Stocks rallied on Thursday as investors looked ahead to more corporate earnings and a key labor report set for later in the week. The Dow Jones Industrial Average added over 300 points, closing at 38,225.66. The S&P 500 and Nasdaq Composite also posted gains, with the S&P 500 settling at 5,064.20 and the Nasdaq ending at 15,840.96. Markets appeared relieved after the Federal Reserve meeting was less hawkish than feared, with investors still expecting delayed rate cuts, but not necessarily derailed.
Chipmaker Qualcomm saw a 9.7% increase in stock price following better-than-expected earnings and strong revenue guidance. However, restaurant delivery service DoorDash experienced a 10.3% drop after reporting a wider loss per share. Used car retailer Carvana soared by 33.8% after reporting its best-ever earnings, while Moderna also surged by 12.7% on a smaller-than-expected loss. Megacap technology stocks like Nvidia and Amazon rose more than 3% each, as Apple saw a 2.2% increase ahead of its quarterly earnings report after the bell.
The Federal Reserve’s decision to keep interest rates unchanged and Fed Chair Jerome Powell’s indication that an interest rate hike is not the next move led to a choppy day on Wall Street. Traders are currently only pricing in a 14% chance of a rate cut in June based on futures market pricing. Investor focus has shifted to Friday’s April nonfarm payrolls report, with economists anticipating 240,000 job gains, a slowdown from March’s 303,000 additions. The report will help gauge employment and overall economic health.
Wall Street is also keeping an eye on signs of easing wage and price pressures, with concerns that hot economic and labor market data may cause the Fed to postpone rate cut plans. Chief market strategist at Ameriprise, Anthony Saglimbene, noted that if the nonfarm payrolls report shows solid employment but is below the previous month’s figure, stocks are likely to respond positively. Earnings season continued with reports from Apple, Amgen, Coinbase, and DraftKings after the bell on Thursday.
Overall, the market’s response to recent economic indicators and corporate earnings has been positive, with investors cautiously optimistic about the future trajectory of interest rates and economic growth. Despite some fluctuations in stock prices, particularly in response to individual company earnings reports, the broader market trend has remained upward. With the labor market report set for release on Friday, investors will be closely watching for any signs of ongoing strength or possible shifts in employment trends that could impact market sentiment moving forward.
