The major stock market indexes were mixed Wednesday afternoon and near the highs of the day. January retail sales came in stronger than expected, showing continued consumer strength, which added to concerns the Fed will need to continue its rate hikes.
X
The Dow Jones Industrial Average fell 0.3%, and the S&P 500 retreated 0.1%. The Nasdaq composite pulled ahead 0.4%, while the small-cap Russell 2000 regained 0.6%.
Volume on the NYSE was slightly higher and on the Nasdaq mildly lower vs. the same time on Tuesday.
The Dow held support at its 50-day moving average, while the S&P 500 held above its 21-day exponential moving average. The Nasdaq remains above its 200-day moving average and its 21-day line. The tech-heavy Nasdaq 100-tracking Invesco QQQ Trust ETF (QQQ) added 0.2%.
Crude oil inched down 0.1% to $79 per barrel. The Energy Select Sector SPDR ETF (XLE) trimmed 2%, dropping below its 21-day line.
Bitcoin futures rose 2.8% to $22,950. The Innovator IBD 50 ETF (FFTY) pulled back 0.5%.
The 10-year U.S. Treasury yield added 5 basis points to 3.80%.
European markets were up, with the German DAX tacking on 0.8% and the Paris CAC showing dominance with its 1.2% gain. The London FTSE added 0.6% to close out the trading day.
January retail sales rose 3% vs. the 1.7% Econoday consensus. Excluding vehicle numbers, sales rose 2.3% vs. the 0.9% drop expected. Sales ex-vehicles and gas rose 2.6% vs. a 0.4% decline expected. January’s rise follows drops in November and December, showings consumers are still confident in purchasing, while the job market remains strong.
The higher retail numbers on top of Tuesday’s strong January CPI numbers has investors concerned the Fed will need to continue raising rates to tamp down the sticky high inflation numbers.
Stock Market Action: Travel, Gaming Stocks Rally
Airbnb (ABNB) jumped 12.9% after the company reported better-than-expected Q4 sales and earnings and its first annual profit late Tuesday. The short-term rental platform gave positive Q1 guidance but warned of upcoming price cuts. The stock gapped above the 121.50 buy point of a cup-with-handle base.
Online travel company TripAdvisor (TRIP) pulled back from a morning spike, rising 1.6%, after reporting better-than-expected Q4 earnings per share and sales.
Gaming platform Roblox (RBLX) gapped up over 24% after posting higher-than-expected Q4 sales numbers. RBLX stock cleared a 41.68 handle entry in heavy volume.
Trade Desk (TTD) gapped up over 25% after reporting higher-than-expected adjusted Q4 EPS and Q4 sales and gave positive Q1 revenue guidance. The digital advertising services firm also announced a $700 million stock buyback program.
Life sciences company Emergent BioSolutions (EBS) jumped over 11% after announcing it agreed to sell its travel health business to monkeypox vaccine maker Bavarian Nordic (BVNRY) for up to $380 million. Bavarian’s stock dipped 1.5% on the news.
IBD 50 stock Credo (CRDO) plummeted over 46% in heavy volume, following news late Tuesday that April-quarter revenue is expected to be considerably lower than previously stated. The data infrastructure company guided revenue down to $30 million-$32 million from $54 million-$56 million, saying its “largest customer has reduced its demand forecast for certain Credo products.”
Oil and natural gas producer Devon Energy (DVN) gapped down more than 11% in heavy volume. The company reported worse-than-expected Q4 adjusted EPS and sales numbers. The stock is the S&P 500’s biggest loser today.
Follow Kimberley Koenig for more stock news on Twitter @IBD_KKoenig.
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