The major U.S. equity averages finished higher on Monday, with investors expressing optimism ahead of a coming flood of corporate earnings results. The Nasdaq led the advance, climbing by 2%.
Electric vehicle stocks benefited from the upswing. Tesla (TSLA) rallied ahead of an earnings report due out later this week. Meanwhile, Lucid (LCID) climbed on an upbeat analyst comment, with Rivian Automotive (RIVN), NIO Inc. (NIO) and XPeng (XPEV) all rising as well.
Among individual stocks, Wayfair (NYSE:W) represented another standout gainer, expanding its value by more than a quarter following an analyst upgrade. Elsewhere, Pliant Therapeutics (PLRX) jumped more than 30% following the release of clinical data.
On the other side of the spectrum, Catalyst Pharmaceuticals (CPRX) was among the most notable decliners on the session. Shares dropped almost 30% amid worries about generic competition.
Sector In Focus
Wall Street exhibited a risk-on sentiment during Monday's trading. This willingness to purchase more speculative investments gave a lift to EV stocks, which also received a boost from a positive analyst comment about Lucid (LCID).
Citi renewed coverage of LCID with a Buy rating, citing the firm's Q4 production update and steps it has taken on its balance sheet. "We continue to like the company’s technology and product positioning in the EV race," analyst Itay Michaeli stated.
Helped by the upbeat comment, LCID jumped almost 13% on the day. Meanwhile, industry bellwether Tesla (TSLA) participated in the sector as well, climbing nearly 8% ahead of an earnings report due out later this week.
Elsewhere in the group, Rivian Automotive (RIVN) climbed 12%, NIO Inc. (NIO) advanced 9% and XPeng (XPEV) rose more than 7%.
Standout Gainer
Wayfair (W) received a wave of buying interest after J.P. Morgan reversed its skepticism about the online retailer, making a bullish call based on its view that an earnings inflection could be on the way. Shares surged almost 27% during the session.
J.P. Morgan upgraded its rating on the stock by two notches, raising it to Overweight from Underweight. Analyst Christopher Horvers gave a positive assessment of the company's online assortment and supply chain, while noting that the market has taken a dim view of the stock since it hit post-pandemic highs in early 2021.
"Additionally, over the next 3-5 years, W should outgrow the category given the longer-term shift towards online retailing and its advantaged assortment/supply chain as the largest scaled online specialty player in the industry," Horvers stated.
Following the upgrade, W finished Monday at $59.33, an advance of $12.54 on the day. With the gains, the stock jumped to its highest close since last August.
Monday's rally added to a recent upswing for the stock, which has climbed 85% over the past month. Still, the one-time pandemic darling remains 61% lower for the past year. The stock had reached an all-time high of $369 in early 2021.
Standout Decliner
Worries about generic competition for its Firdapse drug sent Catalyst Pharmaceuticals (CPRX) sharply lower, with the stock plunging 29%.
The slide came as Teva Pharmaceutical (TEVA) submitted an application to the U.S. Food and Drug Administration for approval of a generic version of Firdapse. The product is used for the treatment of Lambert-Eaton myasthenic syndrome, a neuromuscular disorder.
While CPRX has patents for the drug, TEVA alleges that the patents are not valid, not enforceable, and/or will not be infringed. "Catalyst intends to vigorously enforce its intellectual property rights," the company said in a statement.
With the specter of generic competition, CPRX dropped $6.04 to close at $14.76.
Prior to the TEVA news, CPRX had been trending higher. The stock reached a 52-week high of $22.11 earlier this month. Even with Monday's drop, the stock has climbed 49% over the past six months and remains higher by over 160% on a 12-month basis.
Notable New High
The release of clinical data spurred a substantial rally of Pliant Therapeutics (PLRX), with the stock jumping 35%.
The company revealed interim data from a Phase 2a trial of its bexotegrast product. The drug is being tested as a treatment for a type of lung disease called idiopathic pulmonary fibrosis.
PLRX revealed that the highest dosage level of the drug met its main and secondary goals over a 12-week treatment period.
The data release pushed the stock to an intraday 52-week high of $36.50, representing a rally of more than 60% compared to the previous day's close. Shares moderated a bit from there but still eventually closed at $30.28, an advance of $7.77 on the day.
Overall, PLRX has climbed 63% over the past month. Shares have soared nearly 166% since the same period last year.
For more of the day's biggest winners and losers, head over to Seeking Alpha's On The Move section.