What Happened?
A number of stocks jumped in the afternoon session after President Trump cooled fears of a transatlantic trade war by calling off scheduled tariffs on European allies.
The rally followed a productive meeting in Davos with NATO Secretary General Mark Rutte, where a "framework of a future deal" regarding Greenland and the Arctic region was established. By explicitly ruling out the use of military force and suspending the 10% tariffs previously set for February 1st, the administration provided the "sigh of relief" the market desperately needed after Tuesday's sharp sell-off. Technology and semiconductor leaders like Nvidia and AMD spearheaded the recovery as investors quickly pivoted back into growth stocks. The "Sell America" trade from the prior session reversed sharply, with the Nasdaq Composite jumping 1.5% and the S&P 500 erasing its 2026 losses. This rebound was further supported by a stabilization in the bond market; as tariff-related inflation fears subsided, the 10-year Treasury yield retreated from its recent highs, creating a more favorable backdrop for equity valuations across the board.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Professional Staffing & HR Solutions company Insperity (NYSE: NSP) jumped 5%. Is now the time to buy Insperity? Access our full analysis report here, it’s free.
- Hardware & Infrastructure company Pure Storage (NYSE: PSTG) jumped 3.8%. Is now the time to buy Pure Storage? Access our full analysis report here, it’s free.
- Electronic Components & Manufacturing company CTS (NYSE: CTS) jumped 4.1%. Is now the time to buy CTS? Access our full analysis report here, it’s free.
- Terrestrial Telecommunication Services company Lumen (NYSE: LUMN) jumped 4.2%. Is now the time to buy Lumen? Access our full analysis report here, it’s free.
- Electronic Components & Manufacturing company Plexus (NASDAQ: PLXS) jumped 3.3%. Is now the time to buy Plexus? Access our full analysis report here, it’s free.
Zooming In On Insperity (NSP)
Insperity’s shares are quite volatile and have had 15 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 6 months ago when the stock dropped 23.5% on the news that the company reported disappointing second-quarter financial results and issued a weak outlook for the rest of the year.
The human resources firm posted adjusted earnings of $0.26 per share, a figure that missed analyst estimates and represented a 70% plunge from the prior year. The company attributed the significant drop in profit to higher-than-expected benefits costs, specifically pointing to rising pharmacy expenses and an increased frequency of large insurance claims. This surge in costs also caused the company's gross profit to fall by 14% compared to the same quarter last year. To cap off the disappointing report, Insperity lowered its full-year earnings forecast, signaling to investors that these challenges were expected to persist.
Insperity is up 21.8% since the beginning of the year, but at $47.05 per share, it is still trading 50.1% below its 52-week high of $94.21 from March 2025. Investors who bought $1,000 worth of Insperity’s shares 5 years ago would now be looking at an investment worth $564.55.
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