Stock Market Today

Stock Market Today: Dour Disney Results Drag Down the Dow

Technology stocks enjoyed a relief rally Thursday amid the bond market's off day, but the Dow couldn't escape the effects of a weak Disney report.

The stock market was indeed open for Veterans Day, but perhaps just as importantly, the bond market was closed, allowing technology-sector equities and other rate-sensitive shares to catch their breath after Wednesday's downturn.

Unfortunately, a steep drop in Disney (DIS, -7.1%) on Thursday prevented the Dow Jones Industrial Average from ending its recent slide.

An otherwise light news day put the spotlight back on corporate earnings, which triggered several precipitous declines. Dating app creator Bumble (BMBL, -19.3%) announced its first quarter-over-quarter decline (2%) in user growth and missed earnings estimates, while Beyond Meat (BYND, -13.3%) tumbled after delivering weak Q3 results and a disappointing Q4 outlook.

The highest-profile miss, however, came from Disney, which fell short of expectations not just for the top and bottom lines, but also its number of Disney+ subscribers. That prompted a number of price-target downgrades, though analysts largely remained bullish on Disney's longer-term potential.

"We believe DIS's asset mix of both digital and physical assets maximizes its economic value capture over time … [but] DIS's FY4Q21 comments (our view) implied that share price catalysts won't begin until 2022's June quarter," says Needham analyst Laura Martin, who has a Hold rating on shares.

Sign up for Kiplinger's FREE Investing Weekly e-letter for stock, ETF and mutual fund recommendations, and other investing advice.

Disney's loss weighed on the Dow (-0.4% to 35,921), which suffered its third consecutive loss. But the S&P 500 (up marginally to 4,649) and Nasdaq Composite (+0.5% to 15,704) snapped their short skids thanks to rebounds in chipmakers such as Advanced Micro Devices (AMD, +4.4%) and Qualcomm (QCOM, +2.9%), as well as streaming stock Netflix (NFLX, +1.7%).

stock chart for 111121

YCharts

Other news in the stock market today:

  • The small-cap Russell 2000 rebounded 0.8% to 2,409.
  • U.S. crude futures were virtually flat, declining a mere 2 cents per share to $81.32 per barrel.
  • Gold futures improved again, up 0.8% to $1,863.90 per ounce. Spot gold prices, meanwhile, neared five-month highs.
  • The CBOE Volatility Index (VIX) lost all of the ground it gained Wednesday and then some, declining 5.4% to 17.72.
  • Bitcoin declined again, by 1.2% to $64,820.64. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)
  • Electric vehicle makers Lordstown Motors (RIDE, +23.9%) and Fisker (FSR, +10.9%) were both up big Thursday, but for different reasons. The former jumped after Foxconn agreed to buy its Lordstown, Ohio, plant for $230 million. The Chinese electronics manufacturer also said it would seek a deal to help RIDE make its Endurance line of pickup trucks. And the latter a price-target upgrade, to $24 per share from $18, from BofA Securities analyst John Murphy. Murphy nonetheless maintained his Neutral stance on FSR.

Tesla's Tiny Loss: A Win for You?

One of the more important moves of the day was, in fact, practically a non-move. Electric vehicle maker Tesla (TSLA, -0.4%) finished Thursday with a modest loss.

However, that's a welcome stabilization in shares after a highly telegraphed stock sale by CEO Elon Musk sent TSLA shares plunging by as much as 19% between last Friday's close and yesterday's intraday lows.

It's clearly fantastic news for Tesla's shareholders, but it's still meaningful even if you don't hold the stock.

That's because TSLA is one of several mega-cap stocks that have an outsized amount of influence on major funds, representing 2% of the S&P 500, 4.5% of the popular Nasdaq-100 index, and roughly 19% of the market's largest consumer-discretionary ETF. This puts Tesla in company with the "FAANGs" – or the "FANGs," or the "FAAMGs," or whatever acronym comes next to encapsulate Wall Street's largest companies such as Apple (AAPL) and Microsoft (MSFT).

Tesla also is similar to several of the FAANGs in that its popularity has also led to a bloated valuation. Fortunately, there's more than one way to invest in these ubiquitous companies. We've recently put our microscope not just on the FAANGs and other mega-caps themselves, but companies that provide products and services to these behemoths, offering something of a backdoor way to share in the growth of these trillion-dollar firms.

Here are seven other ways to invest in the FAANGs.

Kyle Woodley was long AMD and TSLA as of this writing.

Most Popular

Don’t Be Tricked Into Voluntarily Paying Higher Taxes on Your IRA
IRAs

Don’t Be Tricked Into Voluntarily Paying Higher Taxes on Your IRA

Traditional IRAs are set up in a way that basically incentivizes you (and your heirs) into paying the highest tax bill possible. Don’t fall for it. Co…
July 4, 2022
Your Guide to Roth Conversions
Special Report
Tax Breaks

Your Guide to Roth Conversions

A Kiplinger Special Report
February 25, 2021
Retirees, Make These Midyear Moves to Cut Next Year's Tax Bill
Tax Breaks

Retirees, Make These Midyear Moves to Cut Next Year's Tax Bill

Save money next April by making these six hot-as-July tax moves.
July 1, 2022

Recommended

Stock Market Today (7/5/22): Energy Dampens Dow, FAANGs Elevate Nasdaq
Stock Market Today

Stock Market Today (7/5/22): Energy Dampens Dow, FAANGs Elevate Nasdaq

Recessionary fears weighed on oil and economically sensitive sectors Tuesday, while declining Treasury yields lifted tech-esque stocks.
July 5, 2022
Stock Market Today (7/1/22): Stocks Catch a Second Wind to Start Second Half
Stock Market Today

Stock Market Today (7/1/22): Stocks Catch a Second Wind to Start Second Half

Despite a dour ISM manufacturing index reading Friday, stocks broadly managed to pull themselves together and finish well in the black.
July 1, 2022
Stock Market Today (6/30/22): S&P Suffers Worst First Half Since 1970
Stock Market Today

Stock Market Today (6/30/22): S&P Suffers Worst First Half Since 1970

The major indexes produced a familiar result Thursday, finishing in the red to close out a dreary first six months of the year.
June 30, 2022
Can AI Beat the Market? 10 Stocks to Watch
stocks

Can AI Beat the Market? 10 Stocks to Watch

An artificial intelligence (AI) system identifying high-potential equities has been sharp in the past. Here are its 10 top stocks to watch over the ne…
June 30, 2022