Markets

Stock Market Climbs As Services Sector Jumps; PayPal And Moderna Lead On Earnings

The stock market climbed Wednesday as the services sector rallied on fresh economic data. Fintech provider PayPal (PYPL) and vaccine maker Moderna (MRNA) led the way on strong earnings.




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The Nasdaq composite jumped 2%. The S&P 500 rose 1.2% and the Dow Jones Industrial Average added 1%. The small-cap Russell 2000 index gained 1%.

Volume rose on the Nasdaq and fell on the NYSE compared with the same time on Tuesday.

The Innovator IBD 50 ETF (FFTY) lagged with a 0.7% decline, led downward by oil stocks.

The service sector Purchasing Managers Index edged past forecasts, posting a 47.3 reading in July despite a weakening trend. It was the fourth straight decline in the seasonally-adjusted index, according to S&P Global. But while inflationary pressures remain historically elevated, input costs and output charges are rising at the slowest paces in the last five and 16 months, respectively.

U.S. Stock Market Today Overview

Index Symbol Price Gain/Loss % Change
Dow Jones (0DJIA) 32728.29 +332.12 +1.03
S&P 500 (0S&P5) 4140.85 +49.66 +1.21
Nasdaq (0NDQC ) 12596.39 +247.63 +2.01
Russell 2000 (IWM) 188.94 +1.94 +1.04
IBD 50 (FFTY) 28.58 -0.19 -0.66
Last Update: 12:16 PM ET 8/3/2022

The July Institute for Supply Management index hit a three-month high. The ISM monitors the activities among 375 service companies. It hit 56.7 in July, far higher than the 53.0 Econoday consensus, and better than June’s 55.3.

Oil Stocks, Crude Oil Prices Fall After OPEC Decision

The price of U.S. crude oil fell 2.5% to below $92 per barrel after OPEC+ agreed to only a small increase in oil production.

‘The U.S. was probably hoping for a larger production increase, especially after Biden’s recent trip to the Middle East,” said Noah Barrett, Research Analyst for Energy & Utilities at Janus Henderson Investors. “In terms of overall supply/demand management, OPEC’s decision is logical.”

The price of crude oil is nearing the Feb. 22 closing price of $91.59 per barrel, just before Russia invaded Ukraine and sent prices skyrocketing.

The Energy Select Sector SPDR ETF (XLE) fell 2.2% on Wednesday, making it the worst performing S&P sector.

Meanwhile, the Communications Services Select Sector ETF (XLC) soared 2%, making it the best performing S&P sector.

PayPal rallied 10% after the electronic payments company said it’s willing to working with activist investor Elliott Management. PayPal also added $15 billion to its stock repurchase program and reported mixed second-quarter results. The stock is trying to bottom out from a deep decline.

Moderna obliterated Covid vaccine sales and profit forecasts on Wednesday morning and surged 15%. The company retained its full-year outlook for $21 billion in sales, based on current agreements.

Moderna stock made a strong move toward its 200-day line, according to MarketSmith.com.


Apple, ARK Stocks Lead Risk-On Rally; 5 Earnings Movers Near Buy Points


 

Robinhood, Ping, Evolent Boost Stock Market

Robinhood (HOOD) jumped nearly 14% in heavy trading after the online brokerage announced Q2 results that included a 34% drop in average monthly users from a year ago. It also made a second round of layoffs, part of a cost-cutting program. Robinhood stock has been in a protracted slump.

Ping Identity (PING) soared 60% on huge volume after the security software maker agreed to a $2.8 billion buyout from investment firm Thoma Bravo. The firm is paying $28.50 per share in cash for Ping, a premium of about 63% over Tuesday’s closing price.

Match Group (MTCH) plunged more than 17% on big volume, ending a rebound attempt for the laggard stock. The dating app company missed sales estimates and posted a loss for the quarter. In addition, Tinder CEO Renate Nyborg is leaving the company. The stock is now at an all-time low.

Evolent Health (EVH) topped earnings estimates and raised its full-year guidance on Tuesday morning. The provider of financial management software for health care jumped 4.5% to a new high. A breakout from a 33.24 buy point failed but Evolent regained the entry. Investors may also view 35.17 as an alternate buy point.

Follow Michael Molinski on Twitter @IMmolinski

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