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Wall Street Opens Higher; Amazon, Alphabet Lift Nasdaq

Stock MarketsFeb 03, 2021 14:44
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By Geoffrey Smith -- U.S. stock markets opened mostly higher on Wednesday as strong earnings from Amazon (NASDAQ:AMZN) and Google owner Alphabet (NASDAQ:GOOGL) revived faith in the growth narrative around technology stocks, while the hotly-traded meme stocks of last week continued to bubble in the background.

By 9:40 AM ET (1440 GMT), the Nasdaq Composite was up 55 points, or 0.4%, while the S&P 500 was up 0.2%. The Dow Jones Industrial Average, meanwhile, underperformed with a loss of 31 points, or 0.1%, to 30,656 points. 

Alphabet (NASDAQ:GOOGL) stock was up 6.4% after the company recorded a banner quarter for Internet advertising through its search and YouTube platforms. Amazon (NASDAQ:AMZN) stock was flat, as blowout earnings and revenue in the fourth quarter were overshadowed by the announcement late on Tuesday that founder Jeff Bezos will step down as chief executive, to be succeeded by Andy Jassy, head of Amazon's cloud-hosting unit. The decision was taken by some as potentially signaling a shift away from the group's e-commerce roots. 

It wasn't all one-way traffic in tech, however. Spotify (NYSE:SPOT) stock fell 8.1% after a disappointing quarterly update, while Tesla (NASDAQ:TSLA) slipped 0.5%, still weighed on by the biggest safety recall in its short history, which affects over 150,000 vehicles. 

Elsewhere, the battle between retail investor bulls and Wall Street short sellers continued to bubble over, with the handful of heavily-shorted 'meme stocks' largely rising in early trade after losses of as much as 60% on Tuesday.

GameStop (NYSE:GME) stock was up 6.7%, stall well above its historic 2007 record high, while AMC Entertainment (NYSE:AMC) stock was up 6.3%. Koss stock was the standout name, as the maker of speakers and headsets gained just under 40%. They and others appeared to weaken as the early buy orders fizzled out. BlackBerry (NYSE:BB) stock was the first to turn red, losing 0.5%.

Earlier, the market had had a boost from payrolls processor ADP (NASDAQ:ADP), which said that private-sector employment had risen by 174,000 in the month through mid-January - more than three times as many as the 49,000 expected. December's figures were also revised to show a much smaller fall in employment than originally reported. The figures prime the market for an upside surprise when the official labor market report is released on Friday.

Oil and gas stocks were largely supported by the signs of unity coming out of a regular ministerial meeting of OPEC and their allies. The bloc's output restraint has whittled away global stockpiles to a point that the world market is fast approaching OPEC's shorthand definition of balance. World oil stocks are set to hit their five-year average by June, the group's technical committee said on Tuesday. Chevron (NYSE:CVX) stock rose 1.7% and Exxon Mobil (NYSE:XOM) stock rose 2.5%, shrugging off concerns voiced by Mizuho, whose analysts said the group needs an average oil price of $60 a barrel to meet both its capex and dividend outlays. 

Wall Street Opens Higher; Amazon, Alphabet Lift Nasdaq

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