Wednesday’s Top Analyst Upgrades and Downgrades: ADM, Baidu, Melco Resorts, Palantir, Peabody Energy, Philip Morris, Shopify and More

The futures were lower after a sluggish start to the holiday-shortened trading week. All the major indexes closed in the red Tuesday, as investors and traders are quickly closing in on the end of the first half of 2023. Top Wall Street analysts have pointed out that the recent rally really has been a narrow melt-up of top technology stocks, especially those related to artificial intelligence. However, they also cite improving overall breadth in the market, some big-time short covering and, once again, as we saw during the pandemic trading, the FOMO or “fear of missing out” syndrome as factors that could push the rally a little higher.

Treasury yields were lower across the curve, as the buyers from last week returned to add bonds on Tuesday. While the Federal Reserve pause on rate hikes was viewed as a short-term positive, Fed Chair Powell has signaled that an additional 50-basis-point increase is likely on the way, and the terminal or final rate for federal funds will be in the 5.6% ballpark. The 10-year note closed on Tuesday at 3.73%, and the two-year note wrapped up the day at 4.68%, closing in on a 100 basis-point inversion difference.

Brent and West Texas Intermediate crude both finished the day lower, after some solid gains last week. Analysts cited higher than expected Russian exports, which come after the country had pledged to cut production by 500,000 barrels per day. With the Chinese attempting to jumpstart their economy by trimming rates and boosting refinery levels, many feel that the second half of the year could bring higher prices. Natural gas finished Tuesday at $2.50, down over 5% for the day.

Gold closed down over 1% to finish the day at $1,948. The bullion continues to consolidate the gains that were posted during the spring and into the summer. Bitcoin exploded higher in the afternoon to close up over 4% at $27,798.50.

24/7 Wall St. reviews dozens of analyst research reports each day of the week with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.

These are the top analyst upgrades, downgrades and initiations seen on Wednesday, June 21, 2023.

Allstate Corp. (NYSE: ALL): Morgan Stanley started coverage with an Equal Weight rating and a $117 target price. The consensus target is up at $135.15. The shares closed on Tuesday at $108.59.

Arch Capital Group Ltd. (NASDAQ: ACGL): Morgan Stanley started coverage with an Overweight rating and a $92 target. The consensus target is $84.25, and the shares closed on Tuesday at $70.79.

Archer Daniels Midland Co. (NYSE: ADM): Jefferies resumed coverage with a Hold rating and bumped its $82 target price up to $85. The consensus target is $96.99. The stock closed on Tuesday at $74.08.

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