Green Wave Boosts Stocks, Bonds As Traders Embrace Fed's Stance, Await Apple Earnings: What's Driving Markets Thursday?

Risk appetite is surging again Thursday on Wall Street, with investors welcoming the Federal Reserve’s decision to keep rates unchanged and Fed Chair Jerome Powell‘s cautious remarks.

Traders flocked to rate-sensitive tech stocks and bonds as expectations grew that the Federal Reserve might consider lowering interest rates as early as June 2024. Treasury yields declined by 10 basis points for 30-year maturities and 6 basis points for 10-year maturities. The market rally was widespread, with all S&P 500 sectors posting gains.

Investors now turn their focus on the U.S. largest company by market capitalization, Apple, Inc. AAPL, which is set to release its fourth-quarter earnings report at the end of the trading day.

Cues From Thursday’s Trading:

The S&P 500 rallied 1.6%, on track for its sharpest one-day increase since early May. The tech-heavy Nasdaq 100 surged 1.5%, on course for its fifth straight session of gains.

The Dow Jones Industrial Average rose 1.3%, while small caps in the Russell 2000 rallied 1.7%.

US Index Performance On Thursday

Thursday Trading In Major US Equity ETFs

• The SPDR S&P 500 ETF Trust SPY was 1.6% higher to $429.47.
• The SPDR Dow Jones Industrial Average ETF DIA rose 1.3% to $336.96.
• The Invesco QQQ Trust QQQ rallied 1.6% to $362, according to Benzinga Pro data.

Looking at S&P 500 sector ETFs:

• The Real Estate Select Sector SPDR Fund XLRE was the largest gainer, up 3.5%, followed by discretionary (up 2.4%) and energy (up 2.3%).
• The Communication Services Select Sector SPDR Fund XLC was the underperformer, but still showing a robust 1% surge.

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Stocks In Focus

• Roku, Inc. ROKU rallied 30% following the release of its quarterly results.
• Among the other stocks moving on earnings are Fastly, Inc. FSLY (up about 16%), Etsy, Inc. ETSY (up 2.3%), The Clorox Company CLX (up nearly 8%), Lemonade, Inc. LMND (up about 37%), PayPal Holdings, Inc. PYPL (up about 6%), Qualcomm, Inc. QCOM (up about 6%), Starbucks Corporation SBUX (up over 10%) and Tandem Diabetes Care, Inc. TNDM (down 23%).
• Bausch Health Companies Inc. BHC (up 3%), ConocoPhillips COP (up over 5%) Crocs, Inc. CROX (down over 6%), Eli Lilly and Company LLY (up over 4%) Ferrari N.V. RACE (up over 5%), Fox Corporation FOXA (up over 2%), Hyatt Hotels Corporation H (down over 2%), Marriott International, Inc. MAR (down over 2%), Moderna, Inc. MRNA (down over 7%), The Wendy’s Company WEN (down nearly 2%), Paramount Global PARA (up over 8%), Regeneron Pharmaceuticals, Inc. REGN, (up over 4%) The Cigna Group CI (down over 1%) and Peloton Interactive, Inc. PTON (up over 16%).
• Those reporting after the close include Apple, Block, Inc. SQ, DraftKings Inc. DKNG, Dropbox, Inc. DBX, Expedia Group, Inc. EXPE, Fortinet, Inc. FTNT, Live Nation Entertainment, Inc. LYV, Palantir Technologies Inc. PLTR and Skyworks Solutions, Inc. SWKS.

Commodities, Bonds, Other Global Equity Markets

Crude oil rose 1.5%, with a barrel of WTI-grade crude trading at $82. The United States Oil Fund ETF USO was 1.6% higher to $75. 

Treasury yields were lower, with the 10-year yield up by 5 basis points to 4.69% and the 30-year yield down by 8 basis points to 4.85%. The iShares 20+ Year Treasury Bond ETF TLT was 1.5% higher for the day. 

The dollar fell, with the U.S. dollar index, which is tracked by the Invesco DB USD Index Bullish Fund ETF UUP down 0.4%. The EUR/USD pair, which is tracked by the Invesco CurrecyShares Euro Currency Trust FXE, rose 0.5% to 1.0617.

European equity indices had a strong positive session. The SPDR DJ Euro STOXX 50 ETF  FEZ rose 2.1%. 

Gold was flat at $1,982/oz, while silver fell 0.8% to $22.75. Bitcoin BTC/USD was 2.3% lower to $34,636.

Staff writer Piero Cingari updated this report midday Thursday. 

Photo via Shutterstock.