By Yasin Ebrahim
Investing.com – The Dow weaved between gains and losses Wednesday, but remained close to record highs as investors continued to digest the latest quarterly results from corporates and ongoing efforts on Capitol Hill concerning the next round of stimulus.
The Dow Jones Industrial Average rose 0.14%, or 44 points. The S&P 500 was down 0.06%, while the Nasdaq Composite slipped 0.16%
Consumer discretionary stocks led the decline in the broader market with General Motors among the biggest decliners after its better-than-expected fourth-quarter results were offset by worries over rising costs amid an ongoing chip shortage.
General Motors (NYSE:GM) said the chip shortage that has plagued electric vehicle automakers across the industry would cost the company $1.5 billion to $2 billion this year, sending its shares 3% lower.
LYFT (NASDAQ:LYFT) reported fourth-quarter results that topped Wall Street's estimates and said it remained on track to become EBITDA profitable by the fourth quarter. It shares were up more than 5%.
Twitter (NYSE:TWTR), meanwhile, helped pare losses in the wider tech sector after the social media giant rallied 8% on better-than-expected fourth-quarter results.
The beat on the bottom line for Twitter was driven by a "global rebound in advertising, primarily from brand advertisers, which make up most of the company’s revenue and expressed greater demand for displaying digital ads to Twitter’s larger audience as events and product launches returned," Wedbush said.
Energy stocks were pushed higher by rising oil prices as data showing an expectedly weekly drop in U.S. crude supplies continued to support investor expectations that the supply-demand tightening in oil will continue ahead of an anticipated jump in fuel demand as the economies reopen.
Crude inventories fell 6.64 million barrels last week, compared with analysts' expectations for a build of 985,000 barrels.
The topsy-turvy session on Wall Street comes ahead of an update from Federal Reserve chairman Jerome Powell on the labor market in a webinar at 2:00 PM ET (1900 GMT).
Powell has previously indicated that would allow the labor market to run hot and inflation to move above its 2% target for some time, underpinning market expectations the central bank is in no rush to tighten monetary policy.
In other news, cannabis stocks including Canopy Growth (TSX:WEED), Aphria (TSX:APHA) and Tilray (NASDAQ:TLRY) on a Reddit-led wave of buying as retail traders bet on the Biden administration legalizing marijuana.
Yet analysts on Wall Street called for caution, particularly on Canopy Growth, which has more than doubled since the start of the year.
"We do not view the risk/reward as attractive on a fundamental basis for CGC shares at these levels to allocate new money. However, retail investor enthusiasm could remain a positive driver for shares near term," Oppenheimer said in a note.