Major indexes improved midway through the stock market today, as investors were comforted by Federal Reserve Chairman Jerome Powell’s comments Wednesday regarding future interest rates.
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Powell told the House Financial Services Committee it was too soon for rate cuts, but added they are likely “at some point” this year. He indicated there’s a sweet spot between cutting rates too soon — and by too much — and waiting too long to ease policy. He said waiting too long could unduly weaken economic activity and employment.
Powell was still testifying before the House panel at noon ET Wednesday. He also is due to speak before the Senate Banking Committee on Thursday. Markets now expect Fed rate cuts to begin in June with a 59.5% probability, according to the CME FedWatch Tool.
In other economic news, the February Automated Data Processing employment report showed an increase of 140,000 private jobs on payrolls vs. the 150,000 consensus, and much higher than January’s revised 111,000 additions.
The Labor Department’s January Job Openings and Labor Turnover Survey, or JOLTS, came in lower than expected at 8.863 million job openings vs. the 8.9 million forecast. It was slightly below December’s revised 8.889 million.
Stock Market Today: Indexes Applaud Powell’s Comments
The Nasdaq jumped more than 1% in Wednesday’s action. Meanwhile, the Dow gained 0.6%, while the S&P 500 added 0.9%. The small-cap Russell 2000 climbed 0.8%.
Volume rose slightly on the New York Stock Exchange and fell on the Nasdaq compared with the same time on Tuesday.
The Invesco QQQ Trust (QQQ) exchange traded fund rose 1.3%. The Innovator IBD 50 ETF (FFTY) outperformed the major indexes and surged 2.7% on the stock market today.
The 10-year Treasury yield shed 4 basis points to 4.1% and fell to a one-month low after Powell’s remarks on Wednesday.
West Texas Intermediate Crude jumped 2.4% to around $80 a barrel.
Meanwhile, bitcoin’s price stood more than $67,000 in recent trades. Crypto-related stocks such as MicroStrategy (MSTR), Coinbase (COIN) and Marathon Digital (MARA) all climbed Wednesday morning.
Big Stock Movers: JD.com Rallies, Foot Locker Falls
Chinese online retailer JD.com (JD) gapped up more than 16% following a beat on its fourth-quarter profit and revenue projections and announcement of stock buyback program up to $3.0 billion. The stock is on pace for its largest one-day rise since March 16, 2022, when it gained 39.36%, according to Dow Jones.
Foot Locker (FL) plummeted 29% in heavy trading even after the footwear retailer topped fourth-quarter profit and revenue estimates. But investors clued in on its fiscal 2024 earnings forecast that came in below projections and soft sales estimates. The stock sank from a cup base buy zone to deep below its 50-day line triggering a sell signal. Foot Locker stock also undercut its 200-day moving average.
IBD 50 name CrowdStrike (CRWD) gapped up around 11% in heavy volume after the cybersecurity firm topped its January-ended quarter earnings and sales estimates. It also gave a fiscal 2025 revenue outlook that was above analyst projections.
The jump comes following Tuesday’s 5.2% drop that tested its 50-day moving average. The stock is on track for its largest one-day increase since March 20, 2020, when it rose 17.42%, according to Dow Jones Market Data. CrowdStrike reached an all-time high Wednesday.
Couchbase (BASE) gapped up but was off morning highs, following the database software company’s smaller-than-expected fiscal fourth-quarter loss and higher revenue. The stock is extended from a 24.61 alternate entry and hit a 52-week high on the stock market today.
Stock Market Movers: Palantir Jumps On Army Contract
Palantir Technologies (PLTR) jumped nearly 10% after the data analytics software maker announced it won a $178 million U.S. Army contract for Project Titan, a battlefield system using artificial intelligence. Palantir stock also reached a 52-week high on the stock market today.
Enterprise software stock Box (BOX) gained around 7% after the company beat its fiscal-fourth quarter earnings estimates but slightly missed revenue views. The stock is in a long, undefined base with a 30.94 buy point.
Ross Stores (ROST) dipped even though the off-price retailer topped fourth-quarter estimates and announced a $2.1 billion stock buyback. It also raised its quarterly dividend 10%. The stock is off its 52-week high reached on Tuesday and tested its 21-day exponential moving average.
Abercrombie & Fitch (ANF) sank more than 2% even after the apparel retailer exceeded fourth-quarter earnings and sales expectations. Shares have had an incredible run that started around August 2023.
Dow Jones component Apple (APPL) inched 0.2% lower, adding to a five-day sell-off.
Meanwhile, Tesla (TSLA) fell more than 1%, adding to its two-day drop on the stock market today. The electric vehicle giant is having its worst three-day stretch since the three days ending Oct. 20, 2023, when it fell 16.82%, according to Dow Jones.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
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