Latest News

Nasdaq rises about 2% as investors shake off weak Microsoft outlook, Fed hike fears

0

U.S. stocks were mostly higher Thursday as investors shook off weak guidance from technology bellwether Microsoft and worries about Federal Reserve rate hikes.

The Dow Jones Industrial Average was near flat. The S&P 500 gained 0.4%. The tech-heavy Nasdaq Composite ticked up 1.1%. The three indexes are coming off two consecutive down days.

Thursday saw another rocky session on Wall Street with the stock averages oscillating between gains and losses.

“The market is on pins and needles waiting to find out if inflation will come down and give us some respite from the Fed rate-hike regimen. That’s why we have this choppiness. It’s a period of great uncertainty,” Barry Bannister, Stifel chief equity strategist, said.

Fed Vice President Lael Brainard on Thursday said it is unlikely the central bank will take a break from its current rate-hiking cycle anytime soon.

“Right now, it’s very hard to see the cause for a pause,” Brainard told CNBC’s Sara Eisen during a “Squawk on the Street” interview. “We’ve still got a lot of work to do to get inflation down to our 2% target.”

Meanwhile, shares of Microsoft slid more than 1% as the company warned revenue and earnings this quarter would fall short of analysts’ estimates. The stock weighed on the Dow.

Other technology names rose and boosted the Nasdaq. Nvidia gained more than 5%, Zoom rose about 4% and Tesla added more than 4%.

Meta Platforms edged nearly 3% higher a day after Sheryl Sandberg announced she is stepping down from her role as chief operating officer.

Traders also parsed through corporate earnings results. Hewlett Packard Enterprise fell around 6% following slight misses on both earnings and revenue. Meanwhile, shares of pet retailer Chewy surged about 18% after the company reported strong quarterly results.

Job growth slows

Investors eyed employment data showing the slowest job creation pace of the pandemic-era recovery. Private sector employment rose by just 128,000 in May, ADP reported Thursday, falling well short of the 299,000 Dow Jones estimate. In another report Thursday, initial jobless claims last week fell and came in below expectations, according to the Labor Department.

The closely-watched jobs report for May is slated for release Friday morning. Economists expect 328,000 nonfarm jobs were added in the latest month, compared with 428,000 in April.

The three major stock averages are each down on the holiday-shortened week.

“Our view is cautious as we close out the second quarter,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management. “Global central bank uncertainty and the pace of tighter monetary policy, still-tight global energy … markets — which may lead to higher prices still — and headwinds for corporate earnings growth are risks for investors moving forward.”

Poland not at end of road on rule of law, says EU’s von der Leyen

Previous article

Harvey Weinstein’s sex crime convictions upheld by New York court

Next article

You may also like

Comments

Leave a reply

Your email address will not be published.

More in Latest News