The Dow and the S&P 500 ended slightly higher on Wednesday while the Nasdaq lost ground after October data showed consumer prices rising in line with expectations, adding support to bets that the U.S. Federal Reserve will cut interest rates in December.
Market Snapshot
The Dow Jones Industrial Average rose 47.21 points, or 0.11%, to 43,958.19, the S&P 500 rose 1.39 points, or 0.02%, to 5,985.38 and the Nasdaq Composite lost 50.68 points, or 0.26%, to 19,230.73.
Market Movers
Tesla rose 0.5% but pared earlier gains. President-elect Donald Trump announced late Tuesday that Elon Musk, chief executive of the electric-vehicle maker, along with biotech company founder Vivek Ramaswamy, was appointed to lead the so-called Department of Government Efficiency. In addition to running Tesla, Musk is CEO of SpaceX, owns the social-media site X, and created neurotechnology company Neuralink. Investors will have to decide whether Musk's new commitment will be an issue for the EV maker.
Space-launch company Rocket Lab USA reported third-quarter sales of $105 million, beating Wall Street estimates of $103 million. For the fourth quarter, Rocket Lab expects to generate sales of $125 million to $135 million, above forecasts of $122 million. Shares soared 28%.
MARA Holdings shares dipped 14% after turning in a Q3 loss that narrowed less than expected, as its bitcoin (BTC-USD) production inched up 1% during the quarter.
Rivian Automotive jumped by 14% after Volkswagen said it plans to invest up to $5.8 billion in the electric-vehicle maker, more than the $5 billion the companies agreed to when the joint venture was announced in June. Under the partnership, the two auto makers will work on electrical architecture and software for EVs.
Super Micro Computer declined by 6.3% after the server maker said it needs additional time to file its 10-Q form for earnings in the quarter ended Sept. 30. The company already was under pressure to submit its 10-K for the fiscal year ended June 30 by Nov. 16, after which it risks being delisted from the Nasdaq.
Spirit Airlines dropped by 59% to $1.31 after The Wall Street Journal reported the airline was preparing to file for bankruptcy protection after merger talks with Frontier Airlines broke down. The Journal report cited people familiar with the matter.
Spotify Technology rose by 11% after the audio streaming service reported third-quarter earnings of EUR300 million ($317 million) in the period, up from EUR65 million a year earlier. On a per-share basis, profit of EUR1.45 missed analysts' expectations. Revenue rose by 19% to EUR3.99 billion and monthly active users jumped 11% to 640 million, higher than analysts' estimates of 639 million.
Cava Group, the Mediterranean fast-casual restaurant chain, posted third-quarter earnings that beat Wall Street expectations and the stock jumped by 1.6%. Revenue in the period rose by 39% from a year earlier to $241.5 million and beat Wall Street forecasts.
Skyworks Solutions fell by 4.5% after the semiconductor company posted fourth-quarter adjusted earnings of $1.55 a share that beat Wall Street expectations and revenue that met estimates but issued guidance for its fiscal first quarter that missed forecasts.
Revenue at Instacart rose by 12% in the third quarter to $852 million, beating Wall Street expectations of $844 million, and profit at the grocery delivery company of 42 cents a share was a swing from a year-earlier loss and topped estimates of 22 cents a share. Total gross transaction value rose to $8.3 billion from $7.49 billion and was higher than estimates of $8.2 billion. The stock, however, was down 11%.
ZoomInfo Technologies fell 20% after the provider of databases of customer contact information, posted third-quarter revenue of $303.6 million that beat analysts' estimates but fell 3.3% from a year earlier. The company said it expects fourth-quarter revenue of $296 million to $299 million.
Natera, the genetic testing services company, reported a narrower-than-expected third-quarter loss on a revenue jump of 64% to $439.8 million and said it expects fiscal-year revenue of $1.61 billion to $1.64 billion, better than analysts' forecasts of $1.52 billion. The stock rose 19%.
SoundHound AI fell by 17% even as the company, which makes voice-technology software powered by artificial intelligence, beat Wall Street estimates for the third quarter and raised its outlook.
Stratasys was up by 21% after the 3-D printer maker reported better-than-expected third-quarter earnings and revenue.
Market News
Bitcoin's Price Run Continues as it Rises Above $93,000
The post-election bitcoin price run has shown no signs of slowing down, as the world's largest crypto asset recently traded above $93,000 for the first time in its history.
It was last down slightly at $90,403, but has risen over 30% since the Nov. 5 election.
BlackRock's iShares Bitcoin Trust has now crossed the $40 billion inflows threshold in the fastest time for any ETF on record (211 days) and is now larger than any other ETF launched in the past 10 years, according to Bloomberg Senior ETF Analyst Eric Balchunas. IBIT surpassed the size of BlackRock's iShares Gold Trust (IAU) just last week.
Oct CPI Inflation up Modestly, as Expected
U.S. consumer prices increased as expected in October, and progress toward bringing inflation down has slowed since mid-year, which could result in fewer interest rate cuts from the Federal Reserve next year.
The consumer price index rose 0.2% for the fourth straight month, the Labor Department said on Wednesday. In the 12 months through October, the CPI advanced 2.6% after climbing 2.4% in September. The headline numbers were predicted by economists polled by Reuters. The up-tick in annual inflation also reflects last year's low reading dropping out of the calculation.
Markets See 80% Chance of December Fed Cut After Inflation Data
Traders added to wagers that the Federal Reserve will cut interest rates by another quarter point next month after in-line inflation data, spurring gains for Treasury debt.
The rally trimmed yields on two-year notes, more closely tied than longer tenors to Fed rate decisions, by as much as 10 basis points to 4.24%. Swaps traders boosted to about 80% the probability that the Fed will cut rates again on Dec. 18, up from around 56% earlier Wednesday. Through June, they priced in just over 60 basis points of cumulative reductions.
