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Markets Cool, FedEx & Rivian Post Quarterly Numbers

FedEx swings to a positive year-to-date while Rivian gives back some of its gains from its IPO.

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This story originally appeared on Zacks

For the second time this week, hopeful pre-market activity riding indexes into the green giving way to selling-off at varying points in the regular trading session. The Dow, which had kept some of its gains almost all the way through, dipped in the final minutes, finishing at -0.09% on the day. It had been +262 points at its high, and ended -31. The S&P 500 dropped -0.88%, or 41 points. This had been the index closest to posting fresh all-time highs, but is now about -1% off.

The Nasdaq was the biggest loser today, -385 points or -2.47% — its worst single trading day since September. The tech-heavy index is now more than 6% off its all-time highs set just a matter of weeks ago. The small-cap Russell 2000 came in -1.95% on the day. For both the Nasdaq and Russell, as well as the S&P, indexes have closed down in three out of the past four sessions.

Tech stocks dipped another -3% Thursday, which accounts for the Nasdaq’s outsized losses today. But semiconductors have largely been resilient here, which means software companies are likely taking the brunt of losses for now. Even Microsoft MSFT, the biggest software company in the world with plenty of other income streams available, lost -3% on the day. That said, we advise tracking some highly ranked software firms caught up in today’s activity. Salesforce.com CRM is a Zacks Rank #1 (Strong Buy) and dropped -2.6% today; Magic Software Enterprises MGIC is a Zacks Rank #2 (Buy) and fell -1% on the day.

After market close, transportation, delivery and logistics giant FedEx FDX posted better-than-expected results on both top and bottom lines for its fiscal Q2: $4.83 per share on $23.5 billion in the quarter easily outpaced the $4.23 per share and $22.53 billion estimated, respectively. The company’s operating income grew +9%, and a share buyback program worth $5 billion both helped FDX shares bounce +8% on the news — swinging FedEx to positive for the year.

This was also due to a nice hike in earnings guidance for the full-year of between $20.50-21.50 per share, up from the $19.49 per share in the Zacks consensus. And why this may be good news for Q4 earnings season is that, as an outlier in reporting as well as a representative of travel and supply chain sectors of the economy, FedEx may be helping pave the way for higher expectations when Q4 earnings begin in earnest mid-January.

EV startup Rivian RIVN posted its first quarterly statement since its IPO last month, with Q4 results mixed from expectations (which are understandably difficult to nail so early into its publicly traded existence): -$12.21 per share was beneath the -$11.92 Zacks consensus. Revenues came in slightly above estimates at $1 million (the company has only begun selling vehicles).

At this stage for Rivian, profits are a ways off but growth is key: so far, the EV maker has produced 652 vehicles, with 386 delivered. It currently has a plant in Normal, IL and plans to build an even bigger one in Georgia, southeast of Atlanta. That plant is expected to open in 2024 and make 400K vehicles per year and hire 1700 employees. That said, shares are -3.5% on the Q4 release, after having gained roughly +35% from its initial share price.

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