The origin of the term "blue-chip stock" comes from poker.
In poker, blue chips are traditionally the highest-value chips. The term was first used in the 1920s by Oliver Gingold, an employee of Dow Jones, to describe stocks with high prices and strong reputations. Today, "blue-chip stocks" refer to large, stable, and financially sound companies with a history of reliable performance, such as Apple, Microsoft, or Johnson & Johnson.
Market Wrap
U.S. stock markets experienced significant volatility primarily due to geopolitical developments.
President Donald Trump announced new tariffs: 25% on imports from Canada and Mexico, and 10% on Chinese goods, effective Tuesday. This announcement led to an initial sharp decline in major indices, with the Dow Jones Industrial Average dropping up to 560 points before closing with a loss of 122 points. The S&P 500 and Nasdaq Composite also ended the day lower, down 0.8% and 1.2% respectively.
The market's initial reaction was driven by concerns over potential supply chain disruptions, increased costs for businesses, and the broader economic implications of escalating trade tensions. However, investor sentiment improved later in the day following announcements that the U.S. had reached agreements with Mexico and Canada to delay the implementation of these tariffs by 30 days, allowing time for further negotiations.
Despite this partial recovery, the uncertainty surrounding trade policies contributed to heightened market volatility. Investors remain cautious, anticipating potential retaliatory measures from affected countries and assessing the possible impacts on global economic growth and corporate earnings.
In response to these developments, there was a noticeable shift towards safer assets. Long-term U.S. government bonds saw increased demand, leading to a decline in Treasury yields. Additionally, the U.S. dollar strengthened against major currencies, reflecting a flight to safety amid the prevailing economic uncertainties.
Tesla's shares fell due to reports of declining demand in key markets, including a significant drop in Model 3 sales in California and challenges in several European countries.
GM's stock fell intraday by around 8% after new tariffs on imports from Canada, Mexico, and China were announced. The tariffs raised concerns about higher production costs and supply chain disruptions, particularly for automakers with significant operations in those regions. Shares recovered later in the day as delays in the tariffs were announced.
Newmont's stock rose as gold prices reached an all-time high. Investors sought safe-haven assets like gold amid global economic uncertainty, which boosted the performance of mining stocks.
IDEXX Laboratories reported strong fourth-quarter results, with earnings per share of $2.62 and revenue of $954 million, representing 13% earnings growth and a 6% increase in revenue year-over-year. This growth was driven by strong demand for veterinary diagnostic products and services. The company's Companion Animal Group (CAG) segment saw a 6% revenue increase, with recurring CAG Diagnostics revenue growing 7% organically. IDEXX also has plans to launch a Cancer Dx screening test for canine lymphoma and provided a full-year 2025 outlook with projected earnings per share between $11.74 and $12.24.
Constellation Brands' stock dropped after new U.S. tariffs on Mexican imports were announced, which threatened the sales of its Mexican beer brands like Corona and Modelo. However, the stock partially recovered after the U.S. suspended the tariffs following an agreement with Mexico.
Tyson Foods reported a strong first quarter for fiscal 2025, driven by exceptional performance in its chicken segment. The company achieved adjusted earnings per share of $1.14, surpassing analyst expectations of 90 cents. Revenue increased by 2.3% year-over-year to $13.62 billion, exceeding forecasts. Chicken sales reached $4.07 billion, with a 1.5% increase in volume. The CEO highlighted the company's diversified protein portfolio as key to meeting strong consumer demand, leading to a positive outlook for the fiscal year.
Crocs' shares declined by approximately 5.2% following news of a securities class action lawsuit. The lawsuit alleges that Crocs misled investors about the performance of its HEYDUDE brand by inflating revenues through excessive inventory stocking at third-party wholesalers. This legal issue has raised concerns about the company's transparency and growth strategy, contributing to the stock's decline.
Unlock Exclusive Insights!
You can preview data for the Magnificent Seven now :
