U.S. stocks jumped for a second straight session on Wednesday, but remained on pace for big losses in the month of October with corporate earnings season in full swing. All told, the Dow Jones Industrial Average (DJINDICES:^DJI) tacked on 1% this Halloween, while the S&P 500 (SNPINDEX:^GSPC) added 1.1%.
Today's stock market
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Tech stocks set the pace for today's gainers, with the Technology Select Sector SPDR Fund (NYSEMKT:XLK) jumping 2.4%. But retailers were largely excluded from the rally, with the SPDR S&P Retail ETF (NYSEMKT:XRT) down 1.4%.
As for individual stocks, positive earnings news drove outsize gains for both Facebook (NASDAQ:FB) and eBay (NASDAQ:EBAY). Read on to learn more about how the two tech giants kicked off the second half of the year.
Investors like Facebook's candor
Shares of Facebook jumped 3.8% -- a big move for the $440 billion social media juggernaut -- after the company posted strong third-quarter earnings and gave an encouraging preview of its longer-term plans.
Facebook's revenue climbed 33% year over year to $13.73 billion, which technically fell just short of analysts' consensus estimates for $13.78 billion. But that translated to net income of $5.14 billion, or $1.76 per share, up 11% year over year and trouncing Wall Street's average prediction for earnings of $1.47 per share.
"Our community and business continue to grow quickly, and now more than 2 billion people use at least one of our services every day," stated CEO Mark Zuckerberg. "We're building the best services for private messaging and stories, and there are huge opportunities ahead in video and commerce as well."
During the subsequent conference call, Zuckerberg admitted 2018 has been a "tough" year, and further told analysts to expect Facebook to continue making aggressive investments in both security and new products to drive engagement and longer-term growth. At the same time, Zuckerberg also suggested the company will strive to "make sure our costs and revenue are better matched over time."
eBay shifts its focus
eBay stock popped 5.9% after the online marketplace posted mixed third-quarter report. Revenue climbed 6% year over year to $2.65 billion, near the low end of its guidance provided three months ago. Adjusted earnings, however, grew 8% to $554 million, or $0.56 per share, near the high end of expectations.
Top-line growth was driven by a 5% increase in eBay's marketplace gross merchandise volume (GMV) to $21.5 billion, which drove a 6% gain in marketplace platform revenue to $2.1 billion. But eBay's StubHub and classifieds businesses also performed admirably, driving revenue increases of 7% (to $291 million) and 8% (to $254 million), respectively.
eBay management also revealed early progress expanding into the payments and advertising markets. On the former, the company has already intermediated $38 million in GMV through a new payments experience that it began to roll out domestically in September. And on the latter, eBay now boasts over 160 million promoted listings from more than 400,000 sellers.
Finally, CEO Devin Wenig outlined plans to "target our marketing to focus more heavily on acquiring new buyers, while reducing our overall investment" -- moves that will temper revenue growth in the near term, but leave eBay well-positioned to boost margins as its payments and advertising initiatives gain steam.
Steve Symington has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Facebook. The Motley Fool has the following options: short November 2018 $155 calls on Facebook and long November 2018 $135 puts on Facebook. The Motley Fool recommends eBay. The Motley Fool has a disclosure policy.