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Key Takeaways
- The S&P 500 added 1.3% on Thursday, Feb. 1, 2024, with strong earnings helping stocks recover after Wednesday’s Fed meeting suggested an uncertain path ahead.
- Activity by activist investors helped shares of Etsy Inc. and Norfolk Southern Corp. post solid gains.
- Shares of Zions Bancorporation and other regional lenders moved lower amid renewed concerns about the health of the banking industry.
Major U.S. equities indexes advanced on Thursday, changing course from declines the previous day after the Federal Reserve held interest rates steady and suggested an uncertain path toward widely anticipated rate cuts. Earnings reports remained in focus, with three of the “Magnificent Seven” tech firms set to release results Thursday afternoon.
The S&P 500 and the Nasdaq both closed the session roughly 1.3% higher, while the Dow posted a gain of 1.0%.
Corteva Inc. (CTVA), which provides seeds and crop protection products to agricultural markets, led the S&P 500 higher. Its shares skyrocketed 18.9% on Thursday after Corteva reported better-than-expected fourth-quarter sales and profits, provided guidance for sales growth in 2024, and disclosed plans to repurchase around $1 billion in shares. Shares of fellow agricultural firm FMC Corp. (FMC), which is due to release results next week, gained 10.6% following Corteva’s report.
Shares of Norfolk Southern Corp. (NSC) advanced 9.1% following reports that an activist investor group led by Ancora Holdings has acquired a stake of about $1 billion in the railroad company. The investor group aims to replace Norfolk Southern’s current chief executive officer (CEO) amid a challenging environment for the freight rail industry.
Norfolk Southern was not the only stock to get a boost following activity by activist investors. Shares of Etsy Inc. (ETSY) also jumped 9.1% after the online crafts marketplace announced the appointment of Elliott Management partner Marc Steinberg to its board of directors. The activist investor firm Elliott has accumulated a significant stake in Etsy and aims to help accelerate growth by improving the Etsy customer experience.
C.H. Robinson Worldwide Inc. (CHRW) shares posted Thursday’s steepest losses on the S&P 500, plunging 12.6% after the logistics company missed analysts’ estimates with its fourth-quarter sales and profits results. Declining freight demand, excess capacity, and supply-chain complications had a negative impact on the company’s performance.
Shares of insurance giant Aflac Inc. (AFL) tumbled 9.7% after it posted weaker-than-expected fourth-quarter sales and profit numbers. Softness in the Japan market weighed on Aflac’s results. Fellow insurer MetLife Inc. (MET) missed bottom-line estimates as its net income declined year over year, and its shares dropped 5.7%.
Shares of Zions Bancorporation (ZION) fell 6.3%, and other regional bank stocks moved lower, a day after New York Community Bancorp Inc. (NYCB) reported a loss and reduced its dividend. While NYCB’s struggles related to its commercial real estate portfolio may be unique to the firm, the report renewed concerns about the overall health of regional lenders after turmoil in the sector last year. The SPDR S&P Regional Banking ETF (KRE) dropped 3.1% on Thursday.