US stocks near record level amid earnings, jobs data
The benchmark S&P 500 index has managed to eke out a small gain after briefly hitting the 5,000-point milestone as investors reacted to earnings reports, a roughly in-line US jobs report and remarks from policymakers on interest rate cuts.
Under the hood, small-cap indices outperformed large caps and semiconductor stocks also outperformed with shares of chip designer ARM Holdings surging 47.9 per cent after it forecast strong demand for designs related to artificial intelligence.
Shares of Walt Disney rose 11.5 per cent on Thursday after the media giant's profit beat Wall Street estimates and it announced a $US3 billion share repurchase plan, a 50 per cent dividend increase, a gaming investment and plans for an ESPN streaming service in 2025.
Spirit Airlines shares rose 3.3 per cent after the airline said it expected to operate with a positive cash flow from the second quarter after reporting a narrower-than-expected loss.
More than half of the S&P 500 companies have reported quarterly earnings, with 80.6 per cent surpassing expectations, compared with a long-term average of 67 per cent, according to LSEG data.
On the economic data front, the number of Americans filing new claims for unemployment benefits fell slightly more than expected last week, suggesting underlying labour market strength.
"In what appears to be a sleepy day there are some things under the surface. There's more of a risk-on appetite. Semiconductors continue to show leadership," said Keith Lerner, co-chief investment officer at Truist Advisory Services in Atlanta.
"We've had such outperformance in megacaps, investors are looking for other opportunities, even in technology they're going down the market cap scale," said Lerner, referring to a stronger gain in the S&P 600 tech sector than the S&P 500 tech sector.
The Dow Jones Industrial Average rose 48.97 points, or 0.13 per cent, to 38,726.33, the S&P 500 gained 2.85 points, or 0.06 per cent, to 4,997.91 and the Nasdaq Composite gained 37.07 points, or 0.24 per cent, to 15,793.72.
While its gains were muted, the S&P 500 notched a record high for the second day in a row as investors looked past uncertainty on the timing of interest rate cuts and jitters about some regional banks.
The Russell 2000 small-cap index outperformed during the session and closed up 1.5 per cent.
The Philadelphia semiconductor index ended up 1.6 per cent as the sector is seen as a key beneficiary of AI technology.
Among the S&P 500's 11 major sectors, energy led major-sector gains to finish up 1.1 per cent as crude prices rose.
Richmond Fed president Thomas Barkin said recent stronger-than-expected data on the US economy might be partly due to the difficulty of making accurate seasonal adjustments around the beginning of the new year.
PayPal shares sank 11.2 per cent after a forecast of flat growth in adjusted profit for the current year.
Ralph Lauren stock rallied 16.8 per cent following a third-quarter revenue beat, while apparel maker Under Armour closed up 0.1 per cent after raising its annual profit forecast.
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