Shares ended Monday with solid gains as Elon Musk’s investment in Twitter provided a boost to tech stocks. Overall, Wall Street is still looking for direction after the late March recovery lost momentum.
Online retailers were among the beneficiaries of Monday’s rally. Hopes that consumers will continue to buy despite inflation and higher interest rates led to gains in stocks such as Carvana (CVNA), Chewy (CHWY), Poshmark (POSH) and Farfetch (FTCH).
Jumia (JMIA) was another standout winner of the session, supported by a partnership with UPS (UPS). Meanwhile, RCM Technologies (RCMT) extended its recent earnings-inspired rally with another double-digit percentage gain, hitting a fresh 52-week high.
On the other side of the ledger is Donald Trump-affiliated SPAC Digital World Acquisition (NASDAQ:DWAC) lost ground amid reports that the former president’s company Truth Social has lost two senior executives.
Elsewhere, community and regional banks continued to suffer from selling pressure. As a result, Timberland Bancorp (TSBK) and Northfield Bancorp (NFBK) made fresh 52-week lows.
sector in focus
Investors rushed into shares of online retailers amid signs that consumer spending has held up despite headwinds from things like rising interest rates, inflation and geopolitical tensions.
On Monday, the sector received a boost from Deutsche Bank analyst Jim Reid, who argued that strong consumer balance sheets would “foam the runway of any slowdown.” In particular, he pointed to the high consumer savings that have been built up during the pandemic.
As investors remain bullish on the industry, several high-profile players in the sector posted notable gains. Carvana (CVNA) is up more than 11%, while Chewy (CHWY) is up almost 12%. Poshmark (POSH) and Farfetch (FTCH) are both up more than 9%.
Africa-focused logistics company Jumia (JMIA) rose nearly 25% after announcing a partnership with parcel delivery giant United Parcel Service (UPS).
Under the terms of the agreement, JMIA will provide last-mile logistics for UPS delivery in Africa. The cooperation will initially focus on the countries of Kenya, Morocco and Nigeria and is to be extended to Ghana and the Ivory Coast.
In the longer term, the partnership could expand to the remaining countries served by JMIA.
JMIA closed at $11.82, gaining $2.33 during the session. Monday’s surge added to gains posted over the past few weeks, sending the stock further down from a 52-week low of $6.41 set in mid-March.
Shares are up about 84% since hitting that low. Still, the stock remains a long way off its 52-week high of $40.37 set last April. Meanwhile, JMIA peaked above $60 in early 2021.
Digital World Acquisition (DWAC), the SPAC that is set to take Donald Trump’s media company public, fell nearly 10% after reports of the loss of two executives. Meanwhile, Elon Musk’s investment in Twitter also clouded prospects for a new player in the social media sector.
According to Reuters, Truth Social, the former president’s new media company, has lost its head of technology and its head of product development. Both had resigned from their posts, the report said, citing people familiar with the matter.
On the news, DWAC fell $6.31 to close at $56.94. The stock has trended lower over the past month, losing about 32% in that time. Stocks also hit their lowest level since the first half of January.
Notable new high
Spurred by a strong earnings report released mid-last week, RCM Technologies (RCMT) continued its recent upleg on Monday, posting its third consecutive session of double-digit percentage gains. Shares climbed almost 15% to hit another 52-week high.
RCMT climbed $1.64 to close at $12.59. This contributed to a 15% gain last Thursday and a subsequent 11% gain during Friday’s trading.
With Monday’s advance, RCMT hit a 52-week intraday high of $12.70. The stock is now up about 47% over the past three sessions.
The latest jump followed a blockbuster earnings report. The information technology and engineering services provider reported a profit for its most recent quarter versus a loss reported in the same period last year. At the same time, sales increased by almost 58%.
Notable new low
Municipal and regional banks have come under further pressure in recent weeks amid ongoing concerns about an inverted yield curve affecting banks’ ability to generate profits.
That process continued on Monday, with Timberland Bancorp (TSBK) and Northfield Bancorp (NFBK), among others, slipping to fresh 52-week lows.
Washington-based TSBK fell 3% during the session to close the day at $26.16. This contributed to the recent drop, with the stock posting its seventh straight lower end. The shares also established a fresh 52-week intraday low of $26.
At the same time, New York-based NFBK fell 2% during the session. The stock posted a 52-week intraday low of $14.06 before ending the day at $14.11.
NFBK has lost ground since hitting a 52-week high of $18.41 in November. The stock is down about 24% since that peak.
For more on Wall Street’s biggest movers, see the On The Move section of Seeking Alpha.