The S&P 500 closed higher on Monday, alongside the heavy Nasdaq Composite as July trading began.

The broad market index added 0.27% to close at 5,475.09, while the technology-heavy Nasdaq gained 0.83% to 17,879.30. The Dow Jones Industrial Average inched 0.13%, or 50.66 points, higher, to finish the session at 39,169.52.

— Brian Evans

Gauzy Ltd., an Israeli maker of “smart glass” technology that changes glass from opaque to clear and allows privacy and temperature controls, dropped as much as 10% intraday Monday after the three Wall Street investment banks that brought it public began research coverage less than a month after its $17-per-share IPO.

Gauzy had already tumbled 29% from its IPO through Friday’s close. On Monday, Barclays, the lead book-runner for the Gauzy IPO, rated it a new overweight, with a $24 price target, calling it “a compelling growth story with multiple ways to win” that has “exposure across a wide set of customers and multiple end markets” underpinning 30% compound annual growth in revenue.

TD Cowen, which began coverage of Gauzy on Monday with a buy and $24 price target, and Stifel (buy, $18 target), both served as book-running managers for Gauzy’s initial public offering on June 6.

— Scott Schnipper

Investors with newfound nerves around the presidential election may be candidates to turn to structured product ETFs that offer downside protection, in exchange for giving up some of the upside.

Several firms are launching new buffer and principal protection ETFs on Monday, part of a growing category that recently reached $40 billion in assets under management, according to JPMorgan. These funds use a series of options designed to protect an investor’s capital, as long as they hold onto the fund throughout its stated time period.

“If you watched the debate [Thursday] night like everybody else and you’re like oh my goodness what is our country doing, and you’re not so sure how you feel about the election, you can buy the six-month,” said Bruce Bond, CEO of Innovator Capital Management, one of the firms that pioneered this type of ETF.

— Jesse Pound

The concern about market breadth goes well beyond a handful of stocks outperforming the S&P 500, according to Wolfe Research.

“This [past] week, out of the 79 S&P 1500 industry groups we look at, just 5 made a 1-Month high,” technical analyst Rob Ginsberg said in a note to clients.

Those groups include communication services, broadline retail, software, communications equipment and consumer discretionary. Many of those groups are dominated by one or two Big Tech stocks, including Amazon in broadline retail.

“Needless to say, it’s slim pickings,” Ginsberg said.

— Jesse Pound

Although Federal Reserve rate cut expectations have been reduced compared to the start of the year, Principal Asset Management chief global strategist Seema Shah is keeping her positive outlook on risk assets for the second half of the year.

“The same economic strength that is delaying rate cuts should drive robust earnings growth, securing a still solid backdrop for equities, while macro resilience should ensure fixed income credit spreads do not widen meaningfully from their historically tight levels,” Shah said.

Shah noted that an extended period without rate changes, such as the 1995 to 1996 Fed pause, have historically been positive for equities. More opportunities should appear in the market beyond the megacap tech space, she added.

“Markets may have lost some of their gleam and unrestrained optimism has faded. Yet, the still robust macro backdrop, even without imminent rate cuts, should provide an almost perfect set-up for a risk-on environment,” Shah said.

— Hakyung Kim

McDonald’s $5 value meal offering could provide a turnaround for the struggling stock, according to Wells Fargo. 

The deal — which includes a McChicken or McDouble sandwich, four-piece chicken nuggets, small fries and a small drink — debuted on June 25 and will run for a month but may be extended, CNBC previously reported. The $5 meal is approximately a 40% discount compared to core menu prices, Wells Fargo said. 

The value offering comes as McDonald’s shares have fallen about 15% year to date as higher prices and lower sales in the Middle East resulted in weaker same-store sales in the first quarter.

CNBC Pro subscribers can read the full story here.

— Hakyung Kim

U.S. crude oil futures topped $83 per barrel Monday, rising more than 2% ahead of the Fourth of July holiday.

West Texas Intermediate booked a 6% gain last month on the back of fears of a wider Middle East war and expectations of rising summer fuel demand.

Gas demand has been soft but prices at the pump could rise with a record 60 million travelers expected to hit the roads ahead of Fourth of July, according to AAA.

Oil market speculators have added long positions, betting on higher prices as tensions between Israel and the Iran-backed Hezbollah militia in Lebanon have “proven to be a major driver of the strong price action of late,” commodity strategists with TD Securities told clients in a note Friday.

— Spencer Kimball

Stocks are in a seasonally strong period for markets, but weak breadth is still a concern, according to JC O’Hara, chief market technician at Roth MKM.

The S&P 500 tends to do well in the month of July, having risen in the past nine years, according to the technician. The Nasdaq 100 has done even better, finishing positive for 16 straight years. But the market performance continues to remain bifurcated even as investor sentiment remains bullish. While 30% of the S&P 1500 is in an uptrend, 35% is in a downtrend, the technician noted.

“From a top down perspective, the S&P 500 touched new highs last week but there have been fewer and fewer stocks also touching new 52-week highs. Just 3.4% of the market made new highs on Friday,” O’Hara said in a note titled “Breadth Continues to Be a Concern Into a Seasonal Sweet Spot on the Calendar.”

“The Bears will point to the contraction of new highs and suggest breadth deterioration; however, the Bulls will counter with the lack of new lows,” he added.

— Sarah Min

Tesla surged on Monday, breaking through a critical technical momentum barrier ahead of Q2 delivery numbers expected this week. For the first time since early January, TSLA traded above its 200-day moving average, regaining some of the momentum that has been missing for the electric carmaker this year. The stock is now on track for its fifth straight positive session, marking its longest rally since July 2023.

Despite this recent uptick, TSLA has been the underperformer among the so-called Magnificent Seven, which also includes Nvidia, Meta, Amazon, Alphabet, Microsoft and Apple. Even with today’s gains, TSLA remains down more than 15% year to date in 2024. Wall Street remains divided on TSLA’s prospects, with 44% of analysts giving it a positive rating and 20% a negative one, according to FactSet. The average price target for TSLA on Monday stood at $184.15 per share, indicating a potential 12% downside from its midday trading price.

— Nick Wells

Fundstrat’s Tom Lee is standing by his $150,000 forecast for bitcoin despite recent weakness in the cryptocurrency.

Bitcoin has been stuck in a tight trading range between $60,000 and $70,000 since it touched an all-time high of about $73,000 in March. At the end of June, it slid to the lower end of that range after the trustee of the now defunct Mt. Gox crypto exchange said it will begin repayments to creditors in July — 142,000 bitcoins worth $9 billion at today’s prices.

“Bitcoin’s probably suffering from Mt. Gox starting distributions in July — that was a huge overhang for many years,” Lee told CNBC’s “Squawk Box” on Monday morning. “If I was invested in crypto, knowing that one of the biggest overhangs is going to disappear in July, I’d think it’s a reason to actually expect a pretty sharp rebound in the second half.”

Read the full story here.

— Tanaya Macheel

While the year started off with promise for biotech stocks, as M&A activity returned and biotech capital markets opened up, the sector ended the first half of the year up around 4%, based on both the SPDR S&P Biotech ETF (XBI) and the Nasdaq Biotechnology Index. That is a modest performance when compared to the S&P 500’s 15% gain.

Goldman Sachs analysts see opportunity in the second half tied to specific events that could be catalysts for the stocks in either direction. Among the companies to watch are ArriVent Biopharma, which is working on a lung cancer treatment; 4D Molecular Therapeutics, which has data coming at a conference in mid-July for its gene therapy for wet age-related macular degeneration; and Terns Pharmaceuticals, which will release results from a phase 1 study of its oral GLP-1 obesity treatment.

They also mentioned a key investor meeting BioMarin Pharmaceutical will host Sept. 4 to discuss the rare and genetic disease specialist’s future strategy and pipeline. The stock has struggled this year, logging a more than 13% drop, but a strong message from new CEO Alexander Hardy might prompt investors to reevaluate.

— Christina Cheddar Berk

Here are some of the stocks making the biggest moves during midday trading:

• Chewy, GameStop — Chewy’s stock dropped about 6% after a regulatory filing showed meme stock trader Keith Gill, who is also known as “Roaring Kitty,” bought nine million shares, amounting to a 6.6% stake in the pet food e-commerce company.
• Boeing, Spirit AeroSystems — Boeing on Monday said it would buy back fuselage maker Spirit AeroSystems in a $4.7 billion all-stock deal. Shares of Boeing and Spirit AeroSystems rose more than 3% each.
• Trump Media & Technology Group — Shares of Trump Media & Technology Group rose 3%, following a roughly 11% loss during Friday’s session.

Read the full list of stocks on the move here.

— Samantha Subin

As the second half of the year gets underway, there are still more questions than answers in the market, according to BTIG.

“Namely the breadth expansion that was occurring in late ’23 fizzled out and was never able to find its footing despite cooling inflation and lower long-term rates,” BTIG chief market technician Jonathan Krinsky wrote in a note Sunday.

The equal-weight S&P 500 has underperformed the S&P 500 by nearly 10% over the first six months, he pointed out. That is one of the worst stretches on record going back to 1990 and “by far the worst ‘first six months’ of the year,” he said.

“If small-caps are going to work, we think they have to start soon or they become the ‘canary in the coalmine’ rather than a rotation opportunity,” Krinsky wrote.

Meanwhile, 10-year Treasury yields continue to be rangebound, he said.

— Michelle Fox

The stock market and economy are running out of time for a “goldilocks” scenario and that could create a painful reversal for investors, according to JPMorgan.

Strategist Mislav Matejka said in a note to clients that stock valuations look stretched even as the Federal Reserve is still waiting on rate cuts and economic growth is slowing.

“There is no safety net anymore, the market is positioned long, Vix is at lows, potentially underpricing risks and credit spreads are extremely tight — this is as good as it gets,” the note said.

— Jesse Pound

Cruise stocks took a leg down on Monday as a powerful storm worried investors.

Norwegian Cruise Line and Carnival both dropped close to 5%, while Royal Caribbean slid more than 2%.

This decline comes as the southeastern Caribbean region braces for Hurricane Beryl, a Category 4 storm expected to make landfall on Monday. Its strength and early timing may be stoking fears about what the hurricane season will bring, in turn alarming traders who don’t want to see weather-related cancellations.

With Monday’s retreats, Norwegian and Carnival are now down more than 11% and 4%, respectively, on the year. Royal Caribbean has outperformed its peers, climbing more than 20% so far in 2024.

— Alex Harring

Recent history bodes well for the market entering the new month.

The Dow, S&P 500 and Nasdaq Composite have climbed every July for the past several years. The last time any of the major indexes traded lower in the month was 2014, when all three ended in the red.

In some cases, July has brought eye-popping gains for the indexes. In 2022, for example, the S&P 500 and Nasdaq jumped more than 9% and 12%, respectively, in the month. The Dow finished that month higher by more than 6%.

— Alex Harring, Peter Schacknow

The U.S. manufacturing sector in June edged further into contraction territory, according to the Institute for Supply Management’s monthly survey of purchase managers.

The ISM manufacturing index came in at 48.5%, representing the share of managers who reported expansion for the month, down 0.2 percentage points from May. A reading below 50% indicates contraction. Economists surveyed by Dow Jones had been looking for 49.2%.

Elsewhere in the survey, the prices index slid to 52.1%, down 4.9 percentage points, while new orders rose 3.9 percentage points to 49.3%.

In other economic news, construction spending declined 0.1% in May, against the consensus estimate for a 0.2% increase, according to the Census Bureau.

— Jeff Cox

Stocks opened higher on Monday as the second half of trading in 2024 kicked off.

The S&P 500 added 0.2%, while the Nasdaq Composite gained 0.1%. The Dow Jones Industrial Average added 200 points, or 0.5%.

— Brian Evans

Bitcoin and stocks whose performance is tied to the cryptocurrency traded in the green to begin July on Monday.

Bitcoin rose 5% over the weekend, according to Coin Metrics, to start the week at the $62,000 level. Investors are expecting recent weakness — it recently slid to the lower end of the $60,000 to $70,000 range it has been stuck in since March — could linger in July but are optimistic about the second half of the year.

Coinbase and MicroStrategy were each up about 2% in premarket trading. Mining stocks, including CleanSpark, Iris Energy, Riot Platforms and Marathon Digital, were in the green across the board.

For more on the near-term downside risk in bitcoin, read our July outlook here.

— Tanaya Macheel