What Happened?
A number of stocks jumped in the afternoon session after the major indices rebounded, as Fed Chair Jerome Powell delivered dovish remarks at the much-awaited Jackson Hole symposium. Powell suggested that with inflation risks moderating and unemployment remaining low, the Federal Reserve might consider a shift in its monetary policy stance, including potential interest rate cuts. This outlook eased market concerns about prolonged high interest rates and their impact on economic growth. The prospect of lower borrowing costs bolstered investor confidence, particularly in sectors that have lagged, leading to a broad rally across the market.
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:
- Drug Development Inputs & Services company Repligen (NASDAQ: RGEN) jumped 4.9%. Is now the time to buy Repligen? Access our full analysis report here, it’s free.
- Research Tools & Consumables company Revvity (NYSE: RVTY) jumped 5.2%. Is now the time to buy Revvity? Access our full analysis report here, it’s free.
- Research Tools & Consumables company Avantor (NYSE: AVTR) jumped 5.5%. Is now the time to buy Avantor? Access our full analysis report here, it’s free.
- Drug Development Inputs & Services company Fortrea (NASDAQ: FTRE) jumped 7.7%. Is now the time to buy Fortrea? Access our full analysis report here, it’s free.
- Drug Development Inputs & Services company Azenta (NASDAQ: AZTA) jumped 6.2%. Is now the time to buy Azenta? Access our full analysis report here, it’s free.
Zooming In On Fortrea (FTRE)
Fortrea’s shares are extremely volatile and have had 59 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 1 day ago when the stock dropped 3% on the news that markets continued to decline, as investors grew cautious ahead of a key speech by Federal Reserve Chair Jerome Powell. The move came as U.S. equity markets recorded a fifth consecutive day of losses for major indexes like the S&P 500, with technology stocks experiencing the largest declines. Investors have grown wary that the sharp rally in the tech sector since April may have advanced too far. The market-wide caution is largely driven by the upcoming Jackson Hole symposium, a meeting of central bankers, where traders are anxiously awaiting Fed Chair Powell's speech on Friday for guidance on the future path of interest rates.
Fortrea is down 55.3% since the beginning of the year, and at $8.34 per share, it is trading 65.1% below its 52-week high of $23.90 from September 2024. Investors who bought $1,000 worth of Fortrea’s shares at the IPO in June 2023 would now be looking at an investment worth $277.18.
Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we’ve identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link.
