Stocks opened comfortably higher Wednesday, bouncing back from Tuesday's inflation-fueled selloff. Helping lift sentiment were relatively dovish comments from Chicago Fed President Austan Goolsbee, who said investors shouldn't "get amped up" about one Consumer Price Index (CPI) reading that came in higher than expected.
"If you see inflation go up a little bit that doesn't mean that we're not on the target to get to 2%," Goolsbee said while speaking at the Council of Foreign Relations in New York. "We can still be on the path even if we have some increases and some ups and downs."
All three main indexes tumbled more than 1% Tuesday after a hotter-than-anticipated January CPI report drastically lowered expectations for a Fed rate cut at both the March and May meetings.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Lyft earnings typo sends stock soaring
A round of well-received earnings reports were also in focus today, most notably from Lyft (LYFT). Late Tuesday, the ride-sharing firm disclosed its fourth-quarter results that included higher-than-expected earnings of 18 cents per share on in-line revenue of $1.2 billion. The company also said gross bookings were up 17% year-over-year to $3.7 billion.
In the press release, Lyft initially said it anticipates gross margin to expand roughly 500 basis points – or 5 percentage points – in fiscal 2024. This figure sent shares surging more than 60% in Tuesday's after-hour session.
However, Lyft's Chief Financial Officer Erin Brewer later clarified in the earnings call that this was a clerical mistake and the expectation is actually for gross margin expansion of 50 basis points, or 0.5%.
Still, Lyft "exited 2023 on strong footing with Q4 representing the high watermark for growth in rides, their highest level of annual rides in the company's history and bookings," says Needham analyst Bernie McTernan (Hold). As a result, the stock closed today up 35.1%.
Fellow ride-hailing firm Uber Technologies (UBER) also spiked today. UBER gained 14.7% after the company said its board of directors approved its first-ever stock buyback plan, authorizing up to $7 billion in share repurchases.
Robinhood pops on surprising Q4 profit
Robinhood Markets (HOOD) was another post-earnings winner, surging 13.0% after its results. The online trading platform posted an unexpected profit of 3 cents per share for its fourth quarter. The report also showed revenue surged 24% in the three-month period to a higher-than-expected $455 million.
Crypto trading, in particular, was a "bright spot," with crypto volumes coming in at their strongest since Q3 2022, says Needham analyst John Todaro. However, the analyst remains "Hold rated as we gauge the success of international products which could prove necessary to growing volume longer term."
As for the main indexes, the Nasdaq Composite rose 1.3% to 15,859, the S&P 500 added 1.0% to 5,000, and the Dow Jones Industrial Average gained 0.4% to 38,424.
Related content
- Kiplinger's Earnings Calendar for This Week
- Analysts' Top S&P 500 Stocks to Buy Now
- Is the Stock Market Open on Presidents' Day?
-
Stock Market Today: Stocks Grapple for Peace Trade GainsOf course dramatic tension is high on Fed Day, only this time it's about war and peace as well as monetary policy.
-
The Best Phone Deals from the Best Buy Android Savings EventSave up to $450 on a new phone from Samsung, Google and more at Best Buy
-
Stock Market Today: Stocks Grapple for Peace Trade Gains
Of course dramatic tension is high on Fed Day, only this time it's about war and peace as well as monetary policy.
-
Fewer Agents, Fewer Audits: How IRS Staff Cuts Are Changing EnforcementSignificant reductions in the IRS workforce appear to be increasing the number of 'no change' audit closures. The shift could potentially increase the overall tax gap — the difference between taxes that should have been paid and those that were.
-
What if You Could Increase Your Retirement Income by 50% to 75%? Here's HowCombining IRA investments, lifetime income annuities and a HECM into one plan could significantly increase your retirement income and liquid savings compared to traditional planning.
-
Here's Why You Shouldn't Do an Estate Plan Without a Financial PlannerEstate planning isn't just about distributing assets. Working with a financial adviser can ensure you've considered the big picture — and the finer details.
-
Stock Market Today: Rally Pauses for "Real End" to Middle East WarThe future is uncertain by nature, but it's hard to recall a time when views on what's next have been this volatile from day to day.
-
We Are Peter Lynch: How to Invest in What You KnowTake a look around, go to a free stock market data website, and get to work.
-
Trump Tariffs and Taxes: Waiting to See What Happens Is Not a StrategyLike presidents, tariffs come and go. Policy changes also shift about every two years with the election cycle. If you're paralyzed by uncertainty, you could be missing opportunities to benefit your financial future.
-
Is a Family Office Right for You? The Multimillion-Dollar QuestionAs ultra-high-net-worth individuals increase in number, many are turning to family offices to manage their complex finances. Here's how family offices work, courtesy of a finance professional.
