Stock market today: Dow racks up gains as retail, tech stocks jump

© Reuters Stock market today: Dow racks up gains as retail, tech stocks jump

By Yasin Ebrahim

Investing.com — The Dow racked up gains Tuesday, underpinned by a string of mostly positive quarterly results from retailers and dip-buying in big tech and energy following a stumble a day earlier.

The Dow Jones Industrial Average gained 1.2%, or 397 points, the Nasdaq rose 1.36%, and the S&P 500 rose 1.36%,

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Best Buy (NYSE:BBY), ended up nearly 13%, led a surge in retailers after lifting full-year guidance and reporting quarterly results that beat on both the top and bottom lines, as a ramp-up in promotional activity boosted demand.

Dick’s Sporting Goods Inc (NYSE:DKS) and Abercrombie&Fitch (NYSE:ANF) rose 10% and 21% respectively, following quarterly results that topped Wall Street estimates.

Energy stocks pared their losses from a day earlier as oil prices continued to add gains after Saudi Arabia said OPEC and its allies, known as OPEC+, would persist with plans to cut production.

Still, concerns about energy demand are expected to continue to dominate attention as cities in China, the world’s top energy importer, have imposed restrictions following a spike in Covid cases

“If oil demand in China indeed turns out to be weaker than expected, this would point to an oversupplied market, at least in the short term,” Commerzbank said in a note.

Tech stocks were on the ascendency, underpinned by a retreat in Treasury yields ahead of the release of the minutes from the Federal Reserve’s October meeting.

The Fed hinted at slowing the pace of rate hikes at its December meeting, though added that the peak for rate hikes would be higher than previously anticipated. The prospect of higher for longer rates has raised concerns about the Fed failing to avoid a soft landing, or recession, at a time when global growth is slowing.

“We would all like to think that the Fed will be able to do that, but there’s a good chance that they may not [deliver a soft landing],” Melissa Brown, managing director of applied research at Qontigo, told Investing.com’s Yasin Ebrahim on Tuesday.

“Historically we’ve seen very few actual soft landings…as they tightened for too long or too much,” Brown added.

Zoom Video Communications (NASDAQ:ZM), meanwhile, slipped about 4% after its cut to full-year revenue guidance on concerns about slowing consumer spending offset quarterly results that beat Wall Street estimates. 

The video conferencing software maker faces near-term headwinds including tough Covid-19 comps, small to medium-sized business churn, and normalizing sales cycles, that will “create near-term headwinds to revenue growth over the next 4-6 quarters,” Goldman Sachs said in a note. But longer-term, “we believe revenue growth can be potentially sustained,” it added.

In other news, Bitcoin (BitfinexUSD) rebounded from a two-year low as sentiment on cryptos improved following reports that cryptocurrency entrepreneur Justin Sun could potentially purchase assets from FTX.

Manchester United (NYSE:MANU) jumped 15% on reports that the Glazer family is exploring a potential full or partial sale of the club.

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