U.S. equities ended Monday's regular session on a positive note, with the S&P 500 (INDEXSP:.INX) climbing 0.72% to close at 7,537.43. The Nasdaq Composite (INDEXNASDAQ:.IXIC) surged 1.12% to 26,121.16, while the Dow Jones Industrial Average (INDEXDJX:.DJI) added 0.29% to finish at 53,055.91. However, after-hours trading painted a more subdued picture, with gains narrowing as decliners on the S&P 500 outpaced advancers by a ratio of 1.3-to-1.
Among the standout movers after the closing bell was electric vehicle manufacturer Rivian Automotive Inc (NASDAQ:RIVN), which dropped sharply following news of a 75-million-share public offering. The stock fell 9.09% in after-hours trading, making it the only name among MarketWatch's 20 most-active after-hours stocks to move more than 1%. Rivian projected second-quarter revenue between $1.55 billion and $1.65 billion, exceeding the $1.45 billion consensus estimate from LSEG data, but the offering overhang weighed heavily on investor sentiment.
In contrast, financial technology firm Fiserv Inc (NASDAQ:FISV) saw its shares rise 3.71% after the bell. The move came amid reports, citing the Wall Street Journal via Reuters, that major U.S. banks including JPMorgan Chase & Co (NYSE:JPM) and Bank of America Corp (NYSE:BAC) have held early discussions about acquiring a payments network owned by Fiserv. Reuters noted it could not independently confirm the report, but the speculation fueled buying interest in the stock.
Broadcom Inc (NASDAQ:AVGO) also made headlines during the regular session, jumping 3.7% after the company and Apple Inc (NASDAQ:AAPL) extended their custom-chip agreement through 2031. Emarketer analyst Jacob Bourne commented that locking in Broadcom through 2031 provides Apple with supply-chain certainty, while Broadcom gains relief from Apple's push to develop its own chips. Apple accounts for roughly 20% of Broadcom's annual sales, according to analysts cited by Reuters.
Among megacap stocks, Microsoft Corp (NASDAQ:MSFT) lagged, slipping nearly 1% after the company announced plans to cut approximately 4,800 jobs. Thomas Hayes, chairman at Great Hill Capital LLC, told Reuters that Microsoft cannot afford all of its capital expenditures, and the return on that spending remains uncertain. The job cuts and capex concerns weighed on the stock despite its broader market strength.
Looking ahead, earnings season is intensifying. LSEG I/B/E/S projects S&P 500 earnings to surge 24% in the second quarter, with FactSet slightly lower at 23.3%. Revenue growth is expected at 12.2%, according to FactSet. Analysts forecast earnings gains across 10 of 11 sectors, with Health Care being the only sector expected to decline. Revenue is projected to rise in all 11 sectors. The narrow breadth of the market's rally—driven by only a handful of names—leaves the index vulnerable if earnings disappoint.
Delta Air Lines (NYSE:DAL) and PepsiCo (NASDAQ:PEP) are set to report later this week, while the Federal Reserve will release its June meeting minutes on Wednesday. The ISM services PMI slipped to 54.0 in June, in line with estimates, and CME's FedWatch tool showed traders pricing in a 25% probability of a quarter-point rate hike at the Fed's July 29 meeting, according to Reuters.
