Stock Market Today: Stocks Close Higher After CPI-Fueled Clobbering
The main indexes finished higher Wednesday, regaining some ground lost during Tuesday's selloff.
Stocks opened comfortably higher Wednesday, bouncing back from Tuesday's inflation-fueled selloff. Helping lift sentiment were relatively dovish comments from Chicago Fed President Austan Goolsbee, who said investors shouldn't "get amped up" about one Consumer Price Index (CPI) reading that came in higher than expected.
"If you see inflation go up a little bit that doesn't mean that we're not on the target to get to 2%," Goolsbee said while speaking at the Council of Foreign Relations in New York. "We can still be on the path even if we have some increases and some ups and downs."
All three main indexes tumbled more than 1% Tuesday after a hotter-than-anticipated January CPI report drastically lowered expectations for a Fed rate cut at both the March and May meetings.
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.
Lyft earnings typo sends stock soaring
A round of well-received earnings reports were also in focus today, most notably from Lyft (LYFT). Late Tuesday, the ride-sharing firm disclosed its fourth-quarter results that included higher-than-expected earnings of 18 cents per share on in-line revenue of $1.2 billion. The company also said gross bookings were up 17% year-over-year to $3.7 billion.
In the press release, Lyft initially said it anticipates gross margin to expand roughly 500 basis points – or 5 percentage points – in fiscal 2024. This figure sent shares surging more than 60% in Tuesday's after-hour session.
However, Lyft's Chief Financial Officer Erin Brewer later clarified in the earnings call that this was a clerical mistake and the expectation is actually for gross margin expansion of 50 basis points, or 0.5%.
Still, Lyft "exited 2023 on strong footing with Q4 representing the high watermark for growth in rides, their highest level of annual rides in the company's history and bookings," says Needham analyst Bernie McTernan (Hold). As a result, the stock closed today up 35.1%.
Fellow ride-hailing firm Uber Technologies (UBER) also spiked today. UBER gained 14.7% after the company said its board of directors approved its first-ever stock buyback plan, authorizing up to $7 billion in share repurchases.
Robinhood pops on surprising Q4 profit
Robinhood Markets (HOOD) was another post-earnings winner, surging 13.0% after its results. The online trading platform posted an unexpected profit of 3 cents per share for its fourth quarter. The report also showed revenue surged 24% in the three-month period to a higher-than-expected $455 million.
Crypto trading, in particular, was a "bright spot," with crypto volumes coming in at their strongest since Q3 2022, says Needham analyst John Todaro. However, the analyst remains "Hold rated as we gauge the success of international products which could prove necessary to growing volume longer term."
As for the main indexes, the Nasdaq Composite rose 1.3% to 15,859, the S&P 500 added 1.0% to 5,000, and the Dow Jones Industrial Average gained 0.4% to 38,424.
Related content
- Kiplinger's Earnings Calendar for This Week
- Analysts' Top S&P 500 Stocks to Buy Now
- Is the Stock Market Open on Presidents' Day?
-
Don't Overpay the IRS: 6 Tax Mistakes That Could Be Raising Your BillTax Tips Is your income tax bill bigger than expected? Here's how you should prepare for next year.
-
Flashback Finance: The Cost of Retiring the Year You Were BornJust like groceries, gas and home prices, the cost of retiring is subject to inflation. Here is a look at what it cost to retire in the year you were born.
-
How One Hospital Visit Overseas Could Wreck Your FinancesProper planning can give you peace of mind and protection, regardless of what happens on your trips.
-
Your Guide to Financial Stability as a Military Spouse, Courtesy of a Financial PlannerThese practical resources and benefits can help military spouses with managing a budget, tax and retirement planning, as well as supporting their own career
-
3 Steps to Keep Your Digital Data Safe, Courtesy of a Financial PlannerAs data breaches and cyberattacks increase, it's vital to maintain good data hygiene and reduce your personal information footprint. Find out how.
-
Here's Why You Can Afford to Ignore College Sticker PricesCollege tuition fees can seem prohibitive, but don't let advertised prices stop you from applying. Instead, focus on net costs after grants and scholarships.
-
S&P 500 Tops 7,000, Fed Pauses Rate Cuts: Stock Market TodayInvestors, traders and speculators will probably have to wait until after Jerome Powell steps down for the next Fed rate cut.
-
Today's Senior Living Communities Are Not Your Grandma's 'Old Folks' Home': An Expert Guide to Shopping for the Right FitSenior living facilities have improved and are as diverse as the people who inhabit them. Now, they're more than just a place to go — they're a place to grow.
-
3 Common Misconceptions About Working With a Financial PlannerThink financial planners are only for the wealthy and that AI can replace human advice? Nope. Even people with moderate wealth need professional advice.
-
Should You Consider Investing in the Quantum Computing Sector? This Investment Adviser Has Some SuggestionsInvestors interested in quantum computing could consider ETFs focused on cloud services enabling small businesses to use big technology.
-
S&P 500 Hits New High Before Big Tech Earnings, Fed: Stock Market TodayThe tech-heavy Nasdaq also shone in Tuesday's session, while UnitedHealth dragged on the blue-chip Dow Jones Industrial Average.
