Plus, Uber and Lyft shares are up after California voted to pass Proposition 22, ADP reported a sharp deceleration on private payroll additions in October, and Hilton reported improved earnings.
Stocks were higher to start Wednesday with the Dow adding 560 points, or 2%. The S&P 500 gained 2.3%, while the Nasdaq rose 3.2%.
Undecided. It’s the day after Election Day, and there is still no winner between President Donald Trump and former Vice President Joe Biden. As results continue to trickle in, Biden is ahead though several states still remain uncalled. Trump attempted to claim victory last night with millions of legitimate votes still outstanding and while behind in the electoral college. While Democrats have retained power in the House, their path to clinching victory in the Senate has narrowed with just seven seats remaining up for grabs. Final results could take days, or even weeks.
Shares of major tech stocks, including Apple, Amazon, Facebook, Microsoft, Netflix, and Google-parent Alphabet, rose this morning while the U.S. awaited for a clear presidential winner. Investors attributed the move to the possibility that Congress remains divided, which would make sweeping legislation against Big Tech harder to pass. Also up big this morning are Uber and Lyft after California voters decided both companies should be exempt from a labor law that aimed to make drivers employees instead of independent contractors in passing the Proposition 22 ballot measure.
The U.S. recorded its second-highest single-day new coronavirus cases reading on Tuesday with the country reporting another 91,500 cases. The seven-day average of daily new cases now stands at 86,362, 20% higher than last week’s average. In vaccine news, across the pond, the University of Oxford said it hopes to present late-stage trial results on its COVID-19 developed in partnership with AstraZeneca this year, raising hopes that a successful vaccine could be rolled out in late December or early 2021. The Oxford-AstraZeneca vaccine is expected to be one of the first from big pharma to be submitted for regulatory approval, along with Pfizer and BioNTech’s vaccine candidate. “If i put on my rose-tinted specs, I would hope that we will see positive interim data from both Oxford and from Pfizer/BioNTech in early December and if we get that then I think we have got the possibility of deploying by the year-end,” said Kate Bingham, chair of the UK Vaccine Taskforce.
ADP reported that private job creation showed a sharp deceleration in October as the U.S. economy struggled against rising coronavirus cases. Companies added just 365,000 jobs last month, the lowest reported gain from ADP since July and well below the 600,000 expected by economists. “The labor market continues to add jobs, yet at a slower pace,” Ahu Yildirmaz, vice president and co-head of the ADP Research Institute, said in a statement. “Although the pace is slower, we’ve seen employment gains across all industries and sizes.”Elsewhere, U.S. service industries grew at the slowest pace in five months in October, according to the Institute for Supply Management’s services index. The ISM services index declined to 56.6 during the month from 57.8 in September, indicating more moderate growth in the biggest part of the U.S. economy. While still at a healthy level, the index shows less momentum in services industries including leisure and hospitality, dining, and travel as growing coronavirus cases and the rising possibility for tighter restrictions on businesses put pressure on the sector. “Respondents’ comments are cautiously optimistic about business conditions and the economy,” Anthony Nieves, chair of the ISM Services Business Committee, said in a statement. “There is a degree of uncertainty due to the pandemic, capacity constraints, logistics and the elections.”
And on the earnings front, Hilton reported a third-quarter loss of $0.28 per share, an improvement from the second quarter’s loss of $1.55 per share. Hilton posted third quarter revenue of $933 million, down sharply from the $2.4 billion reported in the same quarter last year as lodging companies continue to face strong headwinds amid the ongoing coronavirus pandemic. ”The vast majority of our properties around the world are now open and have gradually begun to recover from the limitations that the COVID-19 pandemic has imposed on the travel industry, with occupancy increasing more than 20 percentage points from the second quarter,” Hilton Worldwide president and CEO Christopher J. Nassetta said in a statement. “While a full recovery will take time, we are well positioned to capture rising demand and execute on growth opportunities.”
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Collectors Universe (NASDAQ: CLCT): Collectors Universe shares gained as much as 20% yesterday after the collectibles company announced fiscal first quarter earnings results. The company posted revenues up 52% year-over-year to $30.8 million. “We achieved another quarter of record performance with revenue increasing over 50% both sequentially and year-over-year to $30.8 million, primarily driven by significant growth in our PSA division for trading cards, autographs and sports memorabilia,” said Joseph J. Orlando, President and CEO of Collectors Universe, in a statement. “Additionally, we set new quarterly records on both earnings and cash generation, further highlighting the improving operating leverage in our business. These results are a direct reflection of the diligent work by our team over the past few years to transform the business in a way that could enable the kind of growth we achieved in the first quarter of fiscal 2021.”