Stocks fell in light trading on Wednesday as investors took some risk off the table following big November gains.
The S&P 500 shed 0.38% to 5,998.74, snapping a seven-day winning streak. The Nasdaq Composite lost 0.6% to end at 19,060.48. The Dow Jones Industrial Average slipped 138.25 points, or 0.31%, to finish at 44,722.06, reversing course after trading up more than 140 points at session highs.
Traders appeared to take profits on big technology names that have largely performed well this year, which can explain the Nasdaq's underperformance. Nvidia, which has surged more than 173% in 2024, lost more than 1% in the session. Meta Platforms slid 0.8% despite rallying around 60% this year.
Elsewhere in tech, Dell and HP dropped more than 12% and 11%, respectively, after providing weak earnings guidance.
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Those moves followed the latest reading of the personal consumption expenditures price index, or PCE, released Wednesday morning. The Federal Reserve-favored inflation gauge rose 0.2% in October and 2.3% on an annualized basis, in line with expectations from economists polled by Dow Jones. Excluding food and energy, the so-called core measure increased 0.3% month over month and 2.8% compared with a year ago, also matching consensus forecasts.
"Today's data shouldn't change views of the likely path for disinflation, however bumpy," said David Alcaly, lead macroeconomic strategist at Lazard Asset Management. "But a lot of observers, probably including some at the Fed, are looking for reasons to get more hawkish on the outlook given the potential for inflationary policy change like new tariffs."
It is a shortened trading week in the U.S., with the market dark for the Thanksgiving holiday on Thursday and set to close early Friday. Trading volume on the New York Stock Exchange was about a fifth lower than a typical day.
Money Report
Still, it has been a notable week as the Dow and S&P 500 rose to all-time highs. The Dow is now tracking to end the week around 1% higher, while the S&P 500 and the Nasdaq Composite are up about 0.5% and 0.3%, respectively, on the week.
November trading, which has been defined by a postelection rally on the back of President-elect Donald Trump's victory, also concludes this week. The Dow has climbed more than 7% in November, on track for its biggest monthly gain of 2024. The S&P 500 and Nasdaq have each jumped more than 5%.
Stocks finish Wednesday lower
Stocks concluded Wednesday's session in the red.
The Dow and S&P 500 lost 0.3% and 0.4%, respectively. The Nasdaq Composite slid 0.6%.
— Alex Harring
Inflation data is a 'nice Black Friday gift for the Fed,' investment strategist says
Wednesday's inflation data that came in line with expectations is a welcome preholiday update for the Federal Reserve, according to Scott Helfstein, Global X's head of investment strategy.
"This is a nice Black Friday gift for the Fed," he said. "They can eat turkey and watch football for a day knowing that they are close to full employment with price stability."
Helfstein said the numbers are "very close" to the Fed's target goal. Additionally, he said the reading is unlikely to change the path of interest rates, or the probability of a 25 basis-point cut at the central bank's December policy meeting.
— Alex Harring
As shoppers brace for Black Friday, Adobe says early November sales trending above forecast
Holiday shopping is off to a brisk start, according to Adobe Analytics. From Nov. 1 to Nov. 24, the firm measured a 9.6% year-over-year gain in sales on the e-commerce sites it tracks. This means spending is on trend to outpace its 8.4% forecast for the full November to December holiday season.
One factor driving sales is consumers are trading up to pricier products such as larger TVs and more advanced washing machines, the firm said. This shift was observed in categories from electronics and personal care to toys, sporting goods, appliances and tools, Adobe said. This could be one reason electronics sales are up 11.4% during the first 24 days of the month versus the same period in 2023.
For more bargain-hungry consumers, the best is yet to come, according to Adobe. The firm's research suggests the deepest price cuts for televisions will happen on Black Friday, the best deals for computers will occur on Saturday and the biggest markdown for apparel will take place on Cyber Monday.
Adobe's forecast calls for online spending to rise 7% to $40.6 billion during Cyber Week, the five-day period beginning on Thanksgiving, compared with a year ago.
— Christina Cheddar Berk
Number of S&P 500 stocks above 200-day average for past year shows 'solid' market
The percentage of all stocks in the S&P 500 above their 200-day moving averages is currently 77%, and has remained above at least 60% for the past year. This proves that the underpinnings of the market are "still solid," according to Chris Verrone, head of the technical and macro research at Strategas.
The strong moving averages, which smooth out short-term fluctuations to show the underlying trend in a stock price, "speaks to the persistence of decent internals," Verrone wrote to clients on Wednesday.
"It's not historically uncommon for the early part of December to be a shoulder period for stocks, but the market is still smack in the middle of its best 3-month run of the calendar," he said, referring to the period from Oct. 31 until Jan. 31.
— Scott Schnipper
S&P 500 on pace to snap 7-day win streak
With just about an hour left in Wednesday's session, the S&P 500 was poised to end a rally that has lasted over the past seven trading days.
The broad index ticked down about 0.3% in afternoon trading. If that holds, it will mark its first negative and worst trading day since Nov. 15. In that session, the S&P 500 tumbled more than 1.3%.
Elsewhere, the Nasdaq Composite was on track to finish Wednesday around 0.6% lower, while the Dow was down 0.2%.
— Alex Harring
Urban Outfitters on track for best day since 2020
Shares of Urban Outfitters jumped more than 19% in afternoon trading following the retailer's better-than-expected earnings and revenue for the third quarter. Those gains put the stock on pace for its best day since Aug. 26, 2020, when it rose about 21.4%.
Looking ahead, executives revealed in an earnings call with analysts that the company is "optimistic" about demand for the entirety of the upcoming holiday season, with CEO Richard Hayne saying the consumer has been "remarkably resilient."
The stock has also seen substantial gains this year, rising around 34% year to date and around 36% over the past month.
— Sean Conlon
Information technology drops nearly 2%, weighs on S&P 500
Information technology was the worst-performing sector in the S&P 500 on Wednesday, slumping close to 2%.
HP and Dell were the biggest laggards in the sector, shedding more than 12% each. Autodesk tanked more than 8%, while CrowdStrike fell more than 6%. Nvidia, Salesforce, Oracle and Intel declined more than 3% each.
Consumer discretionary was the second-worst performing sector, dropping 0.8%. Industrials and communication services both dipped about 0.2% each.
Real estate, on the other hand, was the best-performing sector, adding 0.9%. CoStar and Mid-America Apartment Communities were the biggest gainers, rising 2% each.
— Samantha Subin
Solar stocks broadly positive as SolarEdge slashes costs
Solar power stocks were broadly positive Wednesday after SolarEdge announced it is shutting down its energy storage business in effort to cut costs.
SolarEdge jumped more than 16%, leading the sector higher in the wake of the announcement. The benchmark Invesco Solar ETF (TAN) rose 1.6% and is up more than 5% for the week.
Enphase gained more than 2%, while Sunnova rose nearly 2% and Sunrun was trading about 1% higher. First Solar, on the other hand, dipped slightly.
Solar stocks have taken a beating since Republicans won unified control of the federal government, raising fears among investors that key tax benefits under the Inflation Reduction Act could be repealed or weakened.
Reps. John Moolenaar, R-Mich., and Jared Golden, D-Maine, introduced legislation last week to block implementation of the 45X production tax credit, arguing it would benefit Chinese companies.
— Spencer Kimball
Dollar poised to snap 8-week win streak
The dollar index, which tracks the U.S. greenback against a basket of foreign currencies, is on track to break a weekly win streak.
The index has dropped more than 1% so far this week. If that holds, it will mark the gauge's first negative week of the last nine.
— Alex Harring, Gina Francolla
Stocks making the biggest moves midday
Check out some of the companies making headlines in midday trading:
- Nordstrom — The retail stock fell 10% after CEO Erik Nordstrom said the company has seen a slowdown in sales, starting in late October. Nordstrom's third-quarter revenue of $3.46 billion did come in above the $3.35 billion LSEG consensus.
- HP — Shares of the PC maker shed 13% and headed for their worst session since 2020 on weaker-than-expected earnings guidance. HP said it expects earnings, excluding items, to range between 70 cents per share and 76 cents per share, versus a FactSet estimate of 85 cents per share.
- Urban Outfitters — The stock jumped 14% after the retailer reported adjusted earnings of $1.10 per share for the third quarter, topping the 86 cents expected by analysts polled by LSEG. Revenue also beat expectations, coming in at $1.35 billion versus the $1.34 billion consensus estimate.
The full list can be found here.
— Hakyung Kim
Dow, Russell 2000 poised for best months of 2024
Two closely followed indexes are on track to notch their best monthly performances this year.
The blue-chip Dow has gained more than 7% so far this month. If that holds, it will mark the biggest monthly gain since November 2023, when it jumped 8.8%.
The small cap-focused Russell 2000, meanwhile, has surged 10.4% in November. That would mark the index's best month going back to December 2023, when it finished just over 12% higher.
— Alex Harring
Materials stocks are a tale of at least two cities, Wall Street says
Materials stocks — makers of steel and copper, cement and paper, packaging and fertilizer — have "failed to catch a bid or see any meaningful upside post election," Rob Ginsberg at Wolfe Research wrote to clients Wednesday, noting that the group is unchanged over the past three months and ahead just 2% since April.
But two sub-sectors within the group stand out, Wolfe said: paper and forest products, "which sits at new highs," partly due to strength in Louisiana-Pacific Corp., ahead 70% year to date; and Sylvamo Corp., up 94% in 2024; and containers and packaging, owing to AptarGroup, 40%; Smurfit WestRock Plc, 38%; and Packaging Corp. of America, 53%.
Metals and mining stocks are vulnerable, however, after failing to break through resistance levels in October and rolling over since then, with Wolfe highlighting advanced alloy maker ATI Inc. as a stock that is likely to continue to weaken.
Separately, Martin Marietta Materials, up 20% year to date, was upgraded to overweight from neutral Wednesday at JPMorgan, which bumped its 12-month price target 24% to $640, from $515. Next year's revenue will increase more than 10%, EBITDA will grow 14% and profit margins will widen to 32.7%, the bank said, explaining its 4% rise in 2025 earnings estimates. "The company appears to have so far been slightly more aggressive than peers on pricing, so upside risks could be lower," analyst Adrian Huerta wrote.
— Scott Schnipper
Nvidia slumps 3%, chip stocks decline
Nvidia dropped 3% during morning trading, putting the most significant pressure on both the S&P 500 and tech-heavy Nasdaq Composite.
Other chipmaking stocks declined alongside, with Broadcom and Micron Technology last down nearly 4% each. Advanced Micro Devices, Taiwan Semiconductor Manufacturing and Intel lost about 3% each, while Marvell Technology shed 4.5%.
The VanEck Semiconductor ETF dropped more than 2%.
— Samantha Subin
HP heads for worst day in more than four years
HP sank 10% during Wednesday's session, putting shares on pace for their worst day since May 2020.
The losses came after the personal computer maker issued disappointing earnings guidance for the current quarter. HP said it expects earnings, excluding items, to range between 70 cents per share and 76 cents per share, versus a FactSet estimate of 85 cents per share.
That came despite better-than-expected fiscal fourth-quarter revenue and in-line earnings.
— Samantha Subin
Inflation data matches expectations
The personal consumption expenditures price index, a broad measure that the Fed prefers as its inflation gauge, increased 0.2% in October and showed a 12-month inflation rate of 2.3%. Both were in line with the Dow Jones consensus forecast.
Excluding food and energy, core inflation increased 0.3% on a monthly basis for an annual reading of 2.8%. Both also met economists' expectations.
— Jeff Cox
S&P 500 opens slightly lower
The S&P 500 kicked off Wednesday's session modestly lower as traders awaited key inflation data.
The broad index slid 0.2% shortly after 9:30 a.m. ET, while the Nasdaq Composite shed 0.3%. The Dow ticked 0.1% higher.
— Alex Harring
Bank of America hikes price target on DataDog
Software company DataDog still has plenty of room to grow and boost its stock price, according to Bank of America.
Analyst Koji Ikeda hiked the price target on the stock to $175 per share from $156.
"Over the years, we've heard many software companies introduce new products to lots of fanfare that end up fizzling out. This is not the case with DataDog," Ikeda said in a note to clients.
The analyst praised the company's core offerings around observability, as well as newer products and potential growth related to artificial intelligence.
"If DataDog is anywhere near close to being as successful with its portfolio of 23 offerings as it has been with the three core pillars of observability, we are only at the beginning of the DataDog story," added Ikeda, who has a buy rating on the stock.
The new price target is 13% above where the stock closed Tuesday. The stock is already up 27% year to date.
— Jesse Pound
U.S. weekly jobless claims fall by 2,000
Initial U.S. jobless claims fell by 2,000 to 213,000 for the week that ended Nov. 23, a sign the U.S. labor market remains tight. Economists polled by Dow Jones expected claims to come in at 215,000.
Continuing jobless claims for the week that ended Nov. 16 increased by 9,000 to 1.907 million, the Labor Department said.
— Fred Imbert
Dell Technologies, Urban Outfitters among the stocks making moves before the bell
Check out the names that are making big moves in the premarket:
- Dell Technologies — Shares fell more than 12% after the PC maker said it sees fourth-quarter revenue and earnings below Wall Street expectations. However, the company gave bullish commentary on artificial intelligence sales growth.
- Urban Outfitters — Shares popped nearly 12% after the retailer reported an earnings and revenue beat postmarket Tuesday. Its adjusted earnings were $1.10 per share, topping the 86 cents expected from analysts polled by LSEG. Revenue came in at $1.35 billion versus the $1.34 billion consensus estimate.
- CrowdStrike — The cybersecurity stock slipped 4% after cautious guidance from the company. CrowdStrike said it expects between 84 cents and 86 cents in earnings per share in the fourth quarter, while analysts surveyed by LSEG had penciled in 86 cents. CEO George Kurtz said on an analyst call that the company expects an acceleration in net new annual recurring revenue in the back half of 2025, which may be further away than some investors were expecting.
Read the full list here.
— Sean Conlon
Loop says investors can 'hide' in these retailers until tariffs become clearer
Despite expectations of a rosy holiday shopping season, investors in retail stocks may want to take some cover amid the uncertainty of new tariffs.
The U.S. macroeconomic backdrop, including the strong labor market, rising consumer prices and falling gasoline costs, provide a healthy tailwind for retailers this holiday season, Loop Capital analyst Anthony Chukumba said in a note Wednesday.
"That said, we believe President-elect Trump's continued fixation on tariffs provides a substantial overhang to the retail industry," he wrote.
Trump said Monday he plans to raise tariffs on all Chinese goods coming into the U.S. by an additional 10%. He also wants to place a 25% levy on all products from Canada and Mexico.
"We believe retailers with as little international sourcing as possible — including Dollar General, Grocery Outlet, and Savers Value Village — may be a good place for investors to 'hide' until the tariff picture becomes clearer," Chukumba said.
— Michelle Fox
Citi upgrades Urban Outfitters to buy
Citi liked what it saw from Urban Outfitters' latest earnings report.
The bank upgraded the retailer to buy from neutral. Analyst Paul Lejuez also raised his price target on the stock to $59 from $42, implying upside of 47% from Tuesday's close.
Urban Outfitters on Tuesday posted third-quarter earnings and revenue that beat analyst expectations. The company also issued strong fourth-quarter guidance.
"While 3Q comps of -9% were weak overall, there were several signs that the brand is moving in the right direction. Profitability improved for the first time in many qtrs, comps/traffic improved sequentially throughout 3Q and exited the qtr in better shape, driving mgmt to guide to a 4Q comp improvement to -MSD with stronger margins (vs LY)," the analyst wrote. "Momentum in key categories, including denim, accessories, home and lounge are driving the comp improvement into holiday with more broad-based improvements expected in the assortment in spring '25 as the brand refocuses on their core 16-28 yr old demo."
— Fred Imbert
European markets subdued as traders assess the tariff threat
European markets traded lower Wednesday as investors continued to assess the potential effect of President-elect Donald Trump's plans to hike tariffs.
The pan-European Stoxx 600 index was 0.2% lower by mid-morning, with most sectors in negative territory.
Shares of EasyJet were up 1.5% after the budget airline posted a 25% rise in full-year operating profit, but shares of Aston Martin were down 4% after the luxury carmaker issued another profit warning. Shares of Just Eat Takeaway fell 1% after the company announced it would delist from the London Stock Exchange.
Global markets have traded mixed since Trump said Monday that one of his first acts in office would be to impose an additional 10% tariff on all Chinese goods entering the U.S., and threatened a 25% tariff on products from Mexico and Canada, ending a regional free trade agreement.
— Holly Ellyatt
Small-cap benchmark takes a breather but remains on track for big November gains
It was a less-than-stellar session for the Russell 2000, as it clipped a six-day winning run on Tuesday.
The small-cap index lagged the three major averages, slumping about 0.7%, while the S&P 500 and the Dow Jones Industrial Average rose to fresh record closes.
Nevertheless, the Russell 2000 is enjoying a strong November, as investors have snapped up cyclical stocks since Donald Trump won a second term in the White House earlier this month.
The Russell is on track for a 10.4% jump month to date, besting the 5.5% gain the S&P 500 is carrying this month. The small-cap benchmark has also topped the Nasdaq Composite's nearly 6% advance in November and the Dow's 7.4% jump.
— Darla Mercado, Chris Hayes
Dell Technologies, Workday among the names making moves in overnight trading
Some stocks are making big moves in extended trading:
- Dell Technologies — The stock tumbled more than 10% on the heels of the company posting weaker-than-expected revenue for the fiscal third quarter. Dell posted $24.37 billion for the period, which is lower than the $24.67 billion analysts had penciled in, according to LSEG. Adjusted earnings, however, beat Wall Street's expectations.
- HP — Shares slid 7% after the personal computing company offered weaker-than-expected earnings guidance for its fiscal 2025 first quarter. HP expects to earn between 70 cents and 76 cents, excluding items, while analysts polled by FactSet were anticipating 85 cents per share for the period.
- Workday — The stock slid 10% after the human resources software company announced that it sees its subscription revenues and its operating margin coming in lower than expected for the fourth quarter. Workday forecast $2.025 billion in subscription revenues and an operating margin of 25% for the period, while analysts polled by StreetAccount estimated $2.04 billion in subscription revenues and an operating margin of 25.5%.
Read here for the full list.
— Sean Conlon
Stock futures are little changed
Stock futures opened little changed on Tuesday evening.
Futures tied to the Dow Jones Industrial Average gained 20 points, or 0.04%. S&P 500 futures likewise moved 0.04% higher, while Nasdaq-100 futures fell 0.03%.
— Sean Conlon