Here Are 3 Hot Things to Know About Stocks Right Now

  • The Dow Jones Industrial Average and S&P 500 hit record closing highs Wednesday, propelled by a surge in Disney+ subscriptions.
  • Alphabet (GOOGL) - Get Report slipped after The Wall Street Journal reported that federal regulators started a probe into Google's 'Project Nightingale' cloud computing deal with Ascension Health. Alphabet is Real Money's Stock of the Day.
  • Nike (NKE) - Get Report and Amazon.com (AMZN) - Get Report are parting ways, with the shoe and apparel maker no longer selling directly on Amazon's website.

Wall Street Overview

The Dow Jones Industrial Average and S&P 500 hit record closing highs Wednesday, as a launch day surge in Disney (DIS) - Get Report streaming service subscriptions helped offset concerns about the U.S.-China trade war.

The Dow which also hit an intraday record high, finished up 92 points, or 0.33%, to 27,783.59, the S&P 500 rose 0.07% to 3,094, while the Nasdaq was down 0.05% to 8,482.

Disney was the Dow's and S&P's top gainer, following to a CNBC report that said the entertainment giant's highly-anticipated new streaming service, Disney+, has already reeled in more than 10 million subscribers since its launch on Tuesday.

Wedbush Securities analyst Dan Ives said in a note that the number of sign-ups is "considerably higher than we and many on the Street were anticipating."

Stocks were losing ground on news of a snag in U.S.-China trade negotiations. President Donald Trump has said China has agreed to buy up to $50 billion in U.S. soybeans, pork and other agricultural products annually, but China, Bloomberg reported, is leery of putting an exact number in the text of a potential agreement.

The Bloomberg story cited people familiar with the matter. Dow Jones also reported the "phase one" trade pact had hit a snag over purchases of agricultural products.


Equities had traded higher earlier in the session after Federal Reserve Chairman Jerome Powell told lawmakers that the central bank saw little need to cut interest rates further after making three reductions between July and October.

Powell started two days of testimony to U.S. lawmakers with an appearance before the Senate's Joint Economic Committee. Powell will address the House Budget Committee on Thursday.

"We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook of moderate economic growth, a strong labor market, and inflation near our symmetric 2% objective," Powell said in prepared remarks.

The Fed chairman also warned that the federal budget "is on an unsustainable path, with high and rising debt," Powell said. The U.S. treasury reported the October budget deficit was $134.5 billion, vs. $100.5 billion a year earlier. "Over time, this outlook could restrain fiscal policymakers' willingness or ability to support economic activity during a downturn," Powell said.

"We think the bias should be for the Fed to provide further stimulus to shore up an economic expansion that is beginning to look tired," Dev Kantesaria, founder and portfolio manager of Valley Forge Capital Management. "Downside risks to the economy appear to be far greater than concerns about exceeding the Fed's inflation target of 2%."

Trump's speech before the Economic Club of New York on Tuesday did little to ease investors' concerns about the ongoing trade war. Trump threatened "very substantial" tariffs on China-made goods if a deal isn't reached, raising the prospect that fresh levies on $175 billion worth of consumer goods will kick in on Dec. 15.

Alec Young, managing director of global markets research, FTSE Russell, said that "recent trade optimism seems overdone."

"Over the past week," he said, "stocks have surged as optimism that the December 15 tariffs would be delayed has morphed into broader expectations for the removal of all existing tariffs. Investors are getting ahead of themselves. President Trump has pushed back on this expectation, reflecting the hawkish view of many of his key trade advisers."

In addition, Congress began its first public impeachment hearing in more than 20 years on Wednesday, looking into allegations that Trump witheld previously approved military aid to Ukraine to force the country's new president to start an investigation into Hunter Biden, son of the former vice president and current Democratic presidential hopeful Joe Biden.

Alphabet (GOOGL) - Get Report dipped slightly to $1,296.18 after The Wall Street Journal reported that federal regulators have started a probe into Google's 'Project Nightingale' cloud computing deal with Ascension Health. Alphabet is Real Money's Stock of the Day.

Nike (NKE) - Get Report and Amazon.com (AMZN) - Get Report are parting ways, with the shoe and apparel maker no longer selling directly on Amazon's website. Nike was up 2% to $91.29, while Amazon was off 1.4% to $1,753.11.

Apple (AAPL) - Get Report shares were up nearly 1% to $264.47 following a bullish note from RBC Capital Markets that initiated coverage on Apple shares with an outperform rating and $295 price target.

The consumer price index increased 0.4% last month, the Labor Department said, while economists had forecast the CPI advancing 0.3% in October. In the 12 months through October, the CPI has increased 1.8%.

"Despite the mixed reading this will likely keep the Fed on the sidelines, as Powell telegraphed when they last raised rates, which is likely the last time for a while," said Mike Loewengart, vice president of investment strategy at E*Trade. "And when you take out food and energy, which was a significant bump, we're right on track with expectations."

Alphabet, Apple, Cisco, Disney, and Amazon are holdings in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells these stocks? Learn more now.