Tech Stocks Ignite Wall Street Amid Economic Changes
This week, the tech sector dominated headlines. The Nasdaq Composite (IXIC) launched strongly after Tesla (TSLA) lifted the entire tech market with news that President-elect Donald Trump is considering easing restrictions on self-driving vehicles. As investors looked ahead to earnings from Nvidia (NVDA), a leader in artificial intelligence (AI), the tech-heavy index held onto its gains, even as the Dow Jones Industrial Average (DJI) dipped due to rising tensions between Russia and Ukraine.
After Nvidia’s earnings report, all leading indexes, including the Dow, Nasdaq, and S&P 500 Index (SPX), saw upward movement. The blue-chip index had a substantial jump as traders shifted their focus from tech stocks to cyclical stocks that tend to perform better in a strong economy. By the week’s close, investors analyzed the S&P’s preliminary services and manufacturing purchasing managers’ indexes (PMI), with all three major indexes poised for weekly gains.
Snowflake Soars After Impressive Earnings Report
This week, investors reviewed numerous quarterly earnings from both tech and retail sectors. Notably, software company Snowflake (SNOW) experienced a strong boost following an exceptional third-quarter earnings report, leading to its best trading day ever as analysts assessed the results. On the other hand, shares of fintech companies NetApp (NTAP) and Intuit (INTU) dropped after their earnings announcements.
In retail, Lowe’s Companies (LOW) sparked interest among options traders after increasing its financial outlook. Apparel chains Gap (GAP) and Ross Stores (ROST) saw their shares rise post-earnings, while BJ’s Wholesale Club (BJ) and TJX Companies (TJX) had very different results.
Analyst Insights: Robinhood Set to Thrive with New SEC Guidelines
In the wake of several optimistic outlooks following the recent election, analysts have remained active. Needham upgraded Robinhood Markets (HOOD), suggesting that the stock may gain from a new pro-crypto leadership position at the U.S. Securities and Exchange Commission (SEC). Meanwhile, Chewy (CHWY) received a rare double-upgrade from BofA Global Research, with analysts noting an uptick in pet adoptions this year.
While many biotech stocks faced declines following Robert F. Kennedy Jr.’s nomination to head the Department of Health and Human Services, Merus (MRUS) received an upgrade due to positive expectations surrounding its cancer treatments. On a different note, Roku (ROKU) found some support from Barid, while Goldman Sachs chose to downgrade Redfin (RDFN) to a sell rating.
Thanksgiving Week to Bring Key Consumer Data and Retail Earnings
A range of consumer data will be released next week, which is shortened due to the Thanksgiving holiday. The personal consumption expenditure (PCE) index is on the agenda. In addition, several retailers are set to announce earnings before Black Friday, including Abercrombie & Fitch (ANF), Best Buy (BBY), Dick’s Sporting Goods (DKS), Kohl’s (KSS), Macy’s (M), Nordstrom (JWN), and Urban Outfitters (URBN).
Schaeffer’s Senior Quantitative Analyst Rocky White outlines strategies for options traders during this holiday-shortened week, while Senior Market Strategist Matthew Timpane assesses potential market trends.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
