The Dow jumped almost 500 points Wednesday, but the Nasdaq’s tech stars shown bright, and the index rose more than 2.5%
US stocks rallied on Wednesday as company news drove the market’s trajectory, easing concerns, at least for the day, after the bond market and worry about US House Speaker Nancy Pelosi’s trip to Taiwan spooked them in the previous session.
Q2 2022 hedge fund letters, conferences and more
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TheDow Jones Industrial Average rose 1.5% or almost 500 points. The S&P 500 index jumped 1.6%, and the Nasdaq composite Index was Wednesday's star, adding 2.6%.
PayPal (NASDAQ:PYPL) shares rose 9.2% to $97.92 after aggressive activist fund Elliott Management confirmed a stake in the company, promoting investor buying, based in no small part on the fund's track record of forcing change that favors shareholders.
Interestingly, Elliott also confirmed it owns a stake in creator website Pinterest (NYSE:PINS).
Viewing the two positions in context may give new impetus to Elliott Partner Jesse Cohn's comment this week that PayPal, "As the market-leading platform at the intersection of social media, search and commerce occupies a unique position in the advertising and shopping ecosystems."
Denny's (NASDAQ:DENN) is killing longtime staples of its value offering menu, including its endless breakfast and a $6.99 pancake special. Another sign of inflation's effects on the consumer is that Denny's said it is cutting deals despite higher sales. The company said the marketing campaign is "at the end of its useful life." Its shares rose 6.7% to $10.11.
Robinhood Markets (NASDAQ:HOOD) shares jumped 11.7% to $10.31 after the company said it's firing 23% of its staff as retail investors it lured into the market during the pandemic with gamelike transaction software and a steady stream of bells and whistles are leaving in droves.
"Last year, we staffed many of our operations functions under the assumption that the heightened retail engagement we had been seeing with the stock and crypto markets in the COVID era would persist into 2022," said Chief Executive Officer Vlad Tenev. "In this new environment, we operate with more staffing than appropriate. As CEO, I approved and took responsibility for our ambitious staffing trajectory -- this is on me."
Dish Network also reported some customer slowdown on Wednesday and said its subscriber base shrank by a quarter million in the second quarter, falling below the psychologically important 10 million. Dish shares rose 6.3% on Wednesday,
The Institute of Supply Management published its services data Wednesday, showing a 56.7 reading, a big jump from June's 55.3 in June.
The high reading would not typically support a recessionary view; instead, according to some economists implies two percent annual economic growth.
Small cap stock investors are feeling cheery. The bank said Wednesday that more than 70% of the companies in RBC's universe of smaller, domestically focused firms are top and bottom line analyst expectations. These firms benefit from a strong US economy and remain more isolated from currency and other international risks.
A billreleased Wednesday and making its way through Congress would make Coinbase (NASDAQ:COIN),FTX and othersregister with the CFTC and improve consumer protection and market monitoring.
Coinbase shares rose 20% to $80.81.
Tesla hosts its 2022 annual meeting Thursday, starting at 5:30 p.m. ET, and can be watched on its website. Watch for questions from shareholders to run the gamut from its electric vehicles and crypto to chief executive Elon Musk's food fight with Twitter (NYSE:TWTR). Tesla added more than two percent.
Dividend investors have a new investment consideration. Murphy Oil (NYSE:MUR) raised its dividend 43% on Wednesday, to 25 cents a share from 17.5 cents, for a roughly three percent yield. That pulls it closer to the SPDR Energy Select Sector ETF's (NYSEARCA:XLE)3.73% yield.
But, falling crude prices weighed on energy stocks more broadly, and Murphy shed 6.1%.
Article by Greg Morcroft, Fintel
