Market News

Wall Street closed lower on Wednesday as investors assessed economic data and anticipated another interest rate cut from the Federal Reserve. Market participants also evaluated Q3 earnings results. The Nasdaq, the Dow, and the S&P 500 closed in negative territory.

How Did the Benchmarks Perform?

The Dow Jones Industrial Average (DJI) fell 0.2% or 91.51 points to close at 42,141.54. Eighteen components of the 30-stock index ended in negative territory, while 12 ended in positive.

The tech-heavy Nasdaq Composite declined 104.82 points or 0.6% to 18,607.93.

The S&P 500 lost 0.3%, or 19.25 points, to end at 5,813.67. Eight broad sectors of the benchmark index closed in the green, while three ended in the red. The Technology Select Sector SPDR (XLK), the Utilities Select Sector SPDR (XLU), and the Health Care Select Sector SPDR (XLV) fell 1.6%, 0.2%, and 0.2%, respectively.

The fear-gauge CBOE Volatility Index (VIX) increased 5.2% to 20.35. The S&P 500 posted 24 new 52-week highs and five new lows; the Nasdaq Composite recorded 126 new highs and 98 new lows.

U.S. Economy Shows Steady Growth Alongside Strong Job Gains

The economy of the United States showed a growth rate of 2.8 % for the third quarter, per a report from the Commerce Department released on Wednesday. This growth rate was slightly lower than the consensus estimates of 3.1% and followed a 3% increase in the previous quarter. Consumer spending, a driver of U.S. activity went up by 3.7 % in the third quarter, marking the highest rate since early 2023 and contributing significantly to GDP growth.

In addition to the GDP data, the labor market showed strength in October, with the U.S. private sector adding 233,000 jobs, far exceeding September's revised total of 159,000 and surpassing expectations of 113,000, according to ADP. This marks the highest level of job creation since July 2023.

The upcoming meeting of the Federal Reserve, on Nov. 7 is expected to result in another reduction in interest rates as the central bank continues its focus on boosting growth despite a slowdown, in inflation trends.

 Q3 Earnings Highlights

Alphabet Inc. GOOGL reported that in the third quarter of 2024, adjusted earnings were $2.12 per share, outpacing the Zacks Consensus Estimate of $1.83 per share. The technology holding company generated total revenues of $74.55 billion, beating the Zacks Consensus Estimate by 2.34%.

Garmin Ltd. GRMN reported third-quarter 2024 adjusted earnings of $1.99 per share, surpassing the Zacks Consensus Estimate of $1.46 per share. The wireless communications company generated total revenues of $1.59 billion, beating the Zacks Consensus Estimate by 9.81%.  

Snap Inc. SNAP reported third-quarter 2024 adjusted earnings of $0.08 per share, surpassing the Zacks Consensus Estimate of $0.05 per share. The technology company generated total revenues of $1.37 billion, beating the Zacks Consensus Estimate by 1.36%.

Consequently, the stock price of Alphabet, Garmin and Snap rose 2.8%, 23.3%, and 15.9%, respectively. Alphabet currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Economic Data

Per the National Association of Realtors, pending home sales for September increased 7.4%. The number for August remained at an unrevised increase of 0.6%.

For the week ended Oct. 25, U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 0.5 million barrels from the previous week.

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