What Happened?
A number of stocks jumped in the afternoon session after positive news on corporate earnings, easing political and trade tensions, and optimism about future interest rate cuts all converged to lift investor sentiment.
The overall market, including the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite, climbed significantly. A major catalyst was Apple shares rising 4% after a firm upgraded its rating, citing improving iPhone demand and predicting a long growth cycle. More broadly, the third-quarter earnings season got off to a strong start, with 76% of the 58 S&P 500 companies beating expectations, lifting the market's mood. Additionally, there were hope for an end to the ongoing U.S. government shutdown, which is seen as good for the economy. Investors also moved past recent fears over credit risks that had caused a sell-off the previous week, with shares of regional banks rebounding. Finally, signs that trade tensions with China were de-escalating, including expectations that new tariffs might be avoided, added to the overall positive momentum, leading traders to focus on more favorable factors like earnings and potential Federal Reserve rate cuts.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- HVAC and Water Systems company AAON (NASDAQ: AAON) jumped 3.7%. Is now the time to buy AAON? Access our full analysis report here, it’s free for active Edge members.
- Engineered Components and Systems company Regal Rexnord (NYSE: RRX) jumped 3.7%. Is now the time to buy Regal Rexnord? Access our full analysis report here, it’s free for active Edge members.
- Ground Transportation company RXO (NYSE: RXO) jumped 4.8%. Is now the time to buy RXO? Access our full analysis report here, it’s free for active Edge members.
- Ground Transportation company Universal Logistics (NASDAQ: ULH) jumped 3.8%. Is now the time to buy Universal Logistics? Access our full analysis report here, it’s free for active Edge members.
- Construction and Maintenance Services company Tutor Perini (NYSE: TPC) jumped 5.3%. Is now the time to buy Tutor Perini? Access our full analysis report here, it’s free for active Edge members.
Zooming In On Tutor Perini (TPC)
Tutor Perini’s shares are very volatile and have had 24 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 3.6% on the news that a softened tone from President Donald Trump on U.S.-China relations boosted investor sentiment. The positive shift followed a weekend post on Truth Social where Trump stated, "Don't worry about China, it will all be fine!" and expressed a desire to help rather than hurt the country's economy. This statement provided significant relief to markets that had ended the prior week with steep losses. In response, the Nasdaq Composite jumped 2.2%, the S&P 500 gained 1.6%, and the Dow Jones Industrial Average closed 1.3% higher, as investors' fears of escalating trade tensions subsided.
Tutor Perini is up 178% since the beginning of the year, and at $67.11 per share, has set a new 52-week high. Investors who bought $1,000 worth of Tutor Perini’s shares 5 years ago would now be looking at an investment worth $4,906.
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