPI unexpectedly cools in August

Adding to this positive sentiment, U.S. factory-gate prices unexpectedly fell in August, pointing to easier-than-anticipated inflationary pressures that could bolster the case for the Federal Reserve to slash interest rates at its upcoming policy gathering.

The producer price index decreased by 0.1% last month, according to data from the Bureau of Labor Statistics on Wednesday. Economists had anticipated that the month-on-month figure would climb by 0.3% in August, following a downwardly-revised rise of 0.7% in July.

"The cooler-than-expected PPI report was largely the result of a decline in services costs in August with services costs falling 0.2%, marking the largest monthly drop since April," Stifel said in a recent note. 

Investors keep close tabs on the PPI gauge because a section of the data is used to determine a metric of inflation that is preferred by the Fed.

The more widely-watched consumer price index (CPI) is due on Thursday.

Traders now fully see a chance that the Fed will lower rates by at least 25 basis points next week, according to CME’s FedWatch tool. Odds of a more aggressive 50 basis point cut have also risen.

Oracle soars on strong earnings

In the corporate sector, Oracle (NYSE:ORCL) stock jumped sharply with investors excited by a bullish AI-backed outlook. 

Oracle’s MultiCloud database revenue, driven through partnerships with hyperscalers such as Amazon, Google, and Microsoft, surged an astonishing 1,529% in the quarter

The company said it now expects booked revenue at its Oracle Cloud Infrastructure division to surpass half-a-trillion dollars, a robust forecast which analysts said was a sign of solid demand for the group’s relatively low-cost, AI-powered offerings.

"While investors were expecting an incremental ~$120bn in RPO related to the $30bn ARR deal with OpenAI revealed in June, the company instead added $317bn q/q driven by four multi-billion contracts with three customers and now expects backlog to exceed $0.5 trillion in the coming months as additional deals are expected to be signed," Deutsche Bank said in a recent note.

The strong outlook for AI-led revenue fueled a bid in AI-related hardware stocks including NVIDIA Corporation (NASDAQ:NVDA), Broadcom Inc (NASDAQ:AVGO), CoreWeave Inc (NASDAQ:CRWV), and Dell Technologies Inc (NYSE:DELL).

GameStop (NYSE:GME) shares rose after the electronics retail company delivered a surprisingly strong second quarter, with revenue rising 22% to $972.2 million from a year earlier.

Elsewhere, Apple Inc (NASDAQ:AAPL) shares slipped as the tech giant unveiled its iPhone 17 lineup and refreshed Apple Watch and AirPods, including the much-anticipated ultrathin “iPhone Air” model. 

Apple’s iPhone 17 Pro will start at $1099, up $100 from the previous pro model, in line with analyst expectations. The tech giant also unveiled a $999 iPhone Air, which replaces the iPhone 16 Plus. The price of Apple’s entry-level iPhone 17 was kept at $799.

Synopsys Inc (NASDAQ:SNPS) stock slumped after the chip design software provider missed Wall Street estimates for third-quarter revenue on Wednesday, and Chewy (NYSE:CHWY) stock dropped sharply after the online pet retailer’s second-quarter report disappointed investors who were expecting more.

Peter Nurse, Ayushman Ojha contributed to this article

Investing.com -- Payment company BILL Holdings (NYSE:BILL) has found itself the target of a couple of prominent activist investors, including Starboard Value and Elliott Management, but a sneaky filing from a private equity firm could provide a hint about where things ultimately are heading.

The third-largest holder of BILL is an unknown firm by the name of ER Collective Holdings, which was formed in early 2025.  A registration document named Clearlake Capital’s general counsel as being behind the stealth firm, according to FT.com. ER Collective held a 7.4% stake in BILL as of the end of June. While the disguised stake suggests that Clearlake may have bigger plans, including a takeover of BILL, the private equity firm has not bid and has no plans to bid for BILL, according to sources familiar with the matter.

While Clearlake might not be a bidder, Elliott has its own private equity arm, and that could be part of the firm’s unknown plans. The FT reported on Tuesday that Elliott has at least a 5% stake in BILL.

Meanwhile, Starboard Value, an 8.5% holder, is trying to impose its will via a proxy contest, launched earlier this month. The firm nominated a slate of four directors for election to the Board at the company’s annual meeting of stockholders. Starboard may be taking this route on the belief that management is not open to selling the company.

BILL, for its part, said it is "committed to driving sustainable, long-term growth and value creation" and will consider Starboard’s nominees.

Clearlake declined to comment on its activities with ER Collective. Elliott, Starboard, and BILL have not responded to requests to comment.

Investing.com -- Bank of America upgraded Rocket Companies Inc to Buy from Neutral, saying lower interest rates and pending deal synergies should boost the mortgage lender’s earnings.

The brokerage raised its price objective to $24 from $21.

“Don’t overthink it – lower rates are good for Rocket,” analysts wrote. The company’s roughly 10% market share in refinancing makes it a strong beneficiary of a decline in mortgage rates.

BofA now expects two Federal Reserve rate cuts this year and three more in 2026, a shift that should help unlock refinancing volumes.

Mortgage rates have already eased to 6.55%, their lowest since February 2023.

BofA said refinancing applications spiked when rates dipped into the 6.6% to 6.7% range in June, and Rocket itself pointed to stronger refi activity in the second quarter.

“We think RKT would see an even more meaningful uplift to volumes as mortgage rates drift lower,” analysts said.

BofA raised its 2026 earnings forecast for Rocket by 11% to $1.02 a share, citing a 5% larger mortgage market under lower rate assumptions.

The bank also flagged Rocket’s pending $12 billion acquisition of Mr. Cooper as a potential catalyst. Rocket has outlined $500 million in cost and revenue synergies from the deal, with upside possible as 22% of Mr. Cooper’s servicing book carries rates above 6%, creating refinancing opportunities.

A separate $200 million synergy target from the recently closed Redfin acquisition is also on track, BofA said.

“We think there could be a positive revision cycle as mortgage market size estimates are revised higher,” the analysts wrote.

Key risks include mortgage rates staying elevated, which would limit refinancing volumes and weigh on Rocket’s growth.

Investing.com -- Soleno Therapeutics (NASDAQ:SLNO) stock fell as much as 28% before paring the decline to down 8% on Wednesday following reports of a patient death while taking the company’s VYKAT XR drug.

The biopharmaceutical company issued a statement clarifying that the serious adverse event, reported in the FDA’s Adverse Event Reporting System (FAERS), involved a 17-year-old male patient with multiple pre-existing conditions. According to Soleno, the treating physician reported the case as not related to treatment with VYKAT XR, and the company’s assessment concurs with this conclusion.

The deceased patient had a history of lymphedema, superficial thrombophlebitis, and obesity, weighing 326 pounds, and reportedly died from an apparent pulmonary embolus, the company stated.

Soleno emphasized that VYKAT XR has a "proven safety and efficacy profile" and received FDA approval following a comprehensive clinical program. The company noted that patients with Prader-Willi Syndrome, the condition VYKAT XR treats, often have significant comorbidities and reduced life expectancy due to various factors including cardiac or respiratory events and pulmonary embolism.

The company also pointed out that reports in the FAERS database do not establish causation between a drug and an adverse event. Soleno stated it does not intend to specifically comment on future adverse events unless they are directly related to VYKAT XR use and unexpected according to the U.S. Prescribing Information.

VYKAT XR (diazoxide choline) extended-release tablets received FDA approval in October 2023 for the treatment of hyperphagia in Prader-Willi Syndrome.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Investing.com -- PG&E Corporation (NYSE:PCG) stock rose 4%, Edison International (NYSE:EIX) gained 1%, and Sempra (NYSE:SRE) climbed 1.5% after California lawmakers reached an initial agreement to boost the state’s wildfire utility fund by approximately $18 billion.

The agreement, expected to be filed into legislative text on Wednesday, aims to shore up the fund that has been at risk of depletion following devastating January wildfires in the Los Angeles area. According to a report from Bloomberg, citing people familiar with the negotiations, the plan will split funding equally between ratepayers and utility shareholders.

This proposal is designed to stabilize utilities’ finances and limit shareholder losses in the face of increasing wildfire liabilities. California utilities have faced significant financial pressure as potential liabilities from state wildfires have heightened risks for companies like Edison International and PG&E.

The January wildfires that ravaged parts of the Los Angeles area prompted concerns about the sustainability of the California Wildfire Fund, which was established to help utilities manage wildfire-related costs. The fund’s potential depletion threatened to create additional financial uncertainty for the state’s utility companies.

The legislative action represents an important development for California’s utility sector, which has struggled with wildfire-related challenges in recent years. PG&E, the state’s largest utility, previously filed for bankruptcy in 2019 due to wildfire liabilities before emerging in 2020.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Investing.com -- Payment company BILL Holdings (NYSE:BILL) has found itself the target of a couple of prominent activist investors, including Starboard Value and Elliott Management, but a sneaky filing from a private equity firm could provide a hint about where things ultimately are heading.

The third-largest holder of BILL is an unknown firm by the name of ER Collective Holdings, which was formed in early 2025.  A registration document named Clearlake Capital’s general counsel as being behind the stealth firm, according to FT.com. ER Collective held a 7.4% stake in BILL as of the end of June. While the disguised stake suggests that Clearlake may have bigger plans, including a takeover of BILL, the private equity firm has not bid and has no plans to bid for BILL, according to sources familiar with the matter.

While Clearlake might not be a bidder, Elliott has its own private equity arm, and that could be part of the firm’s unknown plans. The FT reported on Tuesday that Eliott has at least a 5% stake in BILL.

Meanwhile, Starboard Value, an 8.5% holder, is trying to impose its will via a proxy contest, launched earlier this month. The firm nominated a slate of four directors for election to the Board at the company’s annual meeting of stockholders. Starboard may be taking this route on the belief that management is not open to selling the company.

BILL, for its part, said it is "committed to driving sustainable, long-term growth and value creation" and will consider Starboard’s nominees.

Clearlake declined to comment on its activities with ER Collective. Elliott, Starboard, and BILL have not responded to requests to comment.