U.S. stocks shrugged off early losses to traded mostly higher midday Thursday as investors dug through a heavy round of corporate earnings reports and parsed a better-than-expected report on weekly jobless benefit claims.

What are major indexes doing?
  • The Dow Jones Industrial Average
    DJIA,
    -0.14%

    fell 55 points, 0.2%, to trade near 34,082.

  • The S&P 500
    SPX,
    -0.02%

    bounced between fractional gains and losses at 4,174.

  • The Nasdaq Composite
    COMP,
    +0.23%

    gained 38 points, or 0.3%, to trade at about 13,988.

On Wednesday, stocks ended higher after back-to-back declines, with the Dow rising 316.01 points, or 0.9%. The S&P 500 gained 0.9%, while the tech-heavy Nasdaq Composite jumped 1.1%. The small-cap Russell 2000 index
RUT,
+1.00%

jumped 2.4%.

What’s driving the market?

Stocks turned modestly higher by midday Thursday, with quarterly corporate results largely beating Wall Street expectations this earnings season and weekly jobless benefits claims declining, after the good news lifted benchmark indexes to records last week.

So fart this quarter about 85% of S&P500 index companies have beaten earnings expectations, according to Refinitive. First quarter earnings per share growth is now estimated at 33.3%.

“It is only natural to expect markets to take a breather after posting a string of record highs earlier in the month. After all, technical indicators had been highlighting overbought conditions of late,” noted Han Tan, market analyst at FXTM.

But with the Cboe Volatility Index VIX, a measure of expected volatility for the S&P 500, trading below 20 and near its long-term average and 10-year Treasury yields BX:TMUBMUSD10Y steady after falling back from 14-month highs, the environment remains conducive for further stock market gains, Tan said.

In U.S. economic data, weekly jobless benefit claims fell by 39,000 to 547,000 in the week ended April 17, the lowest since before the pandemic struck. Continuing claims fell 34,000 to 3.67 million as of April 10.

“While surges in COVID variant infections remains a near-term risk, the outlook for US growth has been upgraded sharply. As more Americans get vaccinated and feel comfortable traveling, going to restaurants, sporting events and live entertainment, more and more people will be able to return to the workforce, if they choose to,” said Anu Gaggar, Senior Global Investment Analyst for Commonwealth Financial Network.

“Markets are not particularly enamored, however, as much of the good news has already been priced in. ”

U.S. existing-home sales slowed to a 6.01 million seasonally adjusted annual pace in March from 6.22 million in February as inventory remained tight, pushing prices higher. Separately, March leading economic indicators gained 1.3%.

Read: The ‘greening’ of the S&P 500: 7 charts for Earth Day

As expected, the European Central Bank left policy unchanged following its Governing Council meeting.

Which companies are in focus?
  • AT&T Inc.
    T,
    +4.42%

    shares rose 4.4% in early trade after reporting first-quarter results early Thursday.

  • Shares of Chipotle Mexican Grill Inc.
    CMG,
    -0.89%

    were down fractionally midmorning after the fast-casual restaurant chain late Wednesday blew past Wall Street expectations for its first quarter, saying new menu items, continued strength of online orders and a tailwind from stimulus checks pushed its sales more than 20% higher.

  • Qualtrics International Inc.
    XM,
    +24.18%

    shares jumped 20.2% after the maker of employee-engagement and survey software reported first-quarter results late Wednesday.

  • Shares of Lam Research Corp.
    LRCX,
    -3.35%
    ,
    which makes the instruments that foundries use to fabricate silicon wafers, slipped nearly 3% after reporting record quarterly results late Wednesday.

  • Whirlpool Corp.
    WHR,
    -0.76%

    shares dipped 0.7% after the appliances maker reported first-quarter earnings that were above Wall Street expectations and raised its guidance.

  • Sleep Number Corp.
    SNBR,
    -9.33%

    late Wednesday reported first-quarter earnings above Wall Street expectation and raised its guidance, but mentioned a supply snag that hit its sales in the quarter. Shares tumbled 9.7%.

  • SmartRent.com Inc., a provider of smart home operating systems, said it will go public via a merger with special purpose acquisition company (SPAC) Fifth Wall Acquisition Corp. I
    FWAA,
    +3.32%
    ,
     in a deal valued at $2.2 billion.

How are other assets performing?

Read next: Get ready for ‘reflation and reopening’ stock-market trade to kick into high gear, says JPMorgan’s top quant



Source link

×