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Stock Markets Fall, but These 4 Winners Keep on Winning

Friday was an ugly day for the stock market. The Nasdaq Composite (NASDAQINDEX: ^IXIC) dove during the middle of the trading day, and it took a sizable rebound for it to finish the day down just 1%. Similar-sized declines ruled the day for the Dow Jones Industrial Average (DJINDICES: ^DJI) and S&P 500 (SNPINDEX: ^GSPC).

Index

Percentage Change

Point Change

Dow Jones Industrials

(0.88%)

(245)

S&P 500

(1.12%)

(38)

Nasdaq Composite

(1.07%)

(117)

Data source: Yahoo! Finance.

But there were still some winning stocks, even though the market was down. In fact, the stocks that were higher were familiar names that have done well consistently throughout 2020. It's evident that investors want to stick with winners, and the same themes are showing up day after day, regardless of what the broader market does.

Image source: Getty Images.

Four winning themes

Most of the big-name stocks that have led the way forward for the stock market over the past several years were among today's losers. The FAANG stocks were all down, with Apple (NASDAQ: AAPL) in particular giving up another 3%. That brought the iPhone maker's losses since its highs earlier this month to 22%.

Instead, the companies with the largest market caps showing 5% gains today were in four key categories. They include:

1. Teleconferencing

Zoom Video Communications (NASDAQ: ZM) added to its impressive gains this year, climbing another 6%. With signs that the coronavirus pandemic is likely to persist for quite a while, the arguments about Zoom being a passing fad are carrying less weight as the business grows. Zoom has momentum not just in its stock price but in its business, and as long as that matches up well, the stock could continue to move higher.

2. Cloud computing

Recent IPO Snowflake (NYSE: SNOW) recovered some of Thursday's decline on Friday, rising more than 5%. The stock closed at exactly double its $120 offering price. The jury's still out on whether Snowflake is painfully overpriced or simply ahead of the curve in terms of investor appreciation. Few argue, though, that Snowflake's technology doesn't have value. As more companies move to the cloud, companies like Snowflake will remain in high demand.

3. E-commerce

Wayfair (NYSE: W) climbed almost 8% Friday, once again proving that Amazon.com isn't the only company that can play in online retail. The internet furniture specialist has done well during the pandemic, meeting demand and finding ways to surmount the challenges inherent in shipping large items effectively. Investors like what they've seen, and Wayfair is optimistic about its ability to keep winning.

4. Connected fitness

Finally, Peloton Interactive (NASDAQ: PTON) picked up 5%. Some have recently feared that Apple might make a foray into the connected fitness space, using the power of its Apple Watch and its ecosystem to put together a credible challenge to Peloton's network of online fitness resources. However, even Apple wouldn't be able to close the gap overnight. Moreover, Peloton's new suite of products with lower prices and more attractive features could entice those who've been on the fence to finally go ahead and buy.

Winning stocks tend to keep winning because their businesses keep performing well. As long as that remains the case, all four of these trends could gain ground even if the stock market keeps stumbling.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Dan Caplinger owns shares of Apple. The Motley Fool owns shares of and recommends Amazon, Apple, Peloton Interactive, Wayfair, and Zoom Video Communications. The Motley Fool recommends Snowflake Inc and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool has a disclosure policy.


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