Stock Market Today: Stocks Higher Amid Nike, FedEx Earnings Beats

Stocks rise as Nike soars following a second-quarter earnings win and an optimistic outlook, while FedEx leaps as cost-cuts drive an earnings beat.

Stocks were rising Wednesday as investors looked to extend the previous session's modest advance into an end-of-year rally despite persistent recession concerns and a hawkish Federal Reserve.

At last check the Dow Jones Industrial Average surged 527 points, or 1.61%, to 33,377, while the S&P 500 rose 1.49%. The tech-focused Nasdaq Composite gained 1.53%.

Better-than-expected second-quarter earnings from Nike  (NKE) - Get Free Report and FedEx  (FDX) - Get Free Report after the close of trading Tuesday added to the market's improved sentiment. 

So did a pullback in Treasury bond yields following Tuesday's surprise move by the Bank of Japan to widen the trading band on 10-year government bonds as it slowly shifts its broader policy stance from growth stimulus to inflation fighting. 

In economic news, U,S.existing-home sales fell 7.7% to a seasonally adjusted annual rate of 4.09 million units last month, the lowest level since May 2020, the National Association of Realtors said. 

Sales have now declined for 10 straight months, the longest such stretch since 1999.

Nike: Record Black Friday Demand a Driver

Nike shares soared 13.3% after the sportswear giant posted stronger-than-expected fiscal-second-quarter earnings

Record Black Friday demand, powered in part by price cuts and discounting, drove overall sales 17.1% higher to a Wall Street-beating $13.3 billion. 

Nike's bottom line was pegged at 85 cents a share, well ahead of forecasts, although higher input costs, discounts and a stronger dollar pressured profit margins, which narrowed 3 percentage points to 42.9%.

Inventories remained elevated but eased by $400 million on a sequential basis to around $9.3 billion.

"We believe the inventory peak is behind us as actions we're taking in the marketplace are working," said Chief Executive John Donahoe in a statement. "Overall, our Q2 results give us confidence that we will deliver the year, and we remain on a path toward our long-term goals as well."

FedEx: Deeper Cost Cuts Are Outlined

FedEx shares rose 4.1% after the world's biggest package-delivery company unveiled stronger-than-expected fiscal-second-quarter earnings and outlined deeper cost cuts heading into the coming year.

FedEx said it would add another $1 billion in cost savings to its already-established $2.7 billion program, as it reduces FedEx Express flights and parks as many as eight planes. It also cut back on Sunday deliveries and closed some domestic sorting warehouses.

For the three months ended in November, FedEx earnings came in at $3.07 a share, well ahead of Wall Street forecasts, Revenue was light, however, at $22.8 billion down 2.9% from a year earlier  and missing Wall Street's estimate of $23.7 billion.

"We will continue to provide updates on our (Drive cost-cutting plan) progress, and we plan to host a Drive deep-dive call in the first half of calendar 2023 to provide additional details on our ongoing transformation," CEO Raj Subramaniam told investors on a conference call. 

Musk Says He'll Step Down as Twitter CEO

Elon Musk said he would step down as CEO of Twitter, the social media company he bought earlier this year for around $44 billion, but not until he is able to find a suitable replacement.

Musk, who polled his 122 million Twitter followers over the weekend as to whether he should remain as group CEO or step aside, said he would resign as CEO as soon "as I find someone foolish enough to take the job! After that, I will just run the software & servers teams."

The confirmation of Musk's plans, should they materialize, will likely provide some relief for Tesla TSLA shareholders, which watched the stock fall another 8% Tuesday to close at a fresh two-year low of $137.80 each. Tesla was up 1% to $139.29 in early trading.

Musk closed his purchase of Twitter in late October, and has been active on both the platform and in the company's San Francisco headquarters ever since. He's been managing a controversial series of layoffs, content rules and suspensions, including barring several prominent journalists whom he accused of tracking and reporting his location via the movements of his private jet.

NBA Phoenix Suns to Change Ownership

United Wholesale Mortgage CEO Mat Ishbia agreed terms with Robert Starver and the Phoenix Suns late Tuesday that will see him and his brother become majority owners of the NBA franchise in a deal that values the group at a record $4 billion.

Ishbia and his brother Justin, a private equity specialist, will also buy the Suns' affiliated WNBA franchise -- the Phoenix Mercury -- as part of the deal, the pair said. The purchase, which requires approval from the National Basketball Association's owners group, followed the suspension of Starver earlier this year after an investigation into workplace harassment.

"Mat is the right leader to build on franchise legacies of winning and community support and shepherd the Suns and Mercury into the next era," Sarver said in a statement.

U.S. sports franchises have soared in value over the past five years, with the Brooklyn Nets valued at $2.35 billion following a deal that saw Joe Tsai buy out his ownership partners in 2019 and the sale of the Houston Rockets to billionaire investor Tilman Fertitta for $2.2 billion in 2017.

The pending sale of the NFL's Denver Broncos values the three-time Super Bowl champs at $4.65 billion while hedge fund billionaire David Tepper paid $2.275 billion for the Carolina Panthers in 2018.