PayPal Bulls Look for Support

PayPal inventory is dipping on earnings, whereas Union Pacific and Norfolk Southern reportedly strike an enormous deal. The Every day Breakdown digs in.

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Tuesday’s TLDR

Earnings in focus with PYPL, SOFI
Client confidence report on faucet
UNP and NSC have an $85 billion deal

What’s Taking place?

This morning has featured earnings from a slew of corporations, together with UPS, Spotify, Boeing, UnitedHealth, and Procter & Gamble. Tonight, we’ll hear from Starbucks, Visa, Reserving Holdings, and extra.

It’s a busy week in that regard, however the financial calendar additionally has some noteworthy occasions as we speak — particularly, the JOLTS (Job Openings and Labor Turnover Survey) and the patron confidence stories, each set to be launched at 10 a.m. ET.

We’ll be searching for a robust JOLTS report back to reassure traders concerning the labor market, and a strong shopper confidence studying to gauge the well being of on a regular basis Individuals.

Zooming out, markets proceed to carry out effectively. The S&P 500 notched a brand new file excessive on Monday, clearing 6,400 for the primary time. It’s now up about 8.5% on the yr. The Nasdaq 100 additionally hit a file excessive on Monday and is up practically 10% thus far in 2025.

Chip shares like Superior Micro Units, Nvidia, and Broadcom have helped energy the newest transfer, with the SMH ETF set to open at file highs as we speak.

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The Setup — PayPal

Shares of PayPal are falling this morning, down barely in pre-market buying and selling after the agency reported earnings. The corporate beat on earnings and income expectations for final quarter and raised its full-year outlook. Administration now expects to earn $5.15 to $5.30 a share this yr, up from a earlier forecast of $4.95 to $5.10 a share. Venmo income rose 20% yr over yr. 

PYPL inventory has traded fairly effectively from the April lows, however take into account that it was north of $90 earlier this yr. Traders are hoping it will get again there sooner or later. Once we have a look at the chart, bulls would like to see PayPal discover assist above the 200-day shifting common, however finally, they only must see the inventory keep above the $73 space. 

If it will possibly do this, its present uptrend will stay intact and the inventory will be capable to keep above the 50-day shifting common. Nevertheless, if it will possibly’t do this, extra promoting stress might ensue. 

Choices

As of July twenty eighth, the January $100 calls had the best open curiosity — that means the most important open positions within the choices market — adopted by the December $72.50 calls, then the December $87.50 calls. 

On a dip, shopping for calls or name spreads could also be one method to reap the benefits of a pullback. For name patrons, it could be advantageous to have satisfactory time till the choice’s expiration. 

For people who aren’t feeling so bullish or who’re searching for a deeper pullback, places or put spreads may very well be one method to take benefit.

To study extra about choices, think about visiting the eToro Academy.

What Wall Road Is Watching

UNP

Union Pacific and Norfolk Southern are each in focus this morning after it was introduced that UNP will purchase NSC in an enormous $85 billion deal. The cash-and-stock deal would kind a transcontinental railroad large and would grow to be the business’s largest deal ever. 

SOFI

Shares of SoFi are in focus this morning as the corporate reported earnings, beating each revenue and gross sales expectations. Administration additionally gave a slight increase to the corporate’s full-year income and earnings outlook. Because of this, shares are increased by greater than 10% this morning. Dig in deeper to SoFi’s fundamentals. 

NVO

Novo Nordisk shares aren’t doing effectively this morning. At one level, the inventory was down nearly 30% in pre-market buying and selling. As gross sales for its key weight-loss drug waver, the agency was pressured to slash its income and earnings outlook. Novo can be present process a management change. Take a look at NVO’s charts.

Disclaimer:

Please be aware that as a result of market volatility, a few of the costs might have already been reached and situations performed out.