Major tech stocks rebounded on Wednesday as the rotation into cyclical stocks paused. The Nasdaq Composite was the top-performing index, while the Dow Jones Industrial Average and small cap Russell 2000 lagged.
Wednesday's market moves by the numbers
- The Dow fell 21 points, 0.07%, breaking a two-day win streak.
- Week-to-date: The Dow is up 3.80%, on pace for its second-positive week in a row.
- Dow Impact: Boeing (BA) had the most negative impact on the Dow, accounting for 43 points against the index.
- The S&P 500 gained 27 points, 0.77%, its second-positive session in three.
- Week-to-date: The S&P is up 1.80%, on pace for its second-positive week in a row.
- SPY Impact: Apple (AAPL) had the most positive impact on the SPY, adding 0.70 points to the ETF.
- The Nasdaq Composite gained 232 points, 2.01%, breaking a two-day losing streak.
- Week-to-date: The Nasdaq is down 0.91%, on pace for its third-negative week in four.
- NDX (.NDX) Impact: Apple (AAPL) had the most positive impact on the NDX, adding 48 points to the index.
- The Russell 2000 fell 0.004%, breaking a two-day win streak.
- Week-to-date: The Russell 2000 is up 5.64%, on pace for its third-positive week in four.
— Chris Hayes
Tech shares pull the S&P 500 higher
Investors rushed back into the tech sector following its two-day slide, pushing the Nasdaq Composite 2% higher on Wednesday. The S&P 500 eked out a 0.8% gain, while the Dow Jones Industrial Average closed the session flat as the rotation into cyclical stocks took a breather.
— Yun Li
Oil turns in its third straight day of gains
- WTI (DEC) settled up 0.22% at $41.45 for its third straight day of gains after hitting a high of $43.06, its highest level since Sept. 2
- WTI is up 11.6% this week, on pace for its best week since May 22
- WTI is still down 32.26% this year, on pace for its worst year since 2014.
— Gina Francolla
Zoom Video jumps 10% in heavy volumes
Shares of Zoom Video surged as much as 10% on Wednesday, rebounding from the steep losses earlier this week amid the big market rotation out of stay-at-home bets. Wednesday's gain also came amid heavy trading volumes — more than 10.5 million shares have changed hands as of early afternoon trading, surpassing its 30-day average of 9.4 million shares, according to FactSet. The stock plunged 17.4% on Monday and another 9% on Tuesday following news of a potentially effective vaccine. Zoom is up a whopping 500% this year.
— Yun Li
Stocks making the biggest moves midday
Lyft — Shares of the ride hailing company rose more than 3% after executives said the company can become EBITDA profitable by the fourth quarter of 2021 even if there's a slower-than-hoped-for recovery.
Datadog — The cloud company tanked more than 10% despite beating on the top and bottom lines of its quarterly results.
FuboTV — Shares of the sports streaming company rallied more than 22% on the back of quarterly revenue that beat analyst expectations.
Read more companies making big headlines during midday trading here.
— Yun Li
Markets at midday: S&P 500 and Nasdaq outperform as tech tries to recover
The S&P 500 rose 0.8%, and the Nasdaq Composite advanced 1.8% as technology stocks recovered some of their steep weekly losses. Facebook, Amazon, Apple, Netflix and Microsoft were all up more than 1%. The Dow lagged, rising just 57 points, or 0.2%, following back-to-back sessions of massive gains.
Revlon surges after announcing results of bond exchange program
Beauty stock Revlon surged 30% on Wednesday after the company announced that $236.5 million of outstanding bonds were tendered into the company's exchange program as Revlon looks to stave off bankruptcy. There was roughly $343 million in aggregate principal for the bond issuance in question, which is due in Feb. 2021.
The New York Post reported that Carl Icahn was among the bondholders who participated in the exchange program. Bondholders received roughly 32.5% of the principal amount for participating in the program.
— Jesse Pound
Dow turns negative
The Dow slipped into negative territory as the recent rotation into cyclical stocks reversed slightly. The 30-stock average was down 40 points, or 0.1%, while the tech-heavy Nasdaq Composite was up 1.4%.
— Jesse Pound
Stifel downgrades Aurora, Tilray to sell
Stifel analyst Andrew Carter downgraded Aurora Cannabis and Tilray to sell from hold on Wednesday, saying that the excitement around expanded legal marijuana in the United States has gone too far for the stocks.
"We do not believe either company has demonstrated an enduring right-to-win for new market opportunities, particularly in the U.S., with the increasing competitiveness of the Canadian market challenging each company's respective outlook and with liquidity needs likely driving downside for the shares," Carter said.
The stocks were down sharply in early trading, with Tilray shedding more than 8% and Aurora dropping 21%. Aurora also announced a secondary stock offering on Tuesday.
— Jesse Pound
Stocks climb at the open as tech stocks, Nasdaq outperform
U.S. stocks on Wednesday notched another solid opening gain as the optimism about Pfizer's Covid-19 vaccine that had fueled cyclical stocks earlier in the week broadened to include some technology companies that had thus far lagged.
The Nasdaq Composite, the relative leader at the opening bell, rose 0.85%. The Dow Jones Industrial Average added 130 points while the S&P 500 gained 0.55%.
Some of the strongest gains on the Street Wednesday morning came from Amazon, Nvidia and Broadcom, which rose 1%, 2.4% and 2%, respectively.
Time to get 'aggressive' on bank stocks, Wells Fargo says
Bank stocks still have room to run even after a sharp jump for the sector this week, Wells Fargo said in a new note.
"We advise getting aggressive on Banks despite Monday's ... run-up. In Banks we have historic valuations, significant scope for upside potential, an uncrowded opportunity, and catalysts in the form of fundamentally-driven reflation and near-term Covid solution(s)," the note said.
CNBC Pro subscribers can read more about the call here.
— Jesse Pound
Here are Wednesday’s biggest analyst calls of the day: Dave & Buster’s, CrowdStrike, Yelp & more
- JPMorgan downgraded Occidental Petroleum to underweight from neutral.
- Evercore ISI upgraded Yelp to outperform from in line.
- Baird upgraded CrowdStrike to outperform from neutral.
- Cowen upgraded Tapestry to outperform from market perform.
- Longbow downgraded Dave & Buster's to neutral from buy.
- Susquehanna upgraded D.R. Horton to positive from neutral.
- Bank of America downgraded Pentair to underperform from buy.
- Deutsche Bank upgraded Charles Schwab to buy from hold.
Pro subscribers can read more here.
Goldman hikes S&P 500 target, sees a 20% gain by end of 2021
Pfizer's promising vaccine news prompted Goldman Sachs to lift its stock-market outlook on Wednesday.
The firm hiked its year-end S&P 500 target to 3,700 from 3,600, a 4% rise from Tuesday's close of 3,545.53. Goldman also expects the broad equity benchmark to rally to 4,300 by the end of 2021, which represents a 21% gain from here.
"A vaccine is a more important development for the economy and markets than the prospective policies of a Biden presidency," David Kostin, the bank's chief U.S. equity strategy, said in a note on Wednesday. "The much-awaited results from Pfizer (PFE) that its COVID-19 vaccine has an efficacy rate greater than 90% is a positive event that will allow society to gradually normalize during 2021."
— Yun Li
Cyclical stocks continue to rise
Cyclical stocks climbed in premarket trading Wednesday and looked to extend strong week-to-date gains as investors continue to snap up equity of companies that would benefit most from an economic recovery.
Though growth stocks appeared set to outperform cyclicals on Wednesday, the economically sensitive group is still far outpacing other equities on the week. The move for GM puts the stock up 12% for the week, while the other three names all saw double-digit gains on Monday alone.
— Jesse Pound
Tech shares rise in the premarket, trying to claw back some of this week's losses
Shares of major tech companies rose before the bell on Wednesday following consecutive declines during a market rotation earlier in the week that favored beaten-down cyclical stocks.
Coming into Wednesday's session, however, Facebook and Amazon were down 7.2% and 8.4%, respectively, for the week. Apple and Alphabet had lost 2.3% and 1.3%, respectively. Netflix was down 6.7% for the week and Microsoft had lost 5.7% over that time period.
"An abrupt macro positive shock such as we saw this week can lift all value stocks for a time," Inigo Fraser-Jenkins, co-head of the portfolio strategy team at Bernstein, wrote in a note. "However, we think that the outlook for the next year has to be more nuanced.
"Real yields are likely to be held low and there is still a greater longevity of growth for high Growth companies, thus we think it is right to remain overweight Growth companies where [it is reasonable] to believe their growth can be sustained," Fraser-Jenkins said.
Futures pop again with Nasdaq, tech names set to outperform
Investors looked to continue the week's already-robust market rally on Wednesday with future contracts tied to all three major indexes pointing to gains at the opening bell.
S&P 500 futures rose 0.85%, Dow futures rose 0.75% and Nasdaq-100 futures added 1.1% around 7:30 a.m. ET. The premarket moves in Dow futures pointed to an opening pop of about 200 points for the blue-chip names.
Big-tech and popular stay-at-home trades that had underperformed on Monday and Tuesday on the heels of Pfizer's vaccine announcement appeared set to outperform on Wednesday. Amazon, Apple and Microsoft all added at least 1% in the premarket session.
Facebook and Netflix each added about 0.9%.