Stock Market Today Mid-Morning Updates
On Thursday, the Dow Jones Industrial Average is up by 20 points. This comes after continued momentum towards record highs seen across indices at the start of the year. However, investors are looking at tighter Federal Reserve policy and interest rate hikes around the corner. Tech stocks, in particular, are experiencing renewed pressure amid interest rate worries. As a result, the Nasdaq is down by 3.1% on Wednesday. Companies like Nvidia (NASDAQ: NVDA) were down by over 4% yesterday.
However, there are some outliers from the tech space like Coinbase (NASDAQ: COIN). The company received an upgrade to Buy from Neutral by Bank of America (NYSE: BAC). Analyst Jason Kupferberg says that the crypto exchange’s revenue is diversifying beyond retail crypto trading and thinks that it is a trend that could accelerate in the years ahead. In other news, top U.S. infectious disease expert Anthony Fauci warned against complacency about the Omicron variant as it continues to strain hospitals around the country. Daily Covid cases in the U.S. reached over 1 million this week.
Among the Dow Jones leaders, shares of Apple (NASDAQ: AAPL) are down by 0.26% on Thursday while Microsoft (NASDAQ: MSFT) is also down 0.18%. Home Depot (NYSE: HD) and Nike (NYSE: NKE) are also down 0.45% and 0.36% respectively today.
Shares of electric vehicle (EV) leader Tesla (NASDAQ: TSLA) are down by 0.63% on Thursday. Rival EV companies like Rivian (NASDAQ: RIVN) are up 1.84% today while Lucid Group (NASDAQ: LCID) is down by 1.47%. Chinese EV leaders like Li Auto (NASDAQ: LI) and Xpeng Motors (NYSE: XPEV) are trading higher today.
Dow Jones Today: Fed Minutes & Treasury Yields
Following the stock market opening on Thursday, the S&P 500, Dow Jones, and Nasdaq are trading 0.34%, 0.08%, and 0.36% higher respectively. Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (NASDAQ: QQQ) ticked higher by 0.36% Thursday, while the SPDR S&P 500 ETF (NYSEARCA: SPY) is also up by 0.41%.
The 10-year Treasury yield edged higher near 1.74% Thursday morning. This came after the Federal Reserve signaled the possibility of faster-than-expected interest rate hikes and stimulus withdrawal.
Minutes from the Fed’s December meeting had shown that a tight jobs market and persistent inflation could require the U.S. central bank to raise rates sooner than expected. Officials also discussed the shrinking of its overall asset holding, also known as quantitative tightening. This could be the clearest indication that officials are ready to aggressively dial back policy help.
In detail, the minutes signaled an apparent consensus that $4.5 trillion in Covid-era asset purchases unwind at a rate of more than $50 billion per month. The hawkish signal from the Fed could fuel further bets on higher yields and continue to put pressure on growth stocks and tech stocks that powered the rally in the stock market last year.
Officials at the meeting also indicated that inflation gauges is now higher and more persistent than previously anticipated. While members said that growth will be robust in 2022, they also cautioned that inflation will pose a strong risk, perhaps even more so than the pandemic.
Jobless Claims Higher Than Expected Amid Surge In Omicron Cases
The Labor Department reported that initial jobless claims totaled 207,000, while economists surveyed by Dow Jones projected 195,000. The newest prints bring the four-week moving average to 204,500 for the current period. Even though the jobless claims are a bit higher than the forecasted number, the latest figure is still well below the pre-pandemic level.
Continuing claims, which ran a week behind the headline number, also increased slightly by 36,000 to reach a total of 1.75 million. With the new claims for unemployment benefits hovering near decades-low levels, the latest data is still highly positive for an economy that’s battered by the ongoing pandemic.
BBBY Stock Surging Today Despite Less-Than-Ideal Quarterly Results
Bed Bath & Beyond (NYSE: BBBY) seems to be among the most active stocks in the stock market today. At face value the current activity in the company’s shares makes sense. After all, it posted its latest quarterly earnings figures earlier today before the opening bell. However, BBBY’s latest numbers are lackluster for the most part. The company fell short of consensus estimates across the board. It posted a loss per share of $0.25 on revenue of $1.88 billion. For reference, Wall Street was expecting it to break even in terms of earnings while raking in a revenue of $1.95 billion. All this alongside supply chain strains costing BBBY up to $100 million explains why the retailer cut its financial outlook for the year.
Now, this is where things get interesting. After an initial nosedive of 9% in early premarket trading, the company’s shares are now up by a whopping 9.61% at today’s opening bell. According to data from CNBC, the company’s shares have been trading in heavy volume; over 4.3 million shares were being traded in today’s pre-market session. This is versus an average 10-day trading volume of 5.5 million shares. If anything, it is important to note that BBBY does have a history in the meme stock trade. As such, most may be looking towards the ongoing battle between short-sellers and retail investors to understand what’s going with BBBY stock now.
Walgreens Earnings Soar On Increasingly Relevant Covid-Related Services; Raises Forecast For Fiscal Year
At the same time, Walgreen Boots Alliance (NASDAQ: WBA) also posted its earnings before today’s opening bell. Alternatively, the company posted solid figures across the board in its first-quarter earnings call. In it, Walgreens reported an earnings per share of $1.68 on revenue of $33.9 billion for the quarter. To compare, consensus estimates were at $1.33 and $32.74 billion respectively. By and large, the company attributes its current performance to a growing demand for its Covid-based offerings.
Firstly, this includes its vaccine administration services that continue to expand towards larger audiences. In essence, this is due to additional approvals for booster shots and first-time vaccinations for children. To put things into perspective, Walgreens administered a whopping 15.6 million Covid vaccines throughout the quarter. This adds up to over 56 million to date. Not to mention, the company’s digital sales also skyrocketed by 88% year-over-year. Overall, it seems like Walgreens is firing on all cylinders now. Despite all of this, WBA stock is trading lower by 0.61% as of today’s opening bell. Could investors be overlooking it amidst all the activity in the stock market today?
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