Tuesday provided much-needed relief for hard-hit investors, as major benchmarks rebounded sharply from their losses over the past two sessions. The Dow was down more than 500 points at times during the day but finished with a 567-point gain, and other large benchmarks posted similarly sized increases of about 2%. Few are ready to declare the market's episode of volatility over, but some signs of capitulation among traders seemed to hearten longer-term investors as some indexes fell to levels that were 10% below their record highs before bouncing. Good news from individual companies also put market participants in a better mood. General Motors (NYSE:GM), TripAdvisor (NASDAQ:TRIP), and Oclaro (NASDAQ:OCLR) were among the best performers on the day. Below, we'll look more closely at these stocks to tell you why they did so well.
General Motors hits the gas
Shares of General Motors picked up 6% after the company released its fourth-quarter financial report. The automaker managed to overcome sluggish conditions that some of its peers had reported, closing what CEO Mary Barra called "a transformative year for GM" with record performance. Particularly notable were GM's efforts to grow in China and South America, progress on broader personal mobility efforts, and vision for electric vehicles in the next five years. Given that shareholders have been worried about how long General Motors could keep up its extremely strong pace of sales, the latest numbers once again showed GM's resiliency in the face of adversity.
TripAdvisor looks for a partner
TripAdvisor stock gained nearly 15% on continued speculation about the potential for the online travel specialist to attract a buyout bid. One analyst company boosted its price target on the stock by $3 per share to $37, but kept its hold rating on TripAdvisor despite mentioning the possibility of an acquirer surfacing. TripAdvisor's fundamental business has seen challenges recently, including competitive pressures and its failure to make the most of its launch of its direct-booking business. Nevertheless, consolidation in the industry would likely be a good thing, and so it's reasonable for TripAdvisor shareholders to hope for the simple exit strategy that a takeover would give them.
Oclaro's future gets clearer
Finally, shares of Oclaro soared 21%. The company was just one of several optical networking specialists to see sizable gains, rebounding from a terrible 2017 as market participants see greater potential for capital upgrades from customers in the coming year. Oclaro reported mixed numbers in its fiscal second-quarter earnings report Monday night, including a 9% drop in revenue and a 38% fall in net income. Yet CEO Greg Dougherty pointed to efforts to boost gross margin and cash flow. Although the current quarter could also be weak, Oclaro sees better conditions in the business by midyear, and investors are already factoring those high expectations into their forecasts.