Stocks tumbled Wednesday, weighed down by some downbeat economic data and the stalemate in Congress over additional fiscal stimulus. On the economics front, a report from IHS Markit showed the recovery in U.S. business activity slowed last month, raising fears that the economy is decelerating as it approaches the end of the third quarter. Meanwhile, the impasse in D.C. over a second round of financial help for businesses and the unemployed continued to hurt investor sentiment. The blue-chip Dow Jones Industrial Average finished the session down 1.9%, or 525 points, at 26,763.
Although stocks gave up early gains on Wednesday morning following disappointing business activity data, strategists noted that the landscape wasn't totally bereft of good news. "On the positive side, Nike posted strong fiscal first-quarter earnings, driven by more than 80% growth in digital sales," writes Argus Research. "Johnson & Johnson also announced the start of a Phase 3 trial of its single-dose coronavirus vaccine candidate."
Other action in the stock market today:
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- The Nasdaq Composite lost 3%.
- The S&P 500 fell 2.4%
- The small-cap Russell 2000 declined 2.9%.
- Tesla's (TSLA) long-awaited "Battery Day" landed with a thud. The electric vehicle company touted a cheaper, more efficient battery that would lower car prices, but ultimately the Street responded by selling the news. "Tesla’s battery day was long on vision and boldness, but short on specifics and near term deliverables," wrote Bernstein Research. Shares in TSLA dropped 10.3% to $380.36.
Don't Overlook Growth Stocks with a Value Component
It's no secret that growth stocks have outperformed value stocks over the past decade, and they aren't expected to cool off anytime soon. They sure have proven their worth in 2020. Some long-term investors may be put off by the tendency of growth stocks to have pricier valuations and greater volatility, but there's actually no shortage of growth names that have a value component as well. Check out the stocks most favored by the nation's hedge funds, and you'll see plenty of "growth" names that have rock-solid balance sheets, defensible franchises and even steady dividends. Or have a look at the normally poky telecommunications sector, which can claim ownership of some stocks poised for outsized growth thanks to the build-out of 5G mobile networks. And it shouldn't go unnoticed that Warren Buffett -- an investor who hardly takes untoward risk and loves dividends -- has bought a slew of growth stocks for Berkshire Hathaway's portfolio. Indeed, notwithstanding his recent backing of a blockbuster tech IPO, many of Buffett's favorite growth stocks offer investors a comfortable combination of outperformance, income and safety.
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What the Comcast Cable Spinoff Means for InvestorsComcast has announced plans to spin off select cable networks and digital assets into a separate publicly traded company. Here's what you need to know.
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TJX Stock: Wall Street Stays Bullish After EarningsTJX stock is trading lower Wednesday despite the TJ Maxx owner's beat-and-raise quarter, but analysts aren't worried. Here's why.
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Stock Market Today: Nasdaq Jumps Ahead of Nvidia EarningsIt was a mostly positive start to a new week of pricing in more Donald Trump.
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Stock Market Today: Stocks Slip After Powell Talks Rate CutsThe main indexes closed lower Thursday after Fed Chair Powell said there's no rush to cut rates.
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Stock Market Today: S&P 500 Tops 6K as Election Rally EnduresThe S&P 500 closed just below the 6,000 mark on Monday.
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Why Is Warren Buffett Selling So Much Stock?Berkshire Hathaway is dumping equities, hoarding cash and making market participants nervous.
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Fed Cuts Rates Again: What the Experts Are SayingFederal Reserve The central bank continued to ease, but a new administration in Washington clouds the outlook for future policy moves.
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Stock Market Today: Dow Jumps 1,500 Points on Election OutcomeThe removal of election uncertainty unleashed a powerful rally in equity markets.
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Should You Buy Tesla Stock After Trump's Election Win?Shares in Tesla popped on the outcome of the presidential election. Is it time to buy?
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Stocks Rally on Election Day as Markets Brace for VolatilityAll three major indexes opened higher as voters chose the 47th President of the United States.
