The Nasdaq Composite (^IXIC 2.02%) has been the leader in 2020, easily leaving the Dow Jones Industrials in the dust. Even though the Dow grabbed headlines Tuesday with some big changes to its 30 constituent stocks, it once again dramatically underperformed both the Composite and the Nasdaq 100 Index. Today's gains were enough to send the Composite to its fourth record high in a row.
After finding out about the switches within the Dow, many investors believe that Facebook (META 0.43%) got unfairly left out. That might be true, but it didn't stop shareholders from bidding up the stock price anyway. Meanwhile, Starbucks (SBUX 0.47%) also got a vote of confidence that helped its stock break out of a long rut and move higher.
Facebook fights back on e-commerce
Shares of Facebook were higher by 4% on Tuesday. The social media giant took a big step forward in seeking to take advantage of growing demand for e-commerce by releasing new tools that could help promote more shopping activity in its ecosystem.
Facebook's new features span multiple platforms. For its namesake service, Facebook Shop will now get its own special section in the Facebook app. That will give users direct access to interesting shopping items, rather than counting on them finding out about offerings on their feeds or having them proactively go to a specific store's Facebook page.
Meanwhile, both Facebook and Instagram will make it easier for merchants to interact with customers. With new ways to present products and a greater ability to analyze performance data, merchant users will be better able to tell how well their businesses are doing and how they can make improvements. By allowing customers to use messaging functions to talk to merchants, Facebook will promote greater cross-usage of its services.
Facebook also got a boost as e-commerce platform provider BigCommerce Holdings (BIGC 3.33%) announced a checkout service tool for Instagram users. To the extent that Facebook can pit e-commerce companies like BigCommerce and Shopify against each other, it will establish the desirability of the social media company's ecosystem and the billions of users who count on it.
Image source: Getty Images.
Raise a cup
Elsewhere, Starbucks shares climbed 5%. The coffeehouse giant got a vote of confidence from Wall Street analysts, taking the share price to its highest level since June.
The favorable comments came from analysts at Stifel, who upgraded Starbucks from hold to buy. They also raised their price target on Starbucks by $12 to $90 per share.
Stifel admits that Starbucks has had a tough time during the COVID-19 pandemic. Traffic levels have fallen, especially as people travel less frequently. However, the analysts believe that slumping same-store sales trends are reversing course and starting to bounce back. Moreover, with a new emphasis on features like curbside pickup and different store formats, Starbucks is open to dramatic change in order to survive and thrive.
Even if you don't like pumpkin spice latte -- which Starbucks released earlier than ever this year -- Starbucks is still doing everything it can to entice you back. Shareholders seem optimistic that after a long wait, Starbucks stock might finally be ready to perk higher.
