U.S. Averages Attempt to Extend Longest Rally In Two Years

Barry Adams
08 Nov, 2023
New York City

The stock market continued its upward march as upbeat investors looked for bargains in tech and high-growth stocks.

The S&P 500 index and the Nasdaq Composite extended the gains of the previous week after interest rate uncertainties receded.

Investors are hoping that the Federal Reserve may be able to navigate the U.S. economy to a soft landing and avoid future rate hikes.

The Federal Reserve is attempting to keep economic growth intact while slowing inflation to its target rate of 2% and keeping the labor market from shrinking.

Investors are increasingly confident that the Federal Reserve is likely to engineer a so-called soft landing, driving the stock market higher and keeping inflation in check.

In today's trading, investors bid up big tech stocks and reacted to earnings releases.

The electric vehicle maker Rivian jumped more than 6% on better-than-expected quarterly results and production outlook; Robinhood declined more than 10% after transaction-based revenue declined 11% from a year ago; and Toast Inc. plunged more than 15% after the restaurant software company swung to a loss in the latest quarter.

 

U.S. indexes and Yields

The S&P 500 index increased 0.2% to 4,387.84, and the Nasdaq Composite increased 0.2% to 13,660.29.

The yield on 2-year Treasury notes increased to 4.93%, 10-year Treasury notes inched higher to 4.55%, and 30-year Treasury bonds edged down to 4.69%.

Crude oil decreased $0.71 to $71.67 a barrel, and natural gas prices rose 0.1 cent to $3.14 a thermal unit.

Gold decreased $9.40 to $1,959.82 an ounce after bond yields edged lower and the dollar weakened.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 106.65.

 

U.S. Stock Movers

Robinhood Markets Inc. dropped 12.4% to $8.55 after the online trading platform reported weaker-than-expected sales of $467 million in the third quarter.

Revenue in the third quarter increased by 29% to $467 million, driven by a 96% increase in net interest income to $251 million.

Net loss in the quarter shrank to $85 million from $175 million, and diluted loss per share fell to 9 cents from 20 cents a year ago.

Average revenue per user increased by 27% to $80, and monthly active users fell 16% to 10.3 million.

Net deposit inflow in the quarter was $4 billion, and assets under custody surged 34% to $87 billion, reflecting higher equity valuations and a continued net inflow of assets.

eBay declined 5.8% to $38.45 after the online marketplace reported mixed quarterly results.

Revenue in the third quarter increased 5% to $2.5 billion from $2.4 billion, the company swung to a net profit of $1.3 billion from a loss of $69 million, and diluted earnings per share increased to $2.47 from a loss of 13 cents a year ago.

The company guided fourth-quarter revenue to fall between $2.47 and $2.5 billion and diluted earnings per share between 70 cents and 75 cents.

eBay estimated full-year 2023 revenue to range between $10.02 billion and $10.08 billion and diluted earnings per share between $4.53 and $4.58.