The Stock Market Update: GameStop, Robinhood, Cracker Barrel, and More

Key Takeaways

• The Dow, S&P 500, and Nasdaq were little changed at midday Friday, May 17, 2024, after all three indexes hit all-time highs earlier in the week amid hopes the Federal Reserve could move to lower borrowing costs.
• Robinhood Markets got a double upgrade from Bank of America, and shares took off.
• Cracker Barrel Old Country Store slashed its dividend as it began a shakeup of its operations, sending shares lower.

The stock market saw mixed movements on Friday, with the Dow, S&P 500, and Nasdaq holding steady after reaching record highs earlier in the week. Investors were optimistic about the possibility of the Federal Reserve lowering borrowing costs, which could further boost market sentiment.

One of the standout performers of the day was Robinhood Markets (HOOD), whose shares surged following a double upgrade from Bank of America. The investment firm cited Robinhood’s increasing retail engagement and organic growth as key factors behind the bullish outlook on the stock.

Meanwhile, Reddit (RDDT) shares also saw a positive uptick after announcing a partnership with OpenAI to integrate Reddit content into OpenAI’s ChatGPT chatbot. This move is expected to enhance user engagement and drive further growth for the social media platform.

Chemical maker DuPont (DD) experienced a boost in its stock price after receiving an upgrade from Jefferies. The investment firm highlighted strong end-market demand and the potential benefits of inventory restocking as factors that could drive DuPont’s volumes in the coming year.

On the flip side, Cracker Barrel Old Country Store (CBRL) faced a significant decline in its stock price after announcing a drastic 81% cut in its dividend. This decision is part of a strategic transformation plan aimed at reshaping the company’s operations. Additionally, Cracker Barrel revised its outlook, which further contributed to the negative sentiment surrounding the stock.

GameStop (GME), a popular meme stock, experienced a sharp decline as the video game retailer revealed plans to issue more shares in order to raise capital. Furthermore, the company’s first-quarter projections fell short of analysts’ expectations, leading to a sell-off in the stock.

DXC Technology (DXC) also faced challenges as its shares plummeted following an announcement of another restructuring initiative. The company provided guidance below estimates due to a slowdown in IT spending, which weighed on investor confidence.

In terms of commodities, oil and gold futures advanced during the trading session. The yield on the 10-year Treasury note increased, while the U.S. dollar strengthened against the yen but weakened against the euro and pound. Most major cryptocurrencies also saw gains in their prices.

Overall, the stock market exhibited a mix of positive and negative movements on Friday, with certain companies outperforming while others faced challenges. Investors will continue to monitor economic indicators and corporate developments to make informed decisions in the ever-changing market environment.

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