2024-01-05 17:29:35
(For a live Archyde.com blog on US, UK and European stock markets, click LIVE/ The S&P 500 and Nasdaq rose on Friday following services sector data pointing to a weaker economy increased bets for further cuts interest rates this year, hours following robust jobs data reduced expectations for rapid easing. Financial stocks and big tech companies accounted for most of the gains, with Bank of America BAC .N and JPMorgan Chase JPM.N rising between 0.5% and 2%, while Amazon.com AMZN.O, Nvidia NVDA.O and Microsoft MSFT.O rose slightly between 0.7% and 2.7%. An Institute for Supply Management (ISM) survey showed activity in the services sector, which accounts for more than two-thirds of the economy, fell to 50.6 in December from 52.7 the month before. Economists polled by Archyde.com had forecast 52.6. The yield on the benchmark 10-year U.S. Treasury bond US10YT=RR, which reflects interest rate expectations, saw gains following the data release and stood at 3.998%. US/ Markets initially reduced bets for an interest rate cut in March following a Labor Department report showed that US employers hired more workers than expected in December, while increasing salaries at a sustained rate. According to CME Group’s FedWatch tool, 71% of traders now believe there is at least 25 basis points of decline in March, up from nearly 55% earlier in the day. “Employment is lower than reported when factoring in the revisions,” said Thomas Hayes, president of Great Hill Capital. “And ISM non-manufacturing data also came in below estimates, pointing to Fed cuts sooner rather than later, and that’s what the market likes. Financial stocks .SPSY led the gains among 11 S&P 500 sectors up 0.6%, reaching a high in more than a year and a half. The S&P 500 .SPX is still on track for its worst weekly performance since the end of October , as investors cashed in their gains following a nine-week run of gains due to bets that an interest rate cut was imminent. The Nasdaq .IXIC is on track for its worst week since the end of the month September, driven by a rotation from technology stocks into defensive sectors such as health care, financial services and utilities. As of 11:53 a.m. ET, the Dow Jones Industrial Average .DJI was up 30.49 points, or 0.08%, to 37,470.83, the S&P 500 .SPX was up 18.06 points, or 0.39%, to 4,706.74, and the Nasdaq Composite .IXIC was up 62.57 points, or 0.43%, to 14,572.87. Applied Therapeutics APLT.O fell 36.8% following the developer’s heart disease drug showed disappointing results in a late-stage trial. Palantir Technologies PLTR.N lost 2.1% following Jefferies downgraded the data analytics company to “underperform” due to high stock valuations. Peloton PTON.O jumped 11.1% following the fitness equipment maker said it would bring its workout content to short-video platform TikTok in an exclusive partnership. Later in the day, investors will analyze remarks from Richmond Fed President Thomas Barkin, a voting member this year. Rising stocks outnumbered falling stocks by a ratio of 2.21 to 1 on the NYSE and 1.16 to 1 on the Nasdaq. The S&P recorded 12 new 52-week highs and no new lows, while the Nasdaq recorded 33 new highs and 52 new lows.
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