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Tech Stocks Fade As Fed Raises Rates; Netflix Bucks Trend, Leads FANG Stocks

Tech stocks were in favor for most of Wednesday's session as the Nasdaq composite marked another all-time closing high. But a 0.6% intraday gain faded by the close. The Federal Reserve, as expected, hiked its key lending rate by a quarter point to a range of 1.75% to 2%. After today's hike, it sees two more for the rest of the year, although futures traders aren't so sure. According to the CME Group FedWatch tool, futures traders only see a 47% chance of a fourth rate hike at the December meeting.

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Top-performing tech stocks in the Nasdaq 100 included Leaderboard name Netflix (NFLX). Video game makers Electronic Arts (EA) and Take-Two Interactive (TTWO) also outperformed. So did media stocks like 21st Century Fox (FOX) and Dish Network (DISH) after the AT&T (T)/Time Warner (TWX) merger was approved without conditions late Tuesday.

Shares of Comcast (CMCSA) fell slightly ahead of news it's bidding $65 billion for 21st Century Fox. Dow component Walt Disney (DIS) is another suitor of 21st Century Fox. Shares of Disney reversed higher in the Dow after falling 1.6% intraday.

At the close, the Nasdaq was down 0.1%, the Dow Jones industrial average lost 0.5% and the S&P 500 gave back 0.4%. Preliminary data showed volume on the NYSE and Nasdaq coming in slightly higher than Tuesday's levels.

Tech Stocks On The Move

On the earnings front, Pivotal Software (PVTL) was one of the best performing tech stocks, rising 33%. A strong earnings report fueled gains. The enterprise software name isn't profitable yet, but sales have been impressive in recent quarters. In the latest quarter, sales growth accelerated for the second straight quarter, rising 28% to $155.7 million.

Group peer and IBD 50 name Paycom Software (PAYC) scored its fourth straight gain, rising 1% to 111.72. Its current consolidation shows a 118.55 buy point.

Also in the IBD 50, Palo Alto Networks (PANW) extended gains after a heavy-volume bounce off the 50-day moving average Tuesday. Shares rose another 2.7% Wednesday.

Meanwhile, a recent breakout from a double-bottom base for Grubhub (GRUB) gained more traction Wednesday. It gained for the second straight session in heavy volume, rising 2.8%.

Interest-rate sensitive homebuilders lagged badly Wednesday, with the group as a whole down more than 3%.

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