Stock Market Today: Nasdaq Nabs First Record Close Since 2021
While the main indexes were choppy Thursday, tech stocks Snowflake and Okta made major moves.
Stocks opened higher Thursday as Wall Street panned the latest inflation update, which came in not as bad as other recent readings on the same topic. The main indexes lost some steam midday, but managed a quick recovery with the Nasdaq Composite nabbing its first record close since November 2021.
Ahead of the open, the Bureau of Economic Analysis said the Personal Consumption and Expenditures (PCE) price index, the Fed's preferred inflation indicator that measures consumer spending, was up 0.3% from December to January – higher than the previous month's 0.1% rise, but in line with economists' expectations.
The 2.4% annual rise in PCE came in below the 2.6% increase from December and was the lowest reading since February 2021.
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.
Core PCE, which excludes volatile food and energy prices, was higher than December on a monthly basis (0.4% vs 0.1%), but lower year-over-year (2.8% vs 2.9%). Both figures matched what economists were anticipating.
The data also showed that consumer spending cooled in January, rising 0.2% month-over-month vs a 0.7% increase in December. Personal income, meanwhile, jumped 1% in January, much higher than December's 0.3% gain.
Ian Shepherdson, chairman and chief economist at Pantheon Macroeconomics, sees no reason "to change our big picture view that core inflation is falling and will continue to slide, thanks to the pass-through from slowing wage gains, improving supply chains, and margin recompression."
However, Shepherdson notes that the Fed will likely delay the first rate cut until June or beyond given that it's "hyper-cautious" after its incorrect calls in 2021 that elevated inflation would be "transitory," as well as hotter-than-expected Consumer Price Index (CPI) and Producer Price Index (PPI) readings of late.
Indeed, according to CME Group's FedWatch Tool, futures traders are now pricing in a 19% chance that the first quarter-point cut to interest rates will come in May and a 53% probability that it will occur in June.
Snowflake spirals 18% as CEO retires
In single-stock news, Snowflake (SNOW) was one of the worst performers Wednesday, tumbling 18.1% after earnings. There were plenty of good things in the cloud-based data platform's fourth-quarter report, including a 32% year-over-year (YoY) surge in revenue to $774.7 million and a 39% increase in the number of customers with trailing 12-month product revenue of $1 million or more. And for the full year, product revenue hit $2.7 billion, up 38% YoY.
But shares spiraled after Snowflake gave weaker-than-anticipated first-quarter revenue guidance and announced the departure of CEO Frank Slootman. The executive has been in the top spot since 2019 and helped take the company public in 2020. Slootman will be replaced by Sridhar Ramaswamy, a former Google ad exec and current senior vice president of AI at Snowflake.
The tech stock happens to be a member of the Berkshire Hathaway equity portfolio, with Warren Buffett & Co. even having a stake in its initial public offering (IPO) in 2020. SNOW has generated a negative return as a publicly traded company thus far.
Okta gets a double upgrade after earnings
On the other side of the coin was Okta (OKTA), which surged 22.9% after earnings. The cloud-based cybersecurity firm said total revenue rose 19% year-over-year in the fourth quarter thanks to a 20% jump in subscription revenue. Additionally, Okta expects revenue to grow 16% to 17% in the first quarter and 10% to 11% in the current fiscal year.
BofA Securities analyst Madeline Brooks says Okta's full-year guidance is "overly conservative, which could drive upwards estimate revisions throughout the year and warrant positive rerating of the stock." As such, she double-upgraded the tech stock to Buy from Underperform (the equivalent of Sell).
As for the main indexes, the Dow Jones Industrial Average rose 0.1%% to 38,996, while the S&P 500 (+0.5% at 5,096) and the Nasdaq Composite (+0.9% at 16,091) finished at new record closes. All three indexes finished February higher. For the Dow and S&P 500, it was the best start to the year (January + February returns) since 2019.
Related content
- Verizon's Latest Bundle Offers Netflix and AMC Plus for $25.99
- When Is the Next Jobs Report?
- Kiplinger's Earnings Calendar for This Week
-
Countries That Will Pay You to Move: Cash Grants, Incentives and What to KnowExplore real relocation incentives — from cash grants and tax breaks to startup funding — that make moving abroad or to smaller towns more affordable and rewarding.
-
Mortgage Protection Insurance: What It Covers and When It Makes SenseHow mortgage protection insurance works, what it costs, and when it’s actually useful in a financial plan.
-
How to Use Your Health Savings Account in RetirementStrategic saving and investing of HSA funds during your working years can unlock the full potential of these accounts to cover healthcare costs and more in retirement.
-
I'm a Real Estate Expert: 2026 Marks a Seismic Shift in Tax Rules, and Investors Could Reap Millions in RewardsThree major tax strategies will align in 2026, creating unique opportunities for real estate investors to significantly grow their wealth. Here's how it works.
-
When Can Tax Planning Be an Act of Love? This Family Found OutHow can you give stock worth millions to a loved one without giving them a huge capital gains tax bill? This family's financial adviser provided the answer.
-
Forget Job Interviews: Employers Will Find the Best Person for the Job in an Escape Room (This Former CEO Explains Why)Escape rooms can give employers a better indication of job candidates' strengths than a standard interview. Here's how your company can get on board.
-
Visa Stamps the Dow's 398-Point Slide: Stock Market TodayIt's as clear as ever that President Donald Trump and his administration can't (or won't) keep their hands off financial markets.
-
The December CPI Report Is Out. Here's What It Means for the Fed's Next MoveThe December CPI report came in lighter than expected, but housing costs remain an overhang.
-
The Paradox Between Money and Wealth: How Do You Find the Balance?Wealth reflects a life organized around relationships, health, contribution and time — qualities that compound differently than money in a mutual fund.
-
Billed 12 Hours for a Few Seconds of Work: How AI Is Helping Law Firms Overcharge ClientsThe ability of AI to reduce the time required for certain legal tasks is exposing the legal profession's reliance on the billable hour.
-
General Partner Stakes: Why Investors Are Buying Into the Business of Private EquityGP stakes in asset management firms offer exposure to private markets and are no longer just for the wealthy. Find out why it looks like a good year to invest.
