Joey Solitro
Stocks jumped out of the gate and stayed there through the close. Today's upside came courtesy of bargain hunters and an encouraging update on the labor market. A round of well-received earnings reports also boosted sentiment.
Market volatility has ramped up over the past week as disappointing economic data reignited recession chatter – and sparked concerns the Federal Reserve waited too long to cut interest rates. Indeed, losses for the main indexes ranged from 5% to 8% between the July 31 and August 7 closes.
Today, though, the Dow Jones Industrial Average gained 1.8% to 39,446, the S&P 500 rose 2.3% to 5,319, and the Nasdaq Composite added 2.9% to 16,660.
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.
In economic news, data from the Department of Labor showed initial jobless claims fell by 17,000 last week to 233,000, more than economists were expecting.
The July jobs report signaled a notable slowdown in hiring last month, so today's report "helps to calm fears about the health of the labor market," says Skyler Weinand, chief investment officer at Regan Capital. "Just because the labor market is cooling off doesn't mean we're entering into a recession."
Palantir builds on weekly gain
In single-stock news, Palantir Technologies (PLTR) had another strong session, surging 11.3% on news the data analytics firm teamed up with Microsoft (MSFT, +1.1%). The partnership will have the two tech companies selling secure cloud, analytics and artificial intelligence (AI) capabilities to the U.S. government.
In its most recent earnings report, Palantir said its government contracts accounted for more than 40% of its total revenue. The print, which was released Monday evening, sent PLTR up 10% in Tuesday's session. And with today's gain, the tech stock is up more than 18% for the week to date.
Weight-loss drugs fuel Q2 beat for Eli Lilly
As for today's earnings news, Eli Lilly (LLY) stock surged 9.5% after the pharmaceutical giant beat top- and bottom-line expectations for its second quarter, driven by demand for its weight-loss drugs. LLY also raised its full-year forecast.
Jefferies analyst Akash Tewari (Buy) says the company's GLP-1 drugs make LLY a "must-own" stock, and that its next-generation combination treatments "could lead to the greatest period of revenue and earnings-per-share growth in pharma history."
Robinhood, Klaviyo gain after earnings
Elsewhere, Robinhood Markets (HOOD) stock gained 3.6% after the online brokerage platform reported record quarterly earnings and revenue results for Q2. But that wasn't all.
"There was a lot to like about HOOD's Q2 including a record $13 billion net deposits," says Mizuho Securities analyst Dan Dolev (Outperform, the equivalent of Buy). "Despite already strong momentum, HOOD is still in its early stages of disrupting the brokerage industry and has plenty of runway from here."
Meanwhile, Klaviyo (KVYO) stock soared 33.4% after the software-as-a-service marketing platform disclosed higher-than-expected top- and bottom-line results for its second quarter and raised its full-year forecast.
Klaviyo's "huge beat … reflects strong execution and growth opportunity," says Mizuho Securities analyst Siti Panigrahi (Outperform). "In the current macro environment, we believe KVYO estimates are derisked for 2024 and 2025 and current levels offer an attractive entry point for KVYO shares."
Related content
- The Fed Is About to Cut Rates. What Should Investors Do?
- The 1031 Exchange Rules You Need to Know
- Kiplinger's Economic Calendar for This Week
-
Wall Street Is Worried About Apple Stock. Should You Be Too?Analysts expect Trump's sweeping tariffs to have an outsized impact on Apple stock. How concerned should investors be?
-
Machine Learning in Finance: Real-World Applications and ChallengesControlling machine learning in a finance environment requires stakeholders' commitment to creating a strong ethical foundation.
-
Wall Street Is Worried About Apple Stock. Should You Be Too?Analysts expect Trump's sweeping tariffs to have an outsized impact on Apple stock. How concerned should investors be?
-
The Stock Market Is Selling Off. Here's What Investors Should DoInvestors are fleeing the equities market en masse in response to the Trump administration's "jaw-dropping" tariffs. But the experts say don't panic.
-
How Building Liquidity Into Your Retirement Plan Can Pay OffTo succeed in investing for retirement, you need time and discipline — liquidity can give you both.
-
Striking Oil in Opportunity Zones: Now Might Be the Best Time to InvestYou could unlock hidden wealth in QOZs with strategic oil and gas investments, potentially combining tax advantages with long-term growth in an essential industry.
-
Stock Market Today: It's the Old Up-Down Again on Liberation DayMarkets look forward to what comes with the reordering of 80-year-old global trade relationships.
-
Can a New Manager Cure Vanguard Health Care Fund?Vanguard Health Care Fund has assets of $40.5 billion but has been ailing in recent years. With a new manager in charge, what's the prognosis?
-
What You Don't Know About Annuities Can Hurt YouLack of awareness leads many to overlook these potent financial tools, and with the possibility of running out of money in retirement, that could really hurt.
-
Three Keys to Logical Investing When Markets Are VolatileFocusing on these market fundamentals can help investors stay grounded rather than being swayed by emotion or market hysteria.
