2020 was a great year for the Nasdaq Composite (NASDAQINDEX:^IXIC). But at least based on the first trading day of the year, 2021 might not be as friendly to investors who bet big on a bull market rebound from the coronavirus bear market in March. The Nasdaq pulled back from record highs, falling 2.5% as of 12:30 p.m. EST.
Most of the Nasdaq's biggest names fell dramatically as well. Yet amid the carnage, two stocks rose to the top -- just as they did in 2020. Zoom Video Communications (NASDAQ:ZM) and Tesla (NASDAQ:TSLA) defied the negative news for the new year and pushed higher, and many think the two companies might well have a lot more upside in the months and years to come.
Zoom zips higher
Shares of Zoom Video Communications were up more than 4% on Monday afternoon. The video conferencing specialist became an essential service in 2020, and signs suggest that might not change anytime soon.
Zoom had already gone through a significant sell-off during the last couple of months of 2020. Despite posting incredibly strong growth numbers, the stock fell more than 40% from its mid-October highs by the end of the year. The move lower reflected anticipation that a coronavirus vaccine would allow people to return to in-person contact, reducing the need for Zoom's services over the long run.
However, things on the COVID-19 front haven't gone as well as expected recently. A new strain of the coronavirus has forced many countries around the world back into lockdown mode, and case counts in the U.S. and elsewhere remain stubbornly high. Moreover, vaccine distribution in the U.S. and elsewhere hasn't gone smoothly, with much lower adoption than previously anticipated.
Today's drop for the broader stock market reflects some cracks in the armor of bullish investors who'd counted on a quick recovery from the pandemic in 2021. The longer the disease remains unchecked, the longer people will rely on Zoom for communication.
Tesla finishes oh so close
Meanwhile, shares of Tesla were on the rise, climbing 3%. The typical year-end delivery rush didn't quite work out exactly how CEO Elon Musk had scripted it, but investors were still pretty happy with the outcome.
Tesla delivered 180,570 vehicles during the fourth quarter of 2020, according to figures released on Saturday. Nearly 90% of those cars were Model 3 and Model Y vehicles, with the high-end Model S and X representing the other 10%. The figures represented new quarterly records for Tesla.
For the full year, deliveries came in at 499,500. That was just shy of the 500,000 target that Musk had set for Tesla, but the company left open the idea that a recount could push it higher by noting that final numbers could vary by up to half a percent.
Growth of more than 60% from the fourth quarter of 2019 and year-over-year gains of 36% from 2019's total of roughly 368,000 vehicle deliveries were quite impressive, and they point to a healthy future trajectory for the automaker going forward. What's left to see is whether that will translate into another stupendous year for the stock, but today's rise is an encouraging sign.