The stock market soared on Wednesday, celebrating election results that came in largely as investors had expected. With the Democrats taking over the U.S. House of Representatives but the Republicans retaining control of the Senate, market participants seem to believe that the status quo is likely to remain in place through 2020, and that helped send major benchmarks up roughly 2%. Some stocks did even better, and Twilio (TWLO 1.91%), Etsy (ETSY -0.84%), and Amazon.com (AMZN 1.74%) were among the best performers on the day. Here's why they did so well.
Twilio makes a connection
Shares of Twilio soared 35% after the cloud communications platform provider reported its third-quarter financial results. The company saw a 68% jump in revenue from the previous year's third quarter, and Twilio said it made a modest profit on an adjusted basis, reversing a year-earlier loss. The company not only boosted its customer counts but got existing clients to deepen their relationships with Twilio's platform, and co-founder and CEO Jeff Lawson pointed to new products to help clients take greater advantage of cloud computing to facilitate connections with their organizations and with their own customers. With plenty of potential uses, such as the key-replacing SmarterKey remote access system, Twilio has the capacity to drive technological advancement into the future.
Etsy ramps up before the holidays
Etsy stock climbed 24% in the wake of the company's release of third-quarter financials. Gross merchandise sales jumped 21% to $922.5 million, accelerating from its growth pace in previous quarters, and Etsy reported better conversion rates and stronger pricing power that in turn is driving greater investment in improving the shopping experience on the creative-goods marketplace. Revenue soared more than 40% from year-earlier levels, and even though higher spending on marketing sent profits lower, Etsy has put itself in great position to take advantage of the holiday season and more effectively challenge traditional retailers with its offerings.
Amazon bounces back
Finally, shares of Amazon.com picked up 7%. The e-commerce behemoth's share-price gains likely stemmed from general excitement among market participants about a more favorable environment for stocks than some had feared, and after declines that had lopped roughly 25% off the stock, Amazon shareholders were ready for a comeback. Today's news items included Amazon's launch of Alexa and music services in the Mexican market, as well as expansion of grocery pickup from its Whole Foods subsidiary and some favorable comments from stock analysts. With so much potential for growth, Amazon.com almost seemed briefly to become a value stock, and investors today took advantage.