Midday Fly By: Tesla, IBM slide despite quarterly beats

The major averages were a bit lower near noon as investors continue to digest the latest round of corporate earnings reports as well as developments in the Middle East. Post-print declines from major players such as Tesla and IBM were counteracted by sharp gains from companies like Texas Instruments and American Airlines.

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Meanwhile, relations between the U.S. and Iran continue to be tense, as a lack of commitment from Iran reportedly led to U.S. Vice President JD Vance halting his trip to Pakistan for peace negotiations. Iran state media also reported that Tehran negotiators wouldn’t be present, referring to such discussions with the U.S. as a “waste of time.” Additionally, President Trump ordered the U.S. Navy on Thursday to “shoot and kill any boat” laying mines along the Strait of Hormuz after Iran’s navy said it seized two container ships in the strait.

Get caught up quickly on the top news and calls moving stocks with these five Top Five lists.

1. STOCK NEWS:

• Tesla (TSLA) reported upbeat Q1 results and said in a regulatory filing that it agreed to acquire an “AI hardware company” for up to $2B in Tesla common stock and equity awards
• IBM (IBM) reported better-than-expected Q1 earnings and revenue
• Texas Instruments (TXN) reported better-than-expected Q1 results and provided upbeat Q2 guidance
• ServiceNow (NOW) provided a “beat and raise” report for Q1
• American Airlines (AAL) reported upbeat Q1 results and cut its FY25 earnings outlook

2. WALL STREET CALLS:

• BofA upgraded Texas Instruments (TXN) to Buy on improving earnings power
• CSX (CSX) downgraded to Underweight at Morgan Stanley
• McDonald’s (MCD) upgraded to Neutral at Rothschild & Co Redburn
• JPMorgan (CAR) to Underweight on “unsustainable valuation”
• HSBC(OKLO) with a Buy rating and $96 price target

3. AROUND THE WEB:

• Voya Financial (VOYA) is facing pressure from activist investor Toms Capital Investment Management, to consider putting itself up for sale or offloading its underperforming health insurer arm, FT says
• Microsoft (MSFT) will have to face a mass lawsuit alleging it overcharged thousands of British businesses to use its Window Server software on services provided by Amazon (AMZN), Google (GOOGL), and Alibaba (BABA), Reuters reports
• Australia’s eSafety Commissioner, the company’s internet regulator, asked online gaming platforms, including Roblox (RBLX) and Microsoft’s (MSFT) Minecraft, to specify how they intend to protect children from being groomed and shield younger users from radicalization, Reuters says
• SoftBank (SFTBY) is seeking a $10B loan secured by its shares in OpenAI, Bloomberg reports
• BP (BP) shareholders rejected two company resolutions at its annual general meeting, expressing frustration over climate disclosures, with just over a quarter of investors supporting resolution asking BP to explain its oil and gas spending strategy, WSJ says

4. MOVERS:

• Penn Entertainment (PENN) gains after reporting quarterly results, with EPS and revenue beating consensus
• Applied Digital (APLD) increases after entering a lease agreement with a U.S. based hyperscaler
• STMicroelectronics (STM) and Comcast (CMCSA) higher in New York after reporting quarterly results
• Super Micro (SMCI) lower after BlueFin Research said the company lost a “significant contract” with Oracle (ORCL)
• ASGN (ASGN) and KKR Real Estate (KREF) fall after reporting quarterly results

5. EARNINGS/GUIDANCE:

• Keurig Dr Pepper (KDP) reported Q1 results and backed its guidance for FY26
• Thermo Fisher (TMO) provided guidance for Q2 and raised its outlook for FY26
• NextEra (NEE) reported Q1 results and reaffirmed its guidance for FY26
• Mobileye (MBLY) reported Q1 results, with its CEO commenting that the results “reflected a stronger than expected start to 2026”
• Pool Corp (POOL) reported Q1 results, with EPS and revenue beating consensus

INDEXES:

Near midday, the Dow was down 0.18%, or 88.62, to 49,401.41, the Nasdaq was down 0.28%, or 68.12, to 24,589.44, and the S&P 500 was down 0.05%, or 3.42, to 7,134.48.