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Stock Market News for Nov 3, 2021

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Wall Street maintained its northbound journey on Tuesday with all three major stock indexes closed at record-high levels for three consecutive days. This happened for the first time since December 2019. Strong third-quarter 2021 earnings results have reaffirmed solid fundamentals of the U.S. economy, boosting market participants’ confidence on U.S. equities. Moreover, investors are waiting for the outcome of the crucial Fed FOMC meeting that will end on Nov 3.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) rose 0.4% or 138.79 points to close at 36,052.63, marking its all-time closing high. In intraday trading, the blue-chip index recorded a fresh all-time high of 36,088.81. Notably, 18 components of the 30-stock index ended in the green while 12 in red.  

The tech-heavy Nasdaq Composite finished at 15,649.60, gaining 0.3% due to strong performance by large-cap technology stocks. This marked the tech-laden index’s new closing high. In intraday trading, the index recorded a fresh all-time high of 15,656.60.

Meanwhile, the S&P 500 advanced 0.4% to end at 4,630.65. marking the broad-market index’s new closing high. In intraday trading, the index registered a fresh all-time high of 4,633.06. Nine out of eleven sectors of the benchmark index closed in positive territory and two in red. The Materials Select Sector SPDR (XLB) increased 1.1% while the Energy Select Sector SPDR (XLE) fell 0.9%.

The S&P 500 pharmaceutical behemoth Pfizer Inc. (PFE - Free Report) came out with quarterly earnings of $1.34 per share, beating the Zacks Consensus Estimate of $1.08 per share. The company posted revenues of $24.09 billion for the quarter, beating the Zacks Consensus Estimate by 7.50%.

Consequently, share price of Pfizer was up 4.2%. Pfizer carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The fear-gauge CBOE Volatility Index (VIX) was down 2.3% to 16.03. A total of 10.2 billion shares were traded on Tuesday, lower than the last 20-session average of 10.3 billion. Decliners outnumbered advancers on the NYSE by a 1.09-to-1 ratio. On Nasdaq, a 1.02-to-1 ratio favored advancing issues.

Crucial Fed Meeting in Focus

The Fed has commenced its latest FOMC meeting on Nov 2 that will conclude on Nov 3. On that day, at 2:00 PM EST, Fed Chairman Jerome Powell will give statement and discuss with the press about the outcome of this meeting. Market participants across the world will keenly analyze Fed’s decisions whether the central bank will start tapering its extraordinary monetary stimulus from this year.

On March 2020, on the global outbreak of the coronavirus-led pandemic, the Fed reduced the benchmark interest rate to a s low as 0-0.25% and initiated a $120 billion per month bond-buy ($80 billion of Treasury securities and $40 billion of mortgage-backed securities) program in order to inject sufficient liquidity in the system so that the economy can withstand an unprecedented health-hazard-led devastation.

In its Jackson Hole symposium on August 2020, the central bank stated that the first rate hike is expected to come in 2024 and before that it will start tapering bond-buy program from 2023. The U.S. economy almost fully reopened in 2021 buoyed by nationwide COVID-19 vaccination drive. Moreover, new cases of coronavirus and its highly-infectious Delta variant dropped sharply.

Meanwhile, the global economy continues to face a massive supply-chain breakdown and the U.S. economy was no exception. Moreover, U.S. businesses are facing huge shortage of skilled manpower. As a result, input costs and wage rate increased significantly.

Nevertheless, the U.S. consumers continue to spend more to fulfil soaring pent-up demand buoyed by more than $2 trillion of personal savings that were generated during the lockdown-led restrictions. The combination of demand-pull and cost push inflations has pushed the general price level to 30-year high.

Consequently, the Fed Chairman has already signaled that tapering of monetary stimulus and the first rate hike may come much earlier than anticipated initially. Market participants are eagerly waiting for the Fed Chairman’s post FOMC meeting statement to see when the tapering will start and what will be its magnitude. Investors will also try to understand when the first rate hike will come.

Stocks That Have Made Headline

Old Dominion's Q3 Earnings Surpass Estimates, Up Y/Y

Old Dominion Freight Line Inc.’s (ODFL - Free Report) third-quarter 2021 earnings per share of $2.47 outpaced the Zacks Consensus Estimate by $0.10. (Read More)

Republic Services Beats on Q3 Earnings, Raises '21 View

Republic Services Inc. (RSG - Free Report) reported impressive third-quarter 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. (Read More)


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Pfizer Inc. (PFE) - free report >>

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Old Dominion Freight Line, Inc. (ODFL) - free report >>

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