US stocks rose on Thursday, and the Dow Jones Industrial Average was higher for the fifth day in a row as strong results from retailers boosted market sentiment.
“After spending a really challenging time with retailers last week, you’re starting to see some other signs that not everyone in retail is doing badly,” said Wayne Wicker, chief investment officer at MissionSquare Retirement. “It probably provides a little more confidence that the consumer is still relatively strong.”
Dow’s industrial indices rose 516.91 points, or 1.6 percent, to 32,637.19, up 11 percent from a record high in January. The S&P 500 rose 79.11 points, or 2%, to 4,057.84. The tech Nasdaq Composite rose 305.91 points, or 2.7 percent, to 11,740.65, aided by earnings from Apple, Microsoft, Amazon.com and Tesla.
Investors in stocks have endured a particularly volatile period recently. At the end of last week, the S&P 500 fell enough to close at least 20% below its peak in January. The benchmark then reversed to avoid closing the bear market.
Despite the rise in major indices this week, many investors expect markets to remain turbulent for some time.
“I think we’re still going through another instability,” said Leslie Thompson, chief investment officer at Spectrum Wealth Management.
Investors are considering how the Federal Reserve’s plans to tighten monetary policy could affect economic growth and financial market performance.
The minutes of the Fed meeting, released on Wednesday, show that politicians have agreed to raise interest rates by half a percent in June and July, according to previous communication. Major stock indexes closed higher after publication.
“To some extent, the markets have been reassured that the Fed will not tighten more aggressively than expected,” said Luke Philip, head of investment at SYZ Private Banking.
On Tuesday, traders worked on the New York Stock Exchange.
Photo: Justin Lane / Shutterstock
Money managers closely monitor new data as they assess the health of the economy. On Thursday, the second reading of the US gross domestic product for the first quarter was worse than the first with a contraction at an annual rate of 1.5%.
“Economic data is weaker than expected recently. We see this tightening in the economy. How serious the slowdown is, what the markets are thinking about now, “said Chanel Ramji, a multi-asset fund manager at Pictet Asset Management.
Initial unemployment claims fell last week and revolved near historic lows, suggesting a mixed economic picture.
Profit reports continued to stimulate stock movements. Analysts are examining the results for indications that inflation has begun to weigh on profits.
“We focus on profits and profitability. Many stable companies are reporting lower trends, “said Ramji. “Even the technology sector is not immune to margin pressures, especially from investment costs such as wages.
Shares of Williams-Sonoma jumped $ 15.02, or 13%, to $ 130 after the retailer reported gains that exceeded analysts’ expectations. Shares of Macy’s rose $ 3.71, or 19%, to $ 22.92 after the department store chain saw steady sales growth and raised its earnings guidelines.
Shares of Dollar Tree rose $ 29.21, or 22%, to $ 162.80, and shares of Dollar General rose $ 26.79, or nearly 14%, to $ 222.13 after discount retailers exceeded Wall Street’s earnings expectations. It was the best one-day gain in history for both stocks, according to Dow Jones Market Data.
Shares of Nvidia rose $ 8.76, or 5.2 percent, to $ 178.51 after the chipmaker posted record revenue, although its quarterly sales forecast was below Wall Street’s.
Shares of VMware added $ 3.82, or 3.2%, to $ 124.36 after Broadcom confirmed it would acquire the cloud computing company for $ 61 billion in cash and shares. Shares of Broadcom rose $ 19.03, or 3.6%, to $ 550.66.
In the bond market, the yield on the 10-year US government bond benchmark rose to 2.766%, from 2.746% on Wednesday. Yields rise as bond prices fall.
Brent, the global crude oil benchmark, added 3% to trading at $ 117.40 a barrel.
Abroad, the pan-continental Stoxx Europe 600 rose 0.8%. In Asia, key indicators were mixed. The Shanghai Composite Index added 0.5%, while Hang Seng in Hong Kong fell 0.3%. Japan’s Nikkei 225 also fell 0.3%.
South Korea’s central bank raised interest rates to 1.75% on Thursday and signaled it would tighten further policies to continue fighting high inflation.
Write to Karen Langley at karen.langley@wsj.com and Anna Hirtenstein at anna.hirtenstein@wsj.com
Copyright © 2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8
Add Comment