Major Averages Remain Firmly Positive In Afternoon Trading
Stocks moved mostly higher early in the session and continue to turn in a strong performance in afternoon trading on Thursday. The major averages are extending the rally seen late in the previous session, reaching new record intraday highs.
Currently, the major averages are off their highs of the session but still firmly positive. The Dow is up 334.46 points or 0.9 percent at 39,846.59, the Nasdaq is up 104.07 points or 0.6 percent at 16,473.48 and the S&P 500 is up 29.15 points or 0.6 percent at 5,253.77.
The extended upward move on Wall Street comes as stocks continue to benefit from positive reaction to yesterday’s monetary policy announcement by the Federal Reserve.
While the Fed left interest rates unchanged, as widely expected, the central bank also maintained its forecast for three interest rate cuts this year.
The unrevised rate cut forecast is seen as bullish for stocks, as some investors had been worried recent hotter-than-expected inflation data could lead Fed officials to reconsider lowering rates.
“We view today’s FOMC interest rate decision and press conference as bullish for the equity markets and soft landing scenario,” Larry Tentarelli, President and Founder, Blue Chip Daily Trend Report, said on Wednesday.
“A concern that we had going into was the recent higher than forecast CPI readings,” he added. “The FOMC dot plot (FOMC members projections for future interest rate levels) remained unchanged at 3 cuts expected for 2024, which we view as a major positive.”
In U.S. economic news, the Labor Department released a report unexpectedly showing a slight drop by first-time claims for U.S. unemployment benefits in the week ended March 16th.
The Labor Department said initial jobless claims edged down to 210,000, a decrease of 2,000 from the previous week’s revised level of 212,000.
The dip surprised economists, who had expected jobless claims to rise to 215,000 from the 209,000 originally reported for the previous week.
The National Association of Realtors also released on report showing existing home sales unexpectedly continued to soar in the month of February.
NAR said existing home sale index spiked by 9.5 percent to an annual rate of 4.38 million in February after jumping by 3.1 percent to a rate of 4.00 million in January.
The continued surge came as a surprise to economists, who had expected existing home sales to pull back by 1.5 percent to a rate of 3.94 million.
With the unexpected increase, existing home sales reached their highest level since hitting an annual rate of 4.530 million in February 2023.
Sector News
Semiconductor stocks continue to see substantial strength on the day, resulting in a 3.7 percent spike by the Philadelphia Semiconductor Index.
Micron (MU) has helped lead the sector higher, with the chipmaker soaring by 16.7 percent after reporting better than expected fiscal second quarter results and providing upbeat fiscal third quarter guidance.
Considerable strength is also visible among computer hardware stocks, as reflected by the 2.1 percent surge by the NYSE Arca Computer Hardware Index.
Brokerage stocks have also shown a significant move to the upside, driving the NYSE Arca Broker/Dealer Index up by 2.0 percent to a record intraday high.
Networking, housing and banking stocks are also seeing notable strength on the day, reflecting broad based buying interest.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index soared by 2.0 percent, while Hong Kong’s Hang Seng Index shot up by 1.9 percent.
Most European stocks also moved to the upside on the day. While the U.K.’s FTSE 100 Index surged by 1.9 percent, the German DAX Index jumped by 0.9 percent, the French CAC 40 Index edged up by 0.2 percent.
In the bond, treasuries have shown a lack of direction over the course of the session after seeing initial strength. Currently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 4.281 percent.
For comments and feedback contact: editorial@rttnews.com