The stock market had a big upward move on Wednesday, with investors eventually deciding that the Federal Reserve's stance on interest rates was consistent with what they wanted to see over the long run. Although there's still considerable uncertainty about what 2022 will bring in terms of macroeconomic improvement and the unstable geopolitical situation, market participants always like having at least an idea of where policymakers at the Fed are likely to take things. After big gains, Thursday morning's premarket activity brought some very modest pullbacks. As of 7:30 a.m. ET, futures on the Dow Jones Industrial Average (^DJI -0.49%) were down 54 points to 34,005. S&P 500 (^GSPC 0.09%) futures had fallen 8 points to 4,350, while Nasdaq Composite (^IXIC 0.65%) futures had given back 32 points to 13,921.
The size of the stock market pullback since November has been big enough that many stocks are still 20%, 30%, or even 50% below their best levels over the past year. However, a few companies have been able to buck the downtrend and pushed out to new all-time highs on Wednesday. Below, you'll learn more about what's sending these stocks higher and whether the uptrend could continue.
Image source: Getty Images.
Another milestone for Buffett
Berkshire Hathaway (BRK.A -0.97%) (BRK.B -0.95%) has been one of the biggest stock market success stories of all time, and even as a nonagenarian, CEO Warren Buffett remains at the top of his game. The original Class A shares closed above the $500,000 mark on Wednesday, celebrating another first as the conglomerate pushed to record levels.
The recent success of the stock stands in stark contrast to how most investors felt during the growth-heavy days of 2020 and 2021. Many pundits had suggested that Berkshire's best days were behind it, as cutting-edge tech stocks produced huge returns while the Buffett-led company straggled behind.
Investors who remembered the late 1990s and early 2000s, however, aren't surprised at how Berkshire's stock has behaved. Back then, critics said many of the same things about Berkshire, arguing that Buffett had lost his way and that tech stocks were the only way to make money in the market. In the ensuing tech bust from 2000 to 2002, many of those high-flying tech stocks never came back -- but Berkshire thrived and made up for a lot of lost ground in terms of relative performance.
Now, Berkshire remains positioned with a lot of diversification, including its core insurance operations and a hefty investment in the energy sector through wholly owned businesses and its growing stake in Occidental Petroleum, not to mention its massive holdings of Apple. Don't expect Berkshire to be a high-growth company, but its stock's performance speaks for itself.
Healthy times at AbbVie
Meanwhile, shares of AbbVie (ABBV -1.12%) also hit record levels on Wednesday. The pharmaceutical stock has attracted a lot of attention because of its business stability and its track record of dividend growth.
AbbVie has largely flown under the radar for many investors, in part because like many drugmakers, it faces the huge challenge of how to replace the revenue from blockbuster treatments that are destined to lose their patent protection. In AbbVie's case, that's Humira, which treats a variety of ailments from arthritis to ulcerative colitis and Crohn's disease. Humira generated more than a third of AbbVie's total revenue over the past 12 months, but it will lose exclusivity in the U.S. market next year.
Yet despite the threat from biosimilar rivals for Humira, AbbVie has developed new treatments that it hopes will be able to take the blockbuster drug's place in producing sales. In addition to already approved drugs, AbbVie also has a solid pipeline of candidate treatments in clinical trials.
Over the long haul, AbbVie has given shareholders a great combination of share-price gains and dividend income. With a current yield of nearly 4%, all-time highs for the stock are icing on the cake, and defensively minded investors are starting to see the value of the pharmaceutical company's business model as a way to reduce overall portfolio volatility.
