Stocks tumbled Wednesday, weighed down by some downbeat economic data and the stalemate in Congress over additional fiscal stimulus. On the economics front, a report from IHS Markit showed the recovery in U.S. business activity slowed last month, raising fears that the economy is decelerating as it approaches the end of the third quarter. Meanwhile, the impasse in D.C. over a second round of financial help for businesses and the unemployed continued to hurt investor sentiment. The blue-chip Dow Jones Industrial Average finished the session down 1.9%, or 525 points, at 26,763.
Although stocks gave up early gains on Wednesday morning following disappointing business activity data, strategists noted that the landscape wasn't totally bereft of good news. "On the positive side, Nike posted strong fiscal first-quarter earnings, driven by more than 80% growth in digital sales," writes Argus Research. "Johnson & Johnson also announced the start of a Phase 3 trial of its single-dose coronavirus vaccine candidate."
Other action in the stock market today:
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- The Nasdaq Composite lost 3%.
- The S&P 500 fell 2.4%
- The small-cap Russell 2000 declined 2.9%.
- Tesla's (TSLA) long-awaited "Battery Day" landed with a thud. The electric vehicle company touted a cheaper, more efficient battery that would lower car prices, but ultimately the Street responded by selling the news. "Tesla’s battery day was long on vision and boldness, but short on specifics and near term deliverables," wrote Bernstein Research. Shares in TSLA dropped 10.3% to $380.36.
Don't Overlook Growth Stocks with a Value Component
It's no secret that growth stocks have outperformed value stocks over the past decade, and they aren't expected to cool off anytime soon. They sure have proven their worth in 2020. Some long-term investors may be put off by the tendency of growth stocks to have pricier valuations and greater volatility, but there's actually no shortage of growth names that have a value component as well. Check out the stocks most favored by the nation's hedge funds, and you'll see plenty of "growth" names that have rock-solid balance sheets, defensible franchises and even steady dividends. Or have a look at the normally poky telecommunications sector, which can claim ownership of some stocks poised for outsized growth thanks to the build-out of 5G mobile networks. And it shouldn't go unnoticed that Warren Buffett -- an investor who hardly takes untoward risk and loves dividends -- has bought a slew of growth stocks for Berkshire Hathaway's portfolio. Indeed, notwithstanding his recent backing of a blockbuster tech IPO, many of Buffett's favorite growth stocks offer investors a comfortable combination of outperformance, income and safety.
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Dow Adds 314 Points to Thanksgiving Rally: Stock Market TodayInvestors, traders and speculators enjoy the best Thanksgiving Week gains for the major stock market indexes in more than a decade.
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Nasdaq Rises 2.7% as Musk Tweets TSLA Higher: Stock Market TodayMarkets follow through on Friday's reversal rally with even bigger moves on Monday.
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Dow Dives 797 Points as Government Opens: Stock Market TodayThe process of pricing and re-pricing realities old and new never stops, and next week promises to be at least as exciting as this week.
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Stocks Bounce But End With Big Weekly Losses: Stock Market TodayThe stock market rout continued on Friday, but a late-day burst of buying power brought the main indexes off their session lows.
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Elon Musk's $1 Trillion Pay Package Passes: What's at Stake for Tesla StockMore than 75% of Tesla shareholders voted to approve a massive pay package for CEO Elon Musk. Here's what it means for the Mag 7 stock.
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If You'd Put $1,000 Into Home Depot Stock 20 Years Ago, Here's What You'd Have TodayHome Depot stock has been a buy-and-hold banger for truly long-term investors.
