What Happened?

A number of stocks jumped in the afternoon session after investors grew more optimistic about a potential Federal Reserve interest rate cut in December. 

The positive sentiment was fueled by comments from New York Fed President John Williams, a voting member of the rate-setting Federal Open Market Committee, who stated the central bank could cut rates "in the near term" without jeopardizing its inflation targets. Following his remarks, market expectations for a rate cut in December shifted significantly. According to the CME FedWatch Tool, the probability of a December rate reduction surged from a 37% chance earlier in the day to 70%. While lower rates can compress bank profit margins, investors often view them as a catalyst for broader economic activity, potentially boosting loan demand and reducing the risk of defaults.

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:

• Investment Banking & Brokerage company Piper Sandler (NYSE: PIPR) jumped 2.7%. Is now the time to buy Piper Sandler? Access our full analysis report here, it’s free for active Edge members.
• Diversified Financial Services company Payoneer (NASDAQ: PAYO) jumped 2.7%. Is now the time to buy Payoneer? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Piper Sandler (PIPR)

Piper Sandler’s shares are somewhat volatile and have had 11 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 21 days ago when the stock gained 2.8% on the news that the company reported strong third-quarter 2025 results that surpassed analyst expectations for both earnings and revenue. The investment bank announced adjusted earnings per share of $3.82, beating consensus estimates of $3.27. Revenue was also a bright spot, coming in at $479.3 million against estimates of $436.7 million. This represented a 33.3% increase compared to the same period last year. The firm's pre-tax profit margin also showed significant improvement, expanding to 22.4%, which was 6.9 percentage points better than the same quarter last year. Overall, it was a solid quarter for the company, with significant beats on both the top and bottom lines.

Piper Sandler is up 8.6% since the beginning of the year, but at $325.18 per share, it is still trading 12% below its 52-week high of $369.40 from September 2025. Investors who bought $1,000 worth of Piper Sandler’s shares 5 years ago would now be looking at an investment worth $3,499.

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