On November 21, 2018, U.S. stocks staged a rebound after a bruising two-day selloff, with better-than-expected earnings from Foot Locker and a recovery in technology shares helping calm investors before the Thanksgiving holiday.
Foot Locker Inc led the move, jumping 15.9 percent after reporting its first same-store sales gain in six quarters. The result also beat market expectations and gave a lift to the broader consumer discretionary sector.
Nike Inc, one of Foot Locker’s suppliers, rose 1.3 percent. Gap Inc added 4.9 percent after analysts turned more positive on the outlook for its Old Navy brand. Together, Foot Locker and Gap helped push the S&P consumer discretionary index to the top of the 11 major S&P sectors.
Technology stocks also steadied after several weak sessions. Apple Inc gained 0.5 percent, though the company remained more than 20 percent below its record closing high from Oct. 3, as investors continued to worry about slowing iPhone demand.
The rest of the FAANG group also moved higher. Amazon.com Inc, Netflix Inc, Alphabet Inc and Facebook Inc rose between 1.3 percent and 2.3 percent as pressure on the sector eased.
Autodesk Inc was another standout, climbing 10.5 percent after it reported third-quarter results that topped estimates and announced an $875 million purchase of cloud software company PlanGrid. That made Autodesk the strongest performer in the S&P technology sector, which was up 0.7 percent after three straight days of declines.
“The tone for bulls is to find anything to stop the bleeding,” said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee. He added: “I think the first hour will be super critical today. If sellers come in and just start smacking the thing right away then we are set for more volatility, more bloodbath here.”
By 9:57 a.m. EDT, the Dow Jones Industrial Average was up 99.16 points, or 0.41 percent, at 24,564.80. The S&P 500 had gained 14.14 points, or 0.54 percent, to 2,656.03, while the Nasdaq Composite was up 65.04 points, or 0.94 percent, at 6,973.87.
Energy shares also firmed, with the S&P energy index rising 1.2 percent after oil prices bounced back from a 6 percent drop the previous day. Semiconductor stocks joined the recovery, as the Philadelphia SE semiconductor index added 0.8 percent. Advanced Micro Devices Inc and Nvidia Corp each rose 1.2 percent, while Micron Technology Inc gained 2.0 percent.
The broader backdrop remained uneasy. Investors had been rattled in recent months by concerns about slowing global growth and the possibility that corporate earnings had peaked, raising questions about how long the decade-old bull market could last.
The previous day had been especially painful: the Nasdaq closed at its lowest level in more than seven months on Tuesday, while the S&P 500 and the Dow had wiped out all of their gains for 2018.
Fresh economic data added to the cautious mood. New orders for key U.S.-made capital goods were unexpectedly unchanged in October, while shipments recovered only modestly, a sign that business spending on equipment may not accelerate quickly in the fourth quarter.
Market breadth was positive. Advancing issues outnumbered decliners by 3.74-to-1 on the NYSE and by 2.62-to-1 on the Nasdaq. The S&P index recorded one new 52-week high and two new lows, while the Nasdaq posted four new highs and 38 new lows.
Reporting by Medha Singh in Bengaluru; Editing by Anil D'Silva.
