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.
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.
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?
-
Stock Market Today: Stocks Stable as Inflation, Tariff Fears EbbConstructive trade war talks and improving consumer expectations are a healthy combination for financial markets.
-
What Trump’s 'Big Beautiful Bill' Means for Your Utility BillsIf passed, the 'Big Beautiful Bill' could make home energy upgrades more expensive and raise monthly costs. Here's how much more you might pay and how to prepare.
-
Stock Market Today: Stocks Stable as Inflation, Tariff Fears Ebb
Constructive trade war talks and improving consumer expectations are a healthy combination for financial markets.
-
Eight Estate Planning Steps to Protect Your Loved Ones (and Your Legacy)Two-thirds of Americans don't have an estate plan. If you're one of them, these are the essential steps to take now to prevent problems for your family later.
-
The Six Pros This Adviser Says You Need to Sell Your BusinessSelling your business isn't as simple as getting the best price and walking away. These are the six professionals you'll need to get a deal across the finish line.
-
The Three C's to Financial Success: A Financial Planner's Guide to Build WealthConsistency, commitment and confidence in your chosen strategy are more critical to your financial success than finding the 'perfect' financial plan.
-
A Financial Adviser's Guide to Solving Your Retirement Puzzle: Five Key PiecesIf retirement's a puzzle you're struggling with, try answering these five questions. The answers will guide you toward a solution.
-
You're Close to Retirement and Cashed Out: How Do You Get Back In?If you've been scared into an all-cash position, it's wise to consider reinvesting your money in the markets. Here's how a financial planner recommends you can get back in the saddle.
-
After the Disaster: An Expert's Guide to Deciding Whether to Rebuild or RelocateHomeowners hit by disaster must weigh the emotional desire to rebuild against the financial realities of insurance coverage, unexpected costs and future risk.
-
A Financial Expert's Tips for Lending Money to Family and FriendsWhat starts as a lifeline can turn into a minefield if the borrower ghosts the lender. Following these three steps can help you avoid family feuds over funds.
