U.S. stocks had a mixed session as of midday Thursday, with technology stocks outperforming and the Nasdaq 100 index reaching 13-month highs. Fed speakers delivered further hawkish statements and investors reassessed the outlook for monetary policy, revising upward expectations for a June rate rise. Treasury yields rose across all maturities.
Weekly jobless claims declined, beating expectations to the downside and indicating that labor market conditions remains healthy.
Netflix Inc. NFLX was among the top movers for the day, with shares rising nearly 10%, on track for the best trading day in 2023, as investors welcomed a new advertising plan.
Cues From Thursday's Trading:
The S&P 500 rose 0.2%, while blue-chip stocks in the Dow Jones Industrial Average fell 0.2%.
The tech-heavy Nasdaq 100 gained 1.1%, aided by solid gains in tech giants.
Small caps in the Russell 2000 index fell 0.2%.
U.S. Indices’ Performance Monday
| Index | Performance (+/-) | Value |
| Nasdaq Composite Index | +1.11% | 13,741.76 |
| S&P 500 Index | +0.25% | 4,169.53 |
| Dow Industrials | -0.21% | 33,290.18 |
Analyst Color:
A Morgan Stanley analyst called for extended volatility in the market. Morgan Stanley's Lisa Shalett said this week that the market historically continues to fall after the first rate cut, extending the bear market and hitting a new low. The average decline has been 23% after the final rate hike in a monetary policy cycle, she added.
"Investors should take caution and consider portfolio rebalancing and dollar-cost-averaging," Shalett said. She suggests looking for income opportunities in both stocks and bonds. Portfolio diversification across asset classes and regions remains key, she added.
Thursday's Trading In Major US Equity ETFs: In midday trading on Thursday, the SPDR S&P 500 ETF Trust SPY was 0.2% higher to $416.22, the SPDR Dow Jones Industrial Average ETF DIA fell 0.33% to $333.06 and the Invesco QQQ Trust QQQ rose 1.1% to $334.80, according to Benzinga Pro data.
Growth-related sectors were the outperformers, with the Technology Select Sector SPDR Fund XLK, the Communication Services Select Sector SPDR Fund XLC and the Consumer Discretionary Select Sector SPDR Fund XLY were up 1.4%, 1% and 0.6%, respectively.
The undeperformers was the Real Estate Select Sector SPDR Fund XLRE, down 1.1%, followed by the Consumer Staples Select Sector SPDR Fund XLP.
Latest Economic Data:
The Labor Department reported a decline in weekly jobless claims by 22,000 to 242,000, below than the 254,000 expected by economists.
The Philadelphia Federal Reserve rose to a negative 10.4 in May 2023, up from a negative 31.3 in April, a nearly three-year low, and better than market expectations of negative 19.8.
Fed speakers delivered hawkish remarks on Thursday, with the Fed's Lorie Logan stating that she is not yet ready to pause.
The Conference Board's leading indicator for April slowed at a pace of 0.6% month-over-month after a 1.2% drop in March, matching analyst expectations.
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Stocks In Focus:
Walmart Inc. WMT slightly rose 0.5% after reporting better-than-expected results last quarter.
Alibaba Group Holdings Ltd. BABA fell 4% after largely missing both earnings and revenues expectations last quarter.
NVIDIA Corp. NVDA rose 4%, on track for a four-day winning streak, hitting December 2021 highs.
Newmont Corp. NEM dropped nearly 4%, after gold prices dropped.
- Take-Two Interactive, Inc. TTWO rose over 10% after the video game software company reported its fiscal year fourth-quarter results.
- Bath & Body Works, Inc. BBWI also increased nearly 10% after reporting better-than-expected results in Q1.
- Pacwest Bancorp PACW rose 11%, after rising 22% Wednesday on increasing investor optimism around regional bank stocks.
- Target Corporation TGT dropped 4%, despite releasing better-than-expected results in Q1.
- Palantir Technologies, Inc. PLTR rose over 10% after Cathie Wood's Ark Invest picked up a chunk of shares in the data intelligence software company.
- Notable companies reporting after the close include Applied Materials, Inc. AMAT, Ross Stores, Inc. ROST, Farfetch Limited FTCH and Nutanix, Inc. NTNX.
Commodities, Bonds, Other Global Equity Markets:
Crude oil fell 1.5%, with a barrel of WTI-grade crude falling to $71.7. The United States Oil Fund ETF USO was 1.4% lower to $63.73 per share.
Treasury yields rose, with the 10-year yield up by 7 basis points to 3.64% and the two-year yield up 8 basis points to 4.24%. The iShares 20+ Year Treasury Bond ETF TLT was 0.4% lower for the day.
The dollar strengthened, with the U.S. dollar index, which is tracked by the Invesco DB USD Index Bullish Fund ETF UUP, up 0.6%. The EUR/USD pair, which is tracked by the Invesco CurrecyShares Euro Currency Trust FXE, was 0.7% lower to 1.0763.
European equity indices were mixed. The iShares MSCI Eurozone ETF EZU fell 0.4%.
Gold fell 1.4% to $1,955/oz. The SPDR Gold Trust GLD was 1.4% lower to $181. Silver also fell 1.3% to $23.45, with the iShares Silver Trust SLV down 1.2% to $21.55 per share. Bitcoin BTC/USD fell 1.2% to $27,085.
Staff writer Piero Cingari updated this report midday Thursday.
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