Stock market news today: S&P 500, Nasdaq climb as Fed delivers and Meta jumps
08/01/2024 20:38
Strong Meta results are keeping bullish tech hopes aloft after the Fed cemented bets on a September rate cut.
US stocks resumed their rally on Thursday, as upbeat Meta (META) results put earnings center stage again after the Federal Reserve boosted hopes for a September rate cut.
The S&P 500 (^GSPC) rose 0.4% while the tech-heavy Nasdaq Composite (^IXIC) gained roughly 0.4%, after the indexes closed with hefty gains. The Dow Jones Industrial Average (YM=F) edged up about 0.1%.
Stocks are on the rise after Fed chair Jerome Powell bolstered the market's confidence in a September interest-rate cut, saying it "could be on the table." Traders mostly expect a 25-basis-point reduction, but bumped up bets on a 50-basis-point move after policymakers held rates steady.
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The focus is now on quarterly results, especially from Big Tech names, after Meta's strong report late Wednesday. Shares in the Facebook owner climbed over 8% as the market appraised its earnings beat and signs that solid digital ad revenue will give its AI investments time to pay off.
Earnings from Apple (AAPL) and Amazon (AMZN) due after the bell could test the Meta-driven bullishness for techs. They will also test the chances the AI trade can deliver on its promise, which took a hit from earlier disappointing "Magnificent Seven" earnings.
Weekly jobless claims rose to an 11-month high, data out early Thursday showed. The print will pave the way for Friday's release of the July jobs report, watched closely for further evidence of the cooling labor market crucial to Fed policy.
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Stocks open higher after Fed decision, Meta jumps 8%
Stocks opened higher on Thursday to build on the prior session's rally after the Federal Reserve laid the groundwork for a September rate cut and social media giant Meta (META) reported better than expected results.
The S&P 500 (^GSPC) climbed 0.4% while the tech-heavy Nasdaq Composite (^IXIC) gained almost 0.5%. The Dow Jones Industrial Average (^DJI) edged up 0.4%.
Stocks rose after Fed chair Jerome Powell said on Wednesady a September interest-rate cut "could be on the table."
Meta shares rose about 8% after a strong quarterly report. Like other Big Tech firms, Meta said it sees "significant" capital expenditures growth in 2025 as it builds out its AI focused infrastructure.
Jobless claims rise more than expected
Weekly jobless claims once again rose more than expected last week in the latest sign of a cooling labor market.
New data from the Department of Labor showed 249,000 initial jobless claims were filed in the week ending July 27, up from 235,000 the week prior and above the 235,000 economists had expected. This marked the highest level of weekly filings since August 2023.
Meanwhile, the number of continuing applications for unemployment benefits once again hit its highest level since November 2021, with 1.877 million claims filed in the week ending July 20, up from 1.84 million the week prior.
"The claims data of the past few weeks have been signaling incremental labor market weakness, albeit from a position of strength," Jefferies US economist Thomas Simons wrote in a note on Thursday. "This is another step in the process of the labor market coming into better balance, but we must remain vigilant in watching for signs of slack. We are particularly concerned about a negative impulse in the labor market data, but things can deteriorate quickly once they start."
