The stock market has eased off on the throttle after a wild start to November, and the calm period continued on Thursday morning. Enthusiasm about the holiday season was tempered by nervousness over coronavirus-inspired restrictions, and market participants gravitated toward the stocks they were most comfortable with in uncertain times. As of 11:30 a.m. EST today, the Dow Jones Industrial Average (^DJI 2.12%) was down 86 points to 29,352, and the S&P 500 (^GSPC 1.45%) had fallen 2 points to 3,565. But the Nasdaq Composite (^IXIC 1.07%) climbed 67 points to 11,869.
Within the market, the electric vehicle (EV) industry has gotten a huge amount of attention. That continued today as momentum built over another special purpose acquisition company (SPAC) that is targeting a privately held player in the EV niche. Meanwhile, intimate apparel and personal-care products giant L Brands (BBWI 4.32%) got a nice lift after reporting its latest financial results.
An EV target over the pond
The latest news in electric vehicles came from a SPAC called CIIC Merger (CIIC). The share price was up another 29% Thursday morning, adding to its 24% rise Wednesday.
The entity just came public in February, but it announced its intended target early Wednesday. The company's name is Arrival, and the U.K.-based designer and assembler of EVs is looking to reinvent the auto industry.
Specifically, Arrival's approach is to use micro-factories rather than massive production facilities. By doing so, Arrival is trying to make production less capital-intensive, which in turn should reduce costs for consumers and make it easier for the industry to make the transition away from fossil-fuel vehicles.
Under the terms of the deal, CIIC will provide $660 million in capital to help Arrival's expansion plans. That values the company at roughly $5.4 billion.
The news helped push shares of other EV players higher, including a 4% gain for Nikola (NKLA 1.97%) and a 3% rise in shares of Lordstown Motors (RIDE -0.92%). With contracts worth $1.2 billion and production scheduled for the last quarter of 2021, Arrival could be an interesting play on EVs.
L Brands gets a W
Elsewhere, L Brands shares climbed 15%. The company had extremely strong results in its third quarter, pointing the way toward a nice recovery for the lingerie and personal-care products retailer.
L Brands saw revenue rise 14% from year-ago levels, spurred by a massive 28% rise in comparable-store sales for the period. The company posted earnings that were better than expected, reversing a year-earlier loss and rebounding nicely from tough conditions earlier this year.
CEO Andrew Meslow attributed the gains to a couple of factors. Continued strength in results from the Bath & Body Works segment kept carrying much of the load for L Brands. In addition, the company saw a significant improvement in performance from the Victoria's Secret store chain. Despite a cautious approach given the pandemic, L Brands is positioning itself for a successful holiday season.
The move pushed L Brands' stock price to its best level since early 2018. A turnaround for the company has been a long time coming, but shareholders are finally getting rewarded for their patience. Under conditions that have been trying for many retailers, L Brands is executing well on its recovery strategy, and it's generating optimism among investors for the first time in a long time.