Stocks opened higher Wednesday and kept climbing through the close. In focus were comments from several Federal Reserve officials – many of whom echoed the hawkish tone Fed Chair Jerome Powell has struck recently regarding interest rates.
However, the latest round of corporate earnings reports lifted sentiment, with burrito chain Chipotle Mexican Grill (CMG) among those posting strong results.
There were no fewer than four senior central bank officials making appearances Wednesday, including Fed Governor Adriana Kugler. Speaking at the Brookings Institute in Washington D.C., Kugler said that she's pleased with the progress that's been made so far with bringing inflation down and added that "at some point" it will be appropriate to cut the federal funds rate.
Sign up for Kiplinger’s Free E-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.
Still, she emphasized that "it is critical" inflation returns to the Fed's 2% target and "if progress on disinflation stalls, it may be appropriate to hold the target range steady at its current level for longer."
According to CME Group's FedWatch Tool, futures traders are currently pricing in an 18% chance the Fed will cut rates by a quarter-percentage point in March, down from 53% one week ago. The odds for a May cut are 53%.
Chipotle, Roblox rise after earnings
In single-stock news. Chipotle Mexican Grill rose 7.1% after the burrito chain reported top- and bottom-line beats for its fourth quarter. The company also said same-store sales were up 8.4% for the three-month period, higher than analysts were expecting.
"Same-store sales benefited from higher customer traffic and, to a lesser extent, an increase in the average check," says Argus Research analyst John Staszak.
Roblox (RBLX) was another post-earnings gainer, with the metaverse stock surging 10.3% after its results. In addition to fourth-quarter revenue that was up 30% year-over-year to $749.9 million, bookings jumped 25% to $1.1 billion. Average daily active users and average monthly unique payers were also up by double-digit percentage points.
Snap craters after top-line miss
At the other end of the spectrum was Snap (SNAP), which crumbled 34.6% after earnings. While the Snapchat parent reported higher-than-expected fourth-quarter earnings of 8 cents per share, revenue of $1.36 billion fell short of analysts' estimates. Additionally, the company gave weak first-quarter guidance.
"While Snap may have been spending in the right places, the returns on those investments have been slower to materialize than some would like, and 2023 may be remembered as a lost year for the company, where user growth decelerated and revenues were flat," says Scott Kessler, global sector lead for technology, media and telecommunications at Third Bridge. While Snap seems to have made some progress with its initiatives, today's price action indicates that investors don't want to wait, Kessler adds.
Buffett scoops up more OXY shares
In non-earnings news, Occidental Petroleum (OXY, +0.1%) made headlines after a Tuesday night regulatory filing revealed Warren Buffett's Berkshire Hathaway (BRK.B) bought 4.3 million OXY shares between February 1 and February 5.
Buffett & Co. first started accumulating shares of the energy stock in the first quarter of 2022. At the end of Q3 2023, the holding company owned more than 224 million Occidental shares, accounting for 4.6% of the Berkshire Hathaway equity portfolio. Considering OXY declined 3.6% in January, Buffett was likely buying the dip on one of his favorite oil stocks.
As for the main indexes, the Dow Jones Industrial Average rose 0.4% to 38,677 and the S&P 500 added 0.8% to 4,995, both new record closes. The Nasdaq Composite tacked on 1.0% to 15,756.
Related content
- Does NYCB's Selloff Make Regional Bank Stocks a Buy?
- What to Know About The Recalls at Honda and GM
- How to Find the Best Emerging Market Stocks
-
Stocks Can't Hold Meta, Microsoft Gains: Stock Market TodayThe main indexes all opened higher Thursday on impressive Big Tech earnings, but momentum faded into the close.
-
Retirement Health Care Costs Are On the Rise: What You Need to KnowA 65-year-old retiree will face significantly higher lifetime health care costs than they would have a year ago, even with Medicare. Here are the surprising totals.
-
Stocks Can't Hold Meta, Microsoft Gains: Stock Market Today
The main indexes all opened higher Thursday on impressive Big Tech earnings, but momentum faded into the close.
-
Three Ways to Find Deals in Your Investments This YearLooking for ways to save because of tariffs? Don't forget to look for deals in your investments. Here are three expert tips for making a little extra this year.
-
How to Invest for a Fall Interest Rate Cut by the FedA lot can happen between now and then, but the probability the Fed cuts interest rates before the end of the year is better than 85%.
-
You Don't Have to Be Wealthy to Need a Wealth ManagerNavigating complex financial decisions is hard on your own, no matter how much money you have. A wealth manager can provide comprehensive financial planning, investment management, risk management and more.
-
Despite Tariffs, These Investment Experts Are Bullish on European EquitiesEuropean equities were one of the better-performing investments during the first half of 2025. They could be a good long-term prospect for U.S. investors needing to diversify, according to these investment managers.
-
Stocks Are Up and Down on Fed Day: Stock Market TodayIn another sign of changing times, JPMorgan has partnered with Coinbase to enable cryptocurrency purchases with credit cards.
-
What Federal Interest Rates Mean for Your Grocery BillThe relationship between grocery prices and the Federal Reserve has plenty of back-and-forth. Understand how they interplay.
-
5 Undervalued Stocks to Buy NowThere are plenty of high-quality undervalued stocks to buy right now, you just need to know where to look. Here, we highlight five of our top picks.
