U.S. stocks were mixed Thursday, highlighted by a vault upward by tech stocks following the Federal Reserve’s latest interest rate hike and ahead of another batch of earnings from the tech industry’s biggest players.
The technology-heavy Nasdaq Composite (^IXIC) soared by more than 3% in midday trading. The S&P 500 (^GSPC) added 1.3%, while the Dow Jones Industrial Average (^DJI) lagged, dipping 0.3%.
The yield on the benchmark 10-year U.S. Treasury note ticked down to 3.358% Thursday morning. The dollar index increased 0.12% to $101.33
The major U.S. stock averages closed higher on Wednesday following the Federal Reserve’s highly anticipated rate hike to 25 basis points, which represented another slowdown in its inflation-fighting campaign. Chairman Jerome Powell’s upbeat comments on the state of inflation moved markets higher.
The Fed’s decision follows recent economic data that shows more evidence of decelerating inflation over the past few months, though Powell stressed the Fed’s campaign is far from over.
WASHINGTON, DC – FEBRUARY 01: Federal Reserve Board Chairman Jerome Powell speaks during a news conference after a Federal Open Market Committee meeting on February 01, 2023 in Washington, DC. The Federal Reserve announced a 0.25 percentage point interest rate increase to a range of 4.50% to 4.75%. (Photo by Kevin Dietsch/Getty Images)
The macro picture was mixed on Wednesday, with ISM’s latest manufacturing PMI declining and missing consensus expectations. Meanwhile, private payrolls added 106,000 jobs in January, down from the 170,000 expected by economists.
The next major event on the macroeconomic front is Friday’s January jobs report, which will be critical for investors to further assess if there’s evidence of an easing labor market.
December’s jobs report showed that the labor market remains strong, as employers added a robust 233,000 jobs for the month and an average monthly increase of 375,000 throughout last year.
The number of Americans filing new unemployment claims fell to 183,000 for the week ended Jan. 28, the Labor Department said on Thursday, down from 195,000 expected by economists.
On the earnings front, Meta Platforms (META) reported fourth quarter results after the bell that topped revenue expectations, while delivering a $5 billion expense cut. It also announced a $40 billion stock buyback. Shares of the social media giant surged more than 23% in midday trading Thursday morning.
The S&P 500’s most heavily weighted components — Amazon (AMZN), Apple (AAPL), Alphabet (GOOG) — are gearing up to report quarterly results on Thursday after the bell. All were up at least 3% in Thursday trading.
Merck & Co. (MRK) posted better-than-expected fourth quarter earnings, but forecasted softer near-term profits, sending shares lower on Thursday. The company reported adjusted earnings at $1.62 per share, down 10% from the same period last year, but up from the consensus estimates of $1.54 per …….