After a larger-than-expected reduction in first-time claims for jobless benefits a day ahead of the June jobs data, U.S. markets went slightly higher Thursday, with the S&P 500 extending its run into record territory. What is the current state of equity benchmarks?
The Dow Jones Industrial Average DJIA, +0.21% was up 5.55 points at 34,508.06, up 0.21 percent.
The S&
The Nasdaq Composite COMP, +0.04 percent rose 12.20 points, or 0.1 percent, to 14,516.15.
The S&P 500 advanced 5.70 points, or 0.1 percent, to 4,297.50 on Wednesday, surpassing its total number of record finishes in 2020; the Dow finished 210.22 points higher at 34,502.51, a gain of 0.6 percent, bringing the blue-chip benchmark within 1% of its May 7 record close of 34,777.76. The Nasdaq Composite Index dropped 24.38 points, or 0.2 percent, to 14,503.95, its lowest level in three sessions.
What is the market’s driving force? Investors are taking a cautious approach to July and the start of the third quarter. The economy is rebounding from the COVID pandemic, but there are still concerns about the job market and inflation, which might undermine the euphoric feeling that has kept all three major stock indexes at or near all-time highs following their best first-half results since 2019. The Labor Department said that first-time unemployment claims fell to 364,000 last week, down from 411,000 the week before. Economists predicted a drop to 380,000. The findings came ahead of Friday’s monthly payrolls estimates from the Labor Department and a better-than-expected update on private-sector employment from ADP on Wednesday. “Today’s jobless claims report is a great bright spot. “Not only did we print the lowest number since the epidemic began, but it also reverses the recent trend of misses,” said Cliff Hodge, chief investment officer for Cornerstone Wealth. “Staying below that big-round-number [400,000] mark could boost risk-taking confidence during the dog days of summer,” he said. Meanwhile, the final reading of IHS Markit’s June manufacturing PMI in the United States was 62.1, down from a flash estimate of 62.6 but unchanged from the May final figure. According to Chris Williamson, Chief Business Economist at IHS Markit, the industrial upturn has been bolstered by further significant increases in output and new orders, although supply chain disruptions have deteriorated and weighed on production capacity. Meanwhile, input costs soared to new highs, resulting in yet another record surge in factory selling prices. The manufacturing sector survey from the Institute for Supply Management is coming at 10:00 a.m. ET. At 10 a.m., a report on construction spending is also due. Atlanta Federal Reserve President Raphael Bostic is scheduled to talk at 2 p.m., among the Fed speakers. In an interview with Bloomberg TV on Wednesday, Dallas Fed President Rob Kaplan said the Fed should start slowing down, or tapering, its asset purchases before the end of the year. Investors may also be keeping an eye on international headlines, as President Xi Jinping celebrated the Chinese Communist Party’s 100th anniversary on Thursday with a stern address urging foreign nations not to “bully” China unless they want “their skulls bashed.” Oil futures were surging ahead of a meeting of the Organization of Petroleum Exporting Countries and its allies, known as OPEC+, where an agreement to increase output by around 500,000 barrels per day starting in August was expected — a rise that would be easily absorbed by the market as the global economy picks up steam. According to a renowned economist, oil might hit $100 as the commodities boom swings away from China. In public health news, the World Health Organization announced that a 10-week reduction in new cases in Europe has ended, with cases increasing by 10% last week. According to the Guardian, WHO regional director for Europe Hans Kluge said the spike is due to reduced regulations and increasing mobility, and that if discipline isn’t maintained, a new wave will arise. Which businesses are being scrutinized?
Shares of McCormick & Co. MKC declined 0.6 percent after the spice and flavorings producer topped expectations for the fiscal second quarter and upped guidance.
MKS Instruments Inc. is a company that manufactures instruments.
MKSI announced on Thursday that it has struck an agreement to buy Atotech Ltd. ATC in a cash-and-stock deal worth $5.1 billion in equity and $6.5 billion in enterprise value.
MKS shares were down 5.8%, while Atotech was down 2.7 percent.
Elliott Management has called on GlaxoSmithKline GSK, +0.55 percent to appoint new directors to its board of directors and launch a process to determine the future of Emma Walmsley, the company’s troubled CEO.
Late Wednesday, Krispy Kreme Inc. priced its initial public offering at $17 per share, well below the estimated range of $21 to $24 per share. The stock is set to start trading on the Nasdaq on Thursday under the ticker symbol “DNUT” DNUT.
NIO Inc. NIO, -0.47% climbed 1.8 percent after the firm announced that it delivered 8,083 vehicles in June, jumping 116.1 percent from the same month a year ago.
What are the trends in other markets?
The 10-year Treasury note yield TMUBMUSD10Y, 1.470 percent, increased by one basis point to 1.459 percent. The yield curve and the price of debt move in opposite directions.
The ICE U.S. Dollar Index DXY, -0.04%, a measure of the currency against a basket of six main competitors, was down 0.1 percent.
Gold futures GCQ21, +0.28 percent nudged up 0.6 percent to $1,782.20 an ounce, while the US oil benchmark CL00, +2.27 percent was up 3.4 percent at $75.96 a barrel.
In European shares, the Stoxx 600 Europe SXXP, +0.60 percent gained 0.5 percent, while London’s FTSE 100 UKX, +1.16 percent gained 0.9 percent.
In Asia, the Shanghai Composite SHCOMP, -0.07% was down 0.1 percent, while Japan’s Nikkei 225 NIK, -0.29% was down 0.3 percent./n
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