The major Wall Street indexes rose on Thursday as investors evaluated the most recent economic data and kept an eye on an important inflation indicator as well as any indications of movement on a U.S. spending bill.
Megacap growth stocks including Tesla, Alphabet, Nvidia, and Meta Platforms changed their early course to gain between 1.6% and 2.6%, driving a rise of more than 1% on the tech-heavy Nasdaq.
At 12:12 p.m. ET, the Nasdaq Composite was up 142.30 points, or 1.09%, at 13,235.15, the S&P 500 was up 32.36 points, or 0.76%, and the Dow Jones Industrial Average was up 157.12 points, or 0.47%, at 33,707.39.
According to data, the American economy continued to develop at a respectable rate in the second quarter.
Initial claims for unemployment climbed marginally last week, indicating tight labour market conditions, and contracts to buy existing homes fell more than anticipated in August, according to separate assessments.
However, the prognosis for the remainder of 2023 is expected to be clouded by a potential U.S. government shutdown and an ongoing autoworker strike.
Investors anticipated the Democratic-controlled Senate’s procedural vote on a bipartisan short-term spending plan as there were only a few days left until a shutdown resolution.
A shutdown will impede GDP growth since federal spending makes up about 7% of the U.S. economy, according to Philip Marey, senior U.S. analyst at Rabobank.
While Chicago Fed President Austan Goolsbee underlined the likelihood of modifications to the central bank’s 2% inflation objective once the current bout of inflation is over, remarks by Federal Reserve Chair Jerome Powell at 4 p.m. ET will also be watched closely.
According to CME’s FedWatch tool, trader bets on the benchmark rate remaining steady in November and December were approximately 79% and 62%, respectively. A 25-basis-point rate drop is currently priced in beginning in March and increasing to over 31% in June and July.
U.S. oil futures surged to a more than one-year high early on Thursday, heightening concerns about inflation.
As a result of the uncertainty surrounding interest rates, Treasury yields have reached multi-year highs, and the S&P 500 and Nasdaq are on track to post their worst monthly results of the year.
In 2023, all three indices are expected to see their first quarterly fall.
The main topic is rates. Although monetary policy will continue to be restrictive, Dennis Dick, a market structure expert at Triple D Trading, predicted that the rate hikes will eventually stop.
The leading index gainers for the day were materials and communication services, with utilities continuing to be the primary laggard.
Micron Technology was one of the biggest movers, falling 2.8% after predicting a larger first-quarter loss.
CarMax dropped 10.0% after reporting a lower-than-anticipated quarterly profit.
After the IT services company predicted full-year earnings and first-quarter revenue below Wall Street targets, the stock fell 5.3%.
Following the closing bell, Nike gained 0.1% ahead of its quarterly results for the sportswear manufacturer.
On the NYSE and the Nasdaq, advancing issues outpaced declining ones by a ratio of 2.49 to 1 and 1.83 to 1, respectively.
The Nasdaq achieved 22 new highs and 219 new lows, compared to the S&P index’s three new 52-week highs and 32 new lows.