US close: Tech stocks lead the surge

(Sharecast News) - US stocks rose strongly on Thursday with tech names leading the surge as investors continued to absorb comments from the Federal Reserve the previous session, who reassured that interest rates are unlikely to rise despite stickier-than-expected inflation.

The Dow and S&P 500 both finished 0.9% higher while the tech-heavy Nasdaq jumped 1.5%, as markets started to turn their attention to Friday's non-farm payrolls report.

US job creation for April is pencilled in at 243,000, according to consensus estimates, down from 303,000 in March, while investors will keep a close eye on the hourly earnings detail given how higher salaries put upwards pressure on inflation.

The Fed's decision on Wednesday to leave interest rates unchanged was widely expected. However, Fed chair Jerome Powell quashed recent concerns that resilient economic data could in fact lead to tighter monetary policy.

However, he did acknowledge that while interest rates are unlikely to rise further, there was a "lack of further progress" in bringing down inflation to target levels. "It's likely to take longer for us to gain confidence that we are on a sustainable path to 2% inflation," he said.

"The past month saw market expectations for the first Fed rate cut pushed from June to December, although Powell managed to moderately lift hopes of an earlier shift in November," said chief market analyst Joshua Mahony from Scope Markets.

"All eyes turn to Friday's US jobs report, with the average earnings figure expected to remain at a concerning 4.1%. With the quarterly employment cost index having surged to a lofty 1.2% this week, there is a distinct risk that we could similarly see average earnings strengthen to throw another curveball in the direction of the Fed."

Economic data in focus

On the macro front, jobless claims were unchanged at 208,000 in the week ended 27 April, according to the Labor Department, remaining at the lowest level in two months and firmly below market expectations for a reading of 212,000.

US employers announced 64,789 cuts in April, down 28% from March's 14-month high of 90,309 and the 66,995 cuts announced at the same time a year earlier, according to Challenger, Gray & Christmas. The reading was still consistent with a tight labour market, but with labour costs continuing to rise, companies will probably be slower to hire and likely to make further cuts in the coming months.

The US trade deficit in goods and services dipped by 0.1% month-on-month to reach $69.4bn, according to the Department of Commerce. Economists had forecast a deficit of -$69.1bn. Exports shrank 2.0% to reach $257.6bn, while imports were down by 1.6% at $327.0bn.

US workers' productivity slowed more sharply than anticipated at the start of 2024, pushing labour costs much higher. According to the Department of Labor, in seasonally adjusted terms labour productivity grew at a quarter-on-quarter pace of 0.3% over the three months ending in March (consensus: 0.8%) - principally due to an unexpected decline in output growth to 1.3% during the first quarter.

Finally, new orders for US-manufactured goods rose by 1.6% to $584.5bn in March, according to the Census Bureau, following a 1.2% increase in February. New orders expanded by 2.6% for durable goods industries, while non-durable goods orders rose by 0.6%.

Market movers

Moderna saw its share price surge on Thursday after posting a smaller-than-expected quarterly loss as the Covid vaccine maker sets its sights on regulatory approvals of its second product later in the year. The company reported a net loss of $1.2bn for the quarter, compared with a profit of $79m the year before, with the loss per share of $3.07 better than the $3.56 projected by analysts.

Goldman Sachs rose on reports that the bank will remove a cap on bonuses for its London-based staff. According to Sky News, the firm is now set to resume making multi-million-pound payouts to its top-performing traders and dealmakers.

Chipmaker Qualcomm jumped 10% on better-than-expected adjusted earnings and strong revenue guidance, pointing to sales of $8.8bn to $9.6bn in the current quarter, compared with analysts' expectations of $9.05bn.

Heading the other way was food delivery firm DoorDash which fell 10% after posting a wider-than-expected loss per share, even though revenues came in ahead of forecasts.

Peloton slipped 3% after announcing the departure of its chief executive, alongside plans to cut around 15% of its workforce amid a restructuring programme aimed at reducing annual expenses by more than $200m.

Apple was putting in decent gains ahead of its second-quarter earnings after the closing bell.

Dow Jones - Risers

Boeing Co. (BA) $178.85 4.31%

Nike Inc. (NKE) $92.41 2.29%

Apple Inc. (AAPL) $173.03 2.20%

Walt Disney Co. (DIS) $112.62 1.94%

Unitedhealth Group Inc. (UNH) $492.97 1.83%

Walmart Inc. (WMT) $59.71 1.46%

Caterpillar Inc. (CAT) $335.44 1.32%

Goldman Sachs Group Inc. (GS) $432.57 1.32%

Salesforce.Com Inc. (CRM) $272.13 1.28%

Walgreens Boots Alliance, Inc. (WBA) $17.53 1.10%

Dow Jones - Fallers

3M Co. (MMM) $96.84 -1.66%

Johnson & Johnson (JNJ) $149.96 -0.83%

Dow Chemical Co. (DOW) $56.83 -0.70%

Verizon Communications Inc. (VZ) $38.93 -0.69%

Merck & Co. Inc. (MRK) $128.26 -0.42%

McDonald's Corp. (MCD) $273.33 -0.42%

Cisco Systems Inc. (CSCO) $46.79 -0.11%

JP Morgan Chase & Co. (JPM) $191.66 -0.10%

S&P 500 - Risers

CH Robinson Worldwide Inc (CHRW) $80.78 12.05%

QUALCOMM Inc. (QCOM) $180.10 9.74%

Sealed Air Corp. (SEE) $34.92 8.82%

Borg Warner Inc. (BWA) $35.63 8.40%

Kellanova (K) $61.30 7.55%

Bread Financial Holdings, Inc. (BFH) $41.21 7.37%

Westrock Company (WRK) $51.11 6.70%

CenturyLink Inc. (LUMN) $1.30 6.61%

Nordstrom Inc. (JWN) $19.98 6.22%

Estee Lauder Co. Inc. (EL) $134.94 5.94%

S&P 500 - Fallers

Qorvo, Inc. (QRVO) $95.67 -14.50%

Baxter International Inc. (BAX) $36.91 -8.50%

Stanley Black & Decker Inc. (SWK) $84.97 -7.52%

Ametek Inc. (AME) $163.34 -6.12%

Teleflex Inc. (TFX) $198.91 -6.06%

DENTSPLY Sirona Inc. (XRAY) $28.38 -5.96%

CF Industries Holdings Inc. (CF) $73.87 -5.26%

Mosaic Company (MOS) $28.41 -5.08%

IQVIA Holdings Inc. (IQV) $222.14 -4.64%

Apache Corp. (APA) $29.18 -4.33%

Nasdaq 100 - Risers

Qurate Retail Inc. (QRTEA) $0.94 12.00%

JD.com, Inc. (JD) $32.64 11.51%

QUALCOMM Inc. (QCOM) $180.10 9.74%

Baidu Inc. (BIDU) $111.75 7.12%

NetEase Inc. Ads (NTES) $98.84 5.13%

Trip.com Group Limited (TCOM) $50.94 4.51%

Regeneron Pharmaceuticals Inc. (REGN) $937.61 3.78%

Mercadolibre Inc. (MELI) $1,505.99 3.40%

Nvidia Corp. (NVDA) $858.17 3.34%

Amazon.Com Inc. (AMZN) $184.72 3.20%

Nasdaq 100 - Fallers

DENTSPLY Sirona Inc. (XRAY) $28.38 -5.96%

eBay Inc. (EBAY) $49.39 -3.27%

Automatic Data Processing Inc. (ADP) $242.03 -2.14%

Gen Digital Inc. (GEN) $19.68 -1.35%

Biogen Inc (BIIB) $213.51 -1.21%

Ulta Salon, Cosmetics & Fragrance Inc. (ULTA) $397.33 -1.19%

Western Digital Corp. (WDC) $69.72 -1.12%

Paychex Inc. (PAYX) $118.45 -0.80%

Skyworks Solutions Inc. (SWKS) $89.72 -0.64%

Illumina Inc. (ILMN) $123.99 -0.55%