News

Market Snapshot: Dow rises over 300 points after upbeat earnings from big banks, economic data

U.S. stocks rose Thursday, as a parade of big banks released upbeat earnings and data showed a drop in first-time jobless claims to the lowest since the pandemic began and a smaller-than-expected rise in producer prices.

A continued fall in Treasury yields, meanwhile, offered support for interest rate sensitive technology stocks.

What’s happening
  • The Dow Jones Industrial Average
    DJIA,
    +1.21%

    rose 339.91 points, or 1%, to 34,717.72.
  • The S&P 500
    SPX,
    +1.34%

    advanced 44.33 points, or 1%, to 4,408.13.
  • The Nasdaq Composite
    COMP,
    +1.47%

    was up 169.69 points, or 1.2%, at 14,741.32.

On Wednesday, the Dow Jones Industrial Average fell less than a point to extend a losing streak to four sessions, while the S&P 500 rose 0.3% and the Nasdaq Composite advanced 0.7%.

What’s driving markets

Corporate earnings reporting season is picking up steam, with results from a handful of major banks topping expectations. Investors also cheered economic data, including a drop in first-time claims for unemployment benefits last week to 293,000 — the first sub-300,000 reading since before the pandemic took hold in early 2020.

“While the September jobs report revealed a slower pace of job creation, the labor market recovery continues to move forward and the claims data are consistent with an improving employment situation,” said Nancy Vanden Houten, lead economist at Oxford Economics, in a note. “We expect further progress in the months ahead as the health situation is improving following the surge in cases over the summer from the delta variant.”

In other U.S. data, producer prices rose 0.5% in September compared with 0.7% in August but were up 8.6% for the September year compared with 8.3% for the year to August.

Investors have also focused on the more benign elements of Wednesday’s consumer-price index report, which showed the core measure that excludes food and energy prices rising 0.2% in September, keeping the year-over-year growth rate at 4%.

Prices of airfares, hotels and used cars were among the costs that declined. “While that result owed to some weakness in prices sensitive to the virus — such as airfares, hotel charges, car rental fees and apparel — the yield on the 10-year U.S. Treasury
TMUBMUSD10Y,
1.531%

continued to descend from last week’s highs,” said Emily Nicol, economist at Daiwa Capital Markets Europe.

In the markets, the drop in longer-dated yields overshadowed everything else, breathing life back into equities and gold prices,” said Marios Hadjikyriacos, senior investment analyst at XM, in a note.

“Yield-sensitive tech and growth stocks benefited the most as traders grew more confident that the Fed won’t risk a repeat of the late-2018 market crash, which was triggered by rates rising too far…That said, the technical structure still argues for caution as the S&P 500 and the Nasdaq have been unable to record a higher high yet, even if ‘stagflation’ worries have taken a back seat,” the analyst said.

Read: Stronger-than-expected U.S. inflation data has bond traders weighing the risk of a Fed policy error

Which companies are in focus?
What are other markets doing?
  • The 10-year Treasury yield fell 1.5 basis points to 1.534%. Yields and debt prices move in opposite directions.
  • The ICE U.S. Dollar Index
    DXY,
    -0.16%
    ,
    a measure of the currency against a basket of six major rivals, fell 0.2%.
  • The Stoxx Europe 600
    SXXP,
    +1.24%

    rose 1.1%, while London’s FTSE 100
    UKX,
    +0.95%

    raised 0.8%.
  • The Shanghai Composite
    SHCOMP,
    -0.10%

    fell 0.1%, while Japan’s Nikkei 225
    NIK,
    +1.46%

    advanced 1.5%.
  • Oil futures rose, with the U.S. benchmark
    CL00,
    +0.61%

    up 0.5% at $80.84 a barrel. Gold futures
    GC00,
    +0.32%

    edged up 0.2% to $1,797.50 an ounce.

Sign up for a brand new MarketWatch newsletter on crypto launching next month. Use this link to subscribe to “Distributed Ledger,” where every week we highlight the most timely news in the crypto and blockchain industry, from developments in digital-asset companies, exchanges, funds and ventures, as well as important sector research and data. And of course, we’ll keep you up to speed on price performance in all the major crypto.
MarketWatch and Barron’s also is gathering the most influential figures in crypto to help identify the opportunities and risks that lie ahead in digital assets on Oct. 27 and Nov. 3. Sign up now!

What's your reaction?

Excited
0
Happy
0
In Love
0
Not Sure
0
Silly
0

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *

More in:News