Casino Stocks Jump as China Stimulus Lifts Outlook

Major U.S. equities indexes were mixed on the final trading day of the week as investors digested the latest Personal Consumption Expenditure (PCE) data showing consumer price pressures cooled in August, reinforcing expectations that the Federal Reserve will continue cutting interest rates.

The S&P 500 ticked 0.1% lower Friday, while the Nasdaq edged down 0.3% amid underperformance from the tech sector. The Dow added 0.3% to end the week at a record closing high.

Dell Technologies (DELL) was one of three stocks added to the S&P 500 Monday, sending shares higher earlier this week, but the stock gave back some of those gains Friday. Shares tumbled 5% Friday, in the steepest drop of any S&P 500 stock. The losses for Dell came despite bullish commentary from analysts at Deutsche Bank, who restarted coverage of the stock Thursday with a “buy” rating, forecasting double-digital sales growth driven by strength across servers, storage products, and commercial PCs.

Globe Life (GL) shares tumbled 4.7% after the insurer said it could face a lawsuit from the Equal Opportunity Employment Commission (EEOC). According to a Globe Life regulatory filing, the EEOC found “reasonable cause” to believe the company discriminated against six of its sales agents on the basis of sex. The provider of life, supplemental health, and annuity plans said it would defend itself against any potential legal actions, claiming the issue would not result in a material loss for the company.

Shares of PC and printer manufacturer HP (HPQ) fell 3.9% after Bank of America downgraded the stock to “neutral.” BofA analysts said margins from HP’s printer segment could retreat from currently elevated levels compared with their historical average. Although analysts suggested some upside potential in the PC segment, particularly from computers with artificial intelligence (AI) capabilities, they expect HP’s free cash flow (FCF) to plateau in the near term, with earnings growth driven exclusively by share buybacks.

Shares of casino operators moved higher following this week’s announcement of an economic stimulus in China, which could provide a boost to their properties in Macau. Wynn Resorts (WYNN) jumped 7.2% on Friday, notching the top performance in the S&P 500, after Morgan Stanley upgraded the stock to “overweight” and increased its price target. Analysts highlighted Wynn’s ongoing investments, high-end offerings, locations near newly launched attractions, and upcoming project in the United Arab Emirates. Shares of competitor Las Vegas Sands (LVS) were up 5.6%.

Shares of oil and gas exploration and production company APA Corp. (APA) posted a daily gain of 6%. Crude oil futures prices staged a slight recovery on Friday after dropping earlier in the week amid expectations of an output boost by major producers. APA also announced this week that it would extend its partnership with software infrastructure provider Palantir Technologies (PLTR) aimed at harnessing AI technology to help the energy company optimize its operational planning, supply chains, production, and contract management.