Stock Market Today: Nasdaq Skyrockets After Meta Earnings, Buyback News
The Dow, on the other hand, closed lower on disappointing guidance from Merck (MRK).
Most stocks jumped out of the gate Thursday, as optimism spilled over from Wednesday's Fed meeting, where the central bank issued its smallest interest rate hike since March 2022.
Solid guidance and big buyback news from Facebook parent Meta Platforms (META) – not to mention one of the best days ever for its stock – gave the risk-on rally some legs. The buying power wasn't widespread, though, as an earnings-induced selloff in drugmaker Merck (MRK) kept the blue-chip Dow Jones Industrial Average in check.
The major benchmarks swung higher late Tuesday after the Federal Reserve raised its benchmark interest rate by 25 basis points (0.25%). This followed a 0.50% hike in December and four straight 0.75% increases prior to that. Meanwhile, Fed Chair Jerome Powell said in a mid-afternoon press conference that the central bank will stay the course in its fight against inflation. Still, markets are actually pricing in rate cuts later this year, according to CME Group.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
On the earnings front, Meta Platforms said fourth-quarter earnings fell 52% year-over-year to $1.76 per share, missing analysts' consensus estimate. Revenue also declined in the three-month period, to $33.7 billion, though this was higher than expected. The company said it expects operating expenses and capital expenditures to be lower this year due to several cost-cutting measures, including layoffs it announced late last year. Meta also unveiled a new $40 billion stock buyback program. In reaction, META stock surged 23.3% – its biggest one-day gain since 2013.
At the close, the Nasdaq Composite was up 3.3% at 12,200, and the S&P 500 was 1.5% higher at 4,179. The Dow, on the other hand, finished down 0.1% at 34,053 as MRK slid 3.3% after the company gave lower-than-expected 2023 guidance due to falling COVID-19 vaccine sales.
The Best Recession-Proof Stocks
Recent stock market price action has been a welcome relief for investors following a turbulent 2022. Still, many market participants remain bearish early on in 2023, according to the results of Morgan Stanley's individual investor pulse survey. The majority of respondents (55%) listed inflation as the top risk to their portfolios, followed by recession risk (49%) and market volatility (44%).
"It's been a challenging market environment as investors navigate through high inflation, geopolitical concerns and recession fears," says Mike Loewengart, head of model portfolio construction at Morgan Stanley. "While these challenges aren't likely to disperse anytime soon, it's important for investors, where appropriate, to remain committed to their plan and consider the diversification of their portfolio. Moving money to the sidelines may sound tempting, but for investors with a lengthier time horizon, staying the course may be beneficial in the long run."
Fortunately for investors, there are solid portfolio choices they can make to help maneuver potential upcoming market challenges. These include choosing the best dividend stocks, as well as the best stocks for rising interest rates. There's also this list of top recession-proof stocks, which include high-quality companies that are well-positioned to traverse an economic downturn.
-
I'm 73 and hate winter, but I can't afford to be a snowbird.How can a snowbird wannabe warm up without the expense? We asked professional wealth planners for advice.
-
5 Smart Things to Do With Your Year-End BonusAfter you indulge your urge to splurge on a treat, consider doing adult things with the extra cash, like paying down debt, but also setting up a "fun fund."
-
Gen X Investors: Protect Your Portfolio From an AI BubbleAmid talk of an AI bubble, what's the best course of action for investors in their 50s and 60s, whose retirement savings are at risk from major market declines?
-
Nasdaq Sinks 418 Points as Tech Chills: Stock Market TodayInvestors, traders and speculators are growing cooler to the AI revolution as winter approaches.
-
Stocks Chop as the Unemployment Rate Jumps: Stock Market TodayNovember job growth was stronger than expected, but sharp losses in October and a rising unemployment rate are worrying market participants.
-
The Delayed November Jobs Report Is Out. Here's What It Means for the Fed and Rate CutsThe November jobs report came in higher than expected, although it still shows plenty of signs of weakness in the labor market.
-
Stocks Struggle Ahead of November Jobs Report: Stock Market TodayOracle and Broadcom continued to fall, while market participants looked ahead to Tuesday's jobs report.
-
AI Stocks Lead Nasdaq's 398-Point Nosedive: Stock Market TodayThe major stock market indexes do not yet reflect the bullish tendencies of sector rotation and broadening participation.
-
Dow Adds 646 Points, Hits New Highs: Stock Market TodayIt was "boom" for the Dow but "bust" for the Nasdaq following a December Fed meeting that was less hawkish than expected.
-
Dow Rises 497 Points on December Rate Cut: Stock Market TodayThe basic questions for market participants and policymakers remain the same after a widely expected Fed rate cut.
-
JPMorgan's Drop Drags on the Dow: Stock Market TodaySmall-cap stocks outperformed Tuesday on expectations that the Fed will cut interest rates on Wednesday.
