In this Nov. 16, 2020 file photo a man wearing a mask passes the New York Stock Exchange in New York. Stocks are opening moderately lower on Wall Street, edging below the record highs they set a day earlier. The S&P 500 fell 0.4% shortly after the opening bell Wednesday, Dec. 2. (AP Photo/Mark Lennihan, File)
By Damian J. Troise and Alex Veiga
Stocks shook off a sluggish start to finish with modest gains Wednesday, nudging the S&P 500 index to an all-time high for the second straight day.
The benchmark index rose 0.2% after spending much of the day drifting between small gains and losses. About 54% of the stocks in the index rose, with communications, financial and health care companies driving the bulk of the gains. A pullback in technology stocks, companies that rely on consumer spending and elsewhere kept the market's gains in check.
Treasury yields continued to head mostly higher, a sign of growing confidence in the outlook for the economy. That confidence has also been pushing stocks higher in recent weeks as traders hope coronavirus vaccines will start driving a stronger economic recovery. Investors were not deterred by new data Wednesday showing that hiring by U.S. companies slowed last month.
“The biggest thing about the market that we’ve seen the last couple of weeks is (investors) keep trying to sell it, and it still hangs in there,” said J.J. Kinahan, chief strategist at TD Ameritrade.
The S&P 500 rose 6.56 points to 3,669.01. The index is now up about 13.6% for the year. The Dow Jones Industrial Average gained 59.87 points, or 0.2%, to 29,883.79. The tech-heavy Nasdaq composite, which also opened the month with a new record, slipped 5.74 points, or 0.1%, to 12,349.37.
Stocks have been ramping higher in recent weeks as drugmakers make steady progress in developing coronavirus vaccines. The rollout of a vaccine in the U.S. could begin this month, if regulators give their approval.
Pfizer shares rose 3.5% after the drugmaker and BioNTech said they won permission for emergency use of their COVID-19 vaccine in Britain. The vaccine is the world’s first coronavirus shot that’s backed by rigorous science and a major step toward eventually ending the pandemic. The move makes Britain one of the first countries to begin vaccinating its population against the virus. The companies have already asked for approval to begin vaccinations in the U.S. in December.
Moderna is also asking U.S. and European regulators to allow emergency use of its COVID-19 vaccine. Its shares rose 1.4%.
Optimism about vaccine developments have tempered lingering concerns over rising virus cases in the U.S., though worries persist about the economic fallout from new government restrictions on businesses aimed at limiting the spread.
“My farther-out fear for the market is once this vaccine starts to roll out, will it be able to meet these amazing expectations people have for everything getting back to normal?” Kinahan said.
Unemployment remains high as the COVID-19 outbreak widens the gulf between average people and the wealthiest Americans. Payroll processor ADP said Wednesday that its latest survey of private U.S. employers shows they added 307,000 jobs last month. That fell short of Wall Street analysts’ expectations for a gain of 405,000 jobs, according to FactSet.
The report precedes a broader jobs survey from the Labor Department due out Friday. Economists are forecasting that will show employers added about 441,000 jobs in November, down from a gain of 638,000 in October.
Meanwhile, traders are holding out hope that Democrats and Republicans may reach a deal on some amount of economic stimulus for the economy before 2021, though the parties remain divided on the details and the cost.
The Federal Reserve's latest survey of business conditions around the U.S. found economic activity has slowed in some parts of the country as amid a surge in new coronavirus cases. On Wednesday, Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin told lawmakers during a House Financial Services Committee hearing that Congress needs to approve COVID-19 relief funds without further delay.
However, it's looks like most lawmakers are willing to wait until after President-elect Joe Biden takes office, said Ross Mayfield, investment strategy analyst at Baird.
“The problem is, by that point you’re going to have six to 10 more weeks of economic damage,” he said.
Technology stocks, which have been leading the market higher since the pandemic started wreaking havoc on the global economy, helped limit the market's gains Wednesday. Salesforce.com was the biggest decliner in the S&P 500, tumbling 8.5%, after announcing a deal late Tuesday to buy messaging platform Slack for $27.7 billion. Microsoft slipped 0.4%.
Lyft climbed 9.6% after the ride-hailing company posted a smaller loss this quarter and better margins. The news helped boost rival Uber Technologies up 7%.
Treasury yields headed higher, giving banks a boost because they allow them to charge more lucrative interest rates on loans. The yield on the 10-year Treasury rose to 0.96% from 0.92% late Tuesday. JPMorgan Chase rose 1.9% and Citigroup gained 3.1%.
Germany's DAX shed 0.5% and France's CAC 40 was flat. In Britain, the FTSE 100 rose 1.2%. Markets in Asia were mixed.
Private equity firms in 2021 spent $401.71 billion in U.S. tech investments — doubling 2020's level of $196.34 billion. As tech becomes increasingly interwoven into our lives amid the pandemic, investors grow bullish on the sector, especially software-as-a-service companies. How will 2022 stack up to 2021, and is there potential for parts of the tech sector to sink this year? John Jannarone, Editor in Chief at IPO-Edge, joins Cheddar News' Closing Bell to discuss 2021's record year of deals, how potential interest rate hikes will impact tech investments in 2022, the fastest-growing IPOs, and more.
Bed Bath & Beyond delivered disappointing fiscal third-quarter results for 2022. Shares initially dove more than 9% in premarket trading on the news but finished the day up nearly 8%. Bed Bath & Beyond has been a meme-stock target for online investors in the past -- so was meme-stock mania a factor in the recent stock movement for the company? Jaime Rogozinski, the founder of the subreddit WallStreetBets, joins Cheddar News' Closing Bell for more, as his forum helped spark the meme stock phenomena. He also discussed some decentralized finance services and trends for the retail investor to watch for in 2022.
College athletes scored big in 2021 when they were finally allowed to begin earning money based off of their name, image, and likeness, known as NIL. But how can young athletes best manage their money so they can set themselves up for years of success? Nicole Pullen Ross, Head of Goldman Sachs Sports and Entertainment Solutions, joins Cheddar News' Closing Bell to discuss why financial management for college athletes is important, common pitfalls they could run into, and more.
December's jobs report was weaker than expected: the economy only added 199,000 nonfarm payrolls compared to an estimate of 422,000. However, the unemployment rate hit a new pandemic-era low of 3.9%, beating expectations. One thing to consider is the fact that the impact of the COVID-19 omicron variant is not factored into these results as the read is taken around the middle of the month. So — how might the variant impact job reports over the next few months? Mark Zandi, Chief Economist at Moody's Analytics, joins Cheddar News' Closing Bell to discuss December's jobs numbers, his 2022 labor market outlook, how COVID-19 will continue to impact the labor market, and more.
Digital medical care provider Pear Therapeutics rang the closing bell on the Nasdaq Friday and President and CEO Dr. Corey McCann, joined Cheddar to talk about how the company plans to grow the business of software-based therapeutics and how the first FDA authorized prescription digital therapeutics company will go about treating illnesses like insomnia and addiction. "These really are pieces of software. In many cases, they're apps and in the cases of our addiction products, these are based on something called cognitive behavioral therapy or CBT," he said. "These products change the patient's brain circuitry to help them be abstinent, to help them stay in treatment, and that's exactly what we see in randomized clinical trials and that's what we see in the real world." He also addressed the ongoing mental health crises brought on by the pandemic. **copy updated to remove IPO information as Pear Therapeutics went public in December**
Gamestop shares were up on The Wall Street Journal report that the video game retail company plans to enter the NFT and crypto space. Adam Hollander, the founder of Hungry Wolves NFT, joined Cheddar to break down how it could be a lifeline for the struggling meme stock darling. "They're not resigning themselves to becoming the next Blockbuster story, and so while people may not be buying as many video games in a retail environment anymore, NFTs, in particular, people are starting to expect more gaming utility on the backend — at least for a variety of projects — and I personally think its a very smart move for them to do this," Hollander told Cheddar.
On Saturday, New York will join neighboring New Jersey and Connecticut in authorizing mobile sports betting. Matt Kalish, president and co-founder of Draftkings North America, joined Cheddar to talk about the landmark change that is estimated to rake in $500 million in annual tax revenue on a potential billion-dollar market. Kalish also addressed the possibility that legalized sports betting in the Empire State could cannibalize his company's revenues in the bordering states. "It's pretty inconvenient, you know, to go across the border to make a bet. And people were doing it, but I think it really stifled a lot of the opportunity," he said. "So while there's some of that going on, I think really a tremendous amount, like a giant percent, of New York will be very incremental."
James Tattersall, director of sales and marketing for Lake Nona Wave Hotel, talks about the hotel's initiatives to foster diversity and how these amenities champion inclusivity in the Orlando area.
Desmond Howard, former NFL wide receiver and Modelo college football playoff ambassador, joins Cheddar News to talk about the Modelo sweepstakes honoring the 30th anniversary of his iconic punt return.
Satoshi Island is looking to become the world's first blockchain-driven economy. James Law, the chief architect of the planned private community, joined Cheddar to discuss the vision for the potential crypto capital of the world and how it will be brought to life. For people looking to live on the island, Law said they will be able to purchase land and homes and even design their own dwellings both in real life and via the metaverse. "Satoshi Island has already been digitally scanned. We have an absolute digital twin already in our metaverse," he said. Citizenship applications are expected to be launched via NFTs, he told Cheddar.
