S&P 500 Rallies as Bulls Up Bets on Tesla, Tech
By Yasin Ebrahim
Investing.com – The S&P 500 climbed Wednesday, as gains in Tesla and big tech helped the broader market continue its rebound following the recent omicron selloff.
The S&P 500 rose 1.0%, the Dow Jones Industrial Average added 0.7% , or 261 points, the Nasdaq climbed 1.2%, and Russell 2000 was up 0.8%.
Tesla (NASDAQ:TSLA) rose more than 7% after chief executive Elon Musk said he has sold “enough stock” to achieve his goal of selling 10% of his stake in the electric car company.
The move higher in Tesla comes just weeks ahead of the EV maker’s fourth quarter update on deliveries.
“Tesla typically reports within 2-3 days of quarter-end so expect the results early in the new year,” RBC Capital Markets said in a note, forecasting total 4Q21 deliveries of 285,000 units.
Consumer discretionary was also boosted by a surge in reopening stocks as travel and hospitality corners of the market racked up gains.
Carnival (NYSE:CCL), Royal Caribbean Cruises (NYSE:RCL) were up more than 3%, while Expedia (NASDAQ:EXPE) was up 2%.
Sentiment on reopening stocks was also strengthened by news that Pfizer’s Covid-19 pill has received emergency use authorization. Pfizer’s Paxlovid is the first at-home medication authorized for Covid-19.
“Pfizer stands ready to begin delivery in the U.S. immediately to help get PAXLOVID into the hands of appropriate patients as quickly as possible,” said Albert Bourla, chairman and chief executive officer of Pfizer (NYSE:PFE).
Big tech, with exception of Meta, formerly known as Facebook (NASDAQ:FB), also pushed the broader market higher.
Microsoft (NASDAQ:MSFT), Google-parent Alphabet (NASDAQ:GOOGL), Apple (NASDAQ:AAPL), and Amazon (NASDAQ:AMZN) were higher.
Energy added to gains from a day earlier rising more than 1% as oil prices were boosted by a larger-than-expected decrease in weekly U.S. crude inventories.
U.S. inventories fell by 4.7 million barrels, above expectations for a 2.8 million barrel decline.
Devon Energy (NYSE:DVN), APA (NASDAQ:APA), Marathon Oil (NYSE:MRO) were the top gainers in the energy sector.
In industrials, meanwhile, Caterpillar Inc (NYSE:CAT) rose more than 1% after Bernstein upgraded the company to outperform from perform, citing upside into 2022.
Coinbase (NASDAQ:COIN) climbed 2% after Oppenheimer named the company a top pick for 2022 as the acceleration of digital assets adoption will continue to bolster the crypto exchange’s growth prospects.
“For institutional investors who are interested in getting exposure to digital assets, we believe COIN [Coinbase] is well positioned to benefit from it,” Oppenheimer said.
On the economic front, the U.S. consumer continued to remain resilient shrugging off concerns about inflation amid “strong income expectations,” Jefferies said.
The consumer confidence index rose to 115.8 in December, well above consensus for a reading of 111.0.
Developments in Washington also supported the market melt up after President Joe Biden said he would extend the pause on student-loan repayments through May 1.
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