Market Gains Amid Strong Middle East Deals and Earnings Updates
Thursday, May 15, 2025
Markets closed mostly higher today, buoyed by positive developments that eased economic concerns. As President Trump continues his Middle East tour, significant deals are being established involving American firms. Highlights include:
Boeing (BA) will deliver over 200 jets to Qatar Airways, while a $142 billion military investment will be directed to Saudi Arabia. Additionally, companies like AMD, Cisco (CSCO), and others will contribute to billions in Saudi infrastructure projects. Furthermore, NVIDIA (NVDA) will supply 18,000 AI chips to a corporation chaired by Mohammed bin Salman (MBS).
Market Performance Overview
The Dow Jones Industrial Average gained 271 points, or 0.65%. The S&P 500 rose by 0.41%, and the small-cap Russell 2000 increased by 0.52%. In contrast, the Nasdaq, despite a strong 13% rise over the month, fell 7% today following news of an SEC investigation into Coinbase (COIN) and a cybersecurity attack. Shares of Meta (META) also declined by 2.3% after reports of a delay in its AI rollout.
Earnings Reports After Market Close: AMAT, TTWO, CAVA
After the market closed, semiconductor equipment maker Applied Materials (AMAT) reported mixed fiscal Q2 results. It surpassed the Zacks consensus on earnings by 8 cents, posting $2.39 per share, but its revenue of $7.1 billion fell slightly below expectations. The company raised its next-quarter earnings guidance to $2.35 per share, asserting that there has been “no change in customer demand” and confidence navigating supply chains amid tariff policies.
In stark contrast, Take-Two Interactive (TTWO), known for titles like Grand Theft Auto, announced a substantial one-time impairment charge, resulting in a significant miss on its fiscal Q4 earnings. Although revenues reached $1.58 billion, slightly higher than forecasted, the company also lowered its full-year revenue guidance, prompting a 2.6% decline in after-hours trading.
Cava Group (CAVA), a Mediterranean fast-casual restaurant chain, reported strong earnings, surpassing estimates on both fronts. With 22 cents per share—bolstered by a one-time tax benefit—this exceeded the Zacks consensus of 14 cents. Revenues grew to $332 million, above the anticipated $330.6 million, and same-store sales increased by 11% year over year. However, shares relinquished their recent 3.5% gains in after-hours trading.
Market Expectations for Friday
As we look to tomorrow, the focus on Q1 earnings season eases, even though several weeks remain until NVIDIA reports. Import and Export Prices will be released ahead of the market opening, alongside Housing Starts and Building Permits data for April.
Earlier today, the Homebuilders Confidence survey for May reflected a downturn, as high mortgage rates and housing prices remain barriers for many prospective buyers. Many are speculating that home prices may decline in the coming months. Additionally, a preliminary Consumer Sentiment survey for May will be available on Friday.
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Please note that the opinions expressed in this article are those of the author and do not necessarily reflect those of any specific financial institution.
