Stock Market Today: Cheerful Consumer Data Gives Stocks a Small Bump

Retail sales in September improved by more than expected and a consumer sentiment reading improved, providing the market with a tiny lift Friday.

(Image credit: Getty Images)

A bevy of positive headlines didn't launch stocks to the moon, but they did at least manage to end losing streaks in a couple of the major indices.

On the COVID-19 vaccine front, Pfizer (PFE (opens in new tab), +3.9%) unveiled a timetable in which it could apply for FDA emergency-use approval by late November. While that's slower than the Election Day timeline touted by President Donald Trump, it still would qualify as extremely rapid development of a successful vaccine.

Economic data provided some hope, too. U.S. retail sales rose 1.9% month-over-month, well above economists' estimates.

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"Despite unemployment benefits expiring for millions of Americans, today's retail sales figure shows us there is still some gas in the tank for the consumer," says Charlie Ripley, senior investment strategist for Allianz Investment Management, though he added it's not all positive. "The overall level of retail sales is well above pre-pandemic levels, however, when you dig deeper into the underlying data, businesses that have been hit the hardest continue to struggle."

Also, a preliminary University of Michigan consumer sentiment reading edged higher, mostly on optimism about conditions improving in 2021.

The Dow Jones Industrial Average didn't gain much, but the 0.4% improvement to 28,606 was enough to snap a three-day losing streak.

Other action in the stock market today:

  • The S&P 500 also snapped a three-day skid, albeit with a whisper-thin half-point gain to 3,483.
  • The Nasdaq Composite closed 0.4% lower to 11,671.
  • The Russell 2000 declined 0.3% to 1,633.

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Stocks are broadly up for 2020 and successfully broke out of bear-market territory in record speed, but the indices are effectively flat since the start of September, mired in political and medical uncertainty.

But remember: That doesn't mean all stocks are flat.

Most portfolios can do with a small allocation toward aggressive plays that shoot higher even when the indices are sluggish. Sports betting stocks, for instance, could be an intriguing play -- they face the risk of more COVID-related shutdowns, but if not, they could leverage record dollars being gambled across several states.

If you're more passionate about politics than sports, you could always invest in stocks that analysts believe will jump depending on who is elected president this November -- here, we look at 10 stocks that would succeed under Joe Biden, and 10 different picks for another four years of President Donald Trump.

And it's hard to beat small-cap technology for pure growth potential. Yes, we mentioned yesterday that Goldman is cooling on the sector in the short-term, but a group of smaller plays are well-positioned in trending technologies for several years' worth of outperformance. Here, we look at seven small-cap tech stocks that have powerful upside potential that's difficult to ignore.

Kyle Woodley
Senior Investing Editor, Kiplinger.com

Kyle is senior investing editor for Kiplinger.com. As a writer and columnist, he also specializes in exchange-traded funds. He joined Kiplinger in September 2017 after spending six years at InvestorPlace.com, where he managed the editorial staff. His work has appeared in several outlets, including U.S. News & World Report and MSN Money, he has appeared as a guest on Fox Business Network and Money Radio, and he has been quoted in MarketWatch, Vice and Univision, among other outlets. He is a proud graduate of The Ohio State University, where he earned a BA in journalism.