Stock Market Today: Stocks End Higher But Snap Spirals
The stock market finished the week strong on hopes the streak of aggressive Fed rate hikes will end sooner rather than later.
Stocks closed solidly higher Friday as Wall Street cheered reports the Federal Reserve could consider smaller rate hikes following its November meeting.
An early morning article in The Wall Street Journal suggested some Fed officials have been indicating they support slowing down the pace of rate hikes soon in order to allow what they've done thus far (one 0.25% increase followed by three straight 0.75% raises, and expectations for another 0.75% hike at the Nov. 1-2 meeting) to work. This, along with comments from San Francisco Fed President Mary Daly, who said today that "the time is now to start planning for stepping down," gave stocks enough reason to rally.
A fresh round of well-received corporate results created another tailwind for stocks, with beermaker Boston Beer (SAM, +19.7%) and regional bank Huntington Bancshares (HBAN, +9.5%) among those higher on Q3 beats.
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Not all earnings reactions were positive, though. Snapchat parent Snap (SNAP) plunged 28.1% after reporting its lowest year-over-year revenue growth on record due to slowing ad spending.
At the close, the Dow Jones Industrial Average was up 2.5% at 31,082, the S&P 500 Index was 2.4% higher at 3,752, and the Nasdaq Composite jumped 2.3% to 10,859.
What a Stronger Dollar Means for Stocks
What's in store for next week? A busy earnings calendar loaded with Big Tech results. Among the names set to report are Alphabet (GOOGL), Amazon.com (AMZN) and Apple (AAPL). While earnings from those companies that have posted so far have been generally well received, this next batch could give us a bigger hint at how the stronger dollar impacted corporations in Q3.
"A strong dollar has been a drag for even some unsuspecting companies such as Johnson & Johnson (JNJ), Netflix (NFLX) and Levi's (LEVI), but it will especially be a headwind for multinationals," says Larry Adams, chief investment officer of Raymond James' private client group. "While the degree of the impact depends on the blend of costs versus sales overseas and how much of the currency risk is hedged, a stronger dollar typically impairs earnings." So, what does a stronger dollar mean for investors of these multinational corporations (and others)? Here, we take a closer look.
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