Wall Street Today: S&P 500, Nasdaq Composite and DJIA Set Record Closes on Rate-Cut-Friendly Inflation and Jobs Data
The Dow Jones Industrial Average, S&P 500 and Nasdaq Composite all closed at record highs Thursday as an in-line U.S. inflation report and higher-than-expected jobless claims seemed to all but assure the Fed will cut interest rates next week.
The $Dow Jones Industrial Average (.DJI.US)$ rose 617.08 points (1.4%) to a 46,108 record finish, surpassing a previous all-time-best ending set on Tuesday.
The $S&P 500 Index (.SPX.US)$ likewise gained 55.43 ticks (0.9%) to a 6,587.47 all-time-high close, while the $Nasdaq Composite Index (.IXIC.US)$ added 157.01 points (0.7%) to a 22,043.07 best-ever ending.
The SPX and IXIC had set their previous closing records just one day earlier. All three indexes also scored new intraday record highs earlier during Thursday's session.
Macro News
The three indexes rose in part as fresh U.S. inflation and jobs data showed relatively stable price gains and a weakening employment situation, apparently clearing the way for the Federal Reserve to cut rates at next Wednesday's policy meeting.
The Labor Department reported before the bell that a seasonally adjusted 263,000 Americans filed for unemployment compensation in the week ended Sept. 6 – the highest level since October 2021 and worse than the 235,000 that economists had expected.
Separately, the Bureau of Labor Statistics said the Consumer Price Index, which measures retail inflation, rose at a 2.9% rate in August, in line with economists' forecasts.
Following the reports, the CME FedWatch tool put the odds of a rate easing at 100% as of 4 p.m. ET Thursday.
The tool, which creates odds by analyzing Fed Funds futures trading, calculated a 94.8% chance of a 0.25% cut to the Federal Funds rate and a 5.2% probability of a 0.5% reduction.
That's up from the 85.9% chance of a 0.25% cut and 0% odds of a 0.5% reduction that the CME had projected a month ago.
Wall Street typically likes Fed rate reductions because those usually lead to lower bond and money-market yields, making stocks look more attractive to investors and often bringing fresh money into equities.
Moo-vers
Thursday's record-setting run extended only partly to the "Magnificent Seven" stocks, which ended mixed.
Four Mag-7 names rose, led by $Tesla (TSLA.US)$. The electric-vehicle giant added 6% on reports of strong sales for its six-seater Model Y L for the Chinese market.
Tesla pushed out deliveries for new Y L orders out to November, indicating that it's completely sold out of inventory for September and October deliveries.
Other Mag-7 stocks to end Thursday higher included $Apple (AAPL.US)$ (up 1.4%), $Alphabet-A (GOOGL.US)$ (0.5% better) and $Microsoft (MSFT.US)$ (which added 0.1%).
Conversely, $Amazon (AMZN.US)$ eased 0.16% among Mag-7 decliners, while $Meta Platforms (META.US)$ shed 0.14% and $NVIDIA (NVDA.US)$ gave back 0.08%.
Elsewhere in the market, Thursday's major percentage decliners included:
-- $Klarna Group (KLAR.US)$, off 6.7%. The buy-now/pay-later firm consolidated after rising 14.6% Wednesday in its first trading session after going public at a stronger-than-expected $40 a share. KLAR closed Thursday at $42.74 -- still up 6.9% from its IPO price.
-- $Oracle (ORCL.US)$, down 6.2%. The tech giant gave back part of the 36% rally it enjoyed Wednesday after reporting a 1,529% gain in multi-cloud database revenue from Amazon, Alphabet and Microsoft. Oracle also forecast 13x growth in cloud-infrastructure revenue over the next five years.
-- $NEBIUS (NBIS.US)$, 4.5% weaker. The tech-infrastructure company continued to give back part of a 49.4% gain that it saw Tuesday on news of a five-year contract with MSFT that could be worth as much as $36.8 billion.
Meanwhile, Thursday's noteworthy percentage gainers included:
-- $Opendoor Technologies (OPEN.US)$, up 78.8% to a $10.475 close. The home-buying platform and meme stock rallied after naming Kaz Nejatian, COO of $Shopify (SHOP.US)$, as its new CEO. OPEN also named co-founders Keith Rabois and Eric Wu to its board, with Rabois serving as chairman. Shares rose to as high as $10.70 during the session – their best level since February 2022 and up nearly 2,000% since OPEN hit a $0.51 all-time intraday low less than three months ago.
-- $Red Cat Holdings (RCAT.US)$, better by 29.1%. The defense contractor rose on word that the North Atlantic Treaty Organization has approved its Black Widow drone system for procurement. That clears the way for the militaries of the United States and NATO's 31 other members to buy the system.
-- $Warner Bros Discovery (WBD.US)$, 28.8% stronger. The media-and-entertainment giant rose on media reports that rival $Paramount Skydance (PSKY.US)$ plans to make a takeover bid for Warner Brother Discovery as soon as next week. PSKY rose 15.6% on the news, and also touched a more than two-year intraday high (including pricing for its predecessor company Paramount Global). Similarly, WBD hit its highest intraday level since June 2022.
-- $Figure Technology Solutions (FIGR.US)$, up 24.4%. The fintech soared to a $31.11 close on its first trading day following an initial public offering that priced at $25 a share – well above its expected range. FIGR even briefly hit $38.05, up 52.2% from its IPO price.
Disclaimer: This presentation is for informational and educational use only and is not a recommendation or endorsement of any particular investment or investment strategy. Indexes are unmanaged and cannot be directly invested in. Past performance is no indication of future results. Investing involves risk and the potential to lose principal. Investment information provided in this content is general in nature, strictly for illustrative purposes, and may not be appropriate for all investors. It is provided without respect to individual investors' financial sophistication, financial situation, investment objectives, investing time horizon, or risk tolerance. You should consider the appropriateness of this information regarding your relevant personal circumstances before making any investment decisions. Past investment performance does not indicate or guarantee future success. Returns will vary, and all investments carry risks, including loss of principal.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Jerry Kronenberg
Director of Financial Content
Former top editor at Seeking Alpha, Fidelity.com, TheStreet.com and UPI.
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壮士出川 : According to this statement, this stock can be monitored for another two weeks.
MyRoseOfSharon : Great day to be $Opendoor Technologies (OPEN.US)$
74463531 : c
affable Blobfish_403 : The U.S. economy is experiencing a 'moderate' recession, and inflation is 'moderately' rising; this is a stagflation, isn't it!
ah-kbb affable Blobfish_403 : However, no one seems to care as the stock market continues its relentless upward trend.