4:05pm: Wall Street in the green
Investors cheered after the House passed a bill to raise the debt ceiling late Wednesday evening.
At the close, the S&P 500 saw a nearly 1% gain to close at 4,221, the Dow finished around 0.5% higher at 33,062 and the Nasdaq had the biggest lead of the three major indices, up 1.3% at 13,101.
Tomorrow, traders will get a look at the latest US jobs data - and what that might mean for interest rates. Analysts are expecting the economy to add 195,000 jobs.
"US interest rate hike expectations have been flying all over the place in the past three weeks," wrote James Knightley of ING.
"The market has now settled on around a 25% chance of a 25bp hike on 14 June, but a strong jobs reading on Friday could easily swing things back in favour of a hike."
3:05pm: What's in store for Dell?
Dell Technologies Inc is expected to report a year-over-year decline in earnings on lower revenues when the company announces its first-quarter 2024 financial results today after the markets close.
According to the Zacks Consensus Estimate, the computer and technology services provider is anticipated to post quarterly earnings of $0.86 per share, representing a year-over-year decline of about 53%, while the company’s revenue for the period is expected to fall nearly 23% to $20.2 billion.
Dell handily beat the analyst consensus during its fiscal fourth quarter, due to solid sales of servers, storage and infrastructure gear, but the company issued a cautious outlook for its upcoming fiscal year.
12:05pm: Stocks off to a positive start in June
US stocks were higher in noon trading after the House of Representatives passed a bill Wednesday evening to raise the country’s debt ceiling.
At midday, the Dow rose 183 points to 33,091, while the S&P 500 added 35 points at 4,215 and the tech-heavy Nasdaq gained 135 points to 13,070.
“A lot of the market focus is shifting from whether the government is going to default on its debts, which was never going to happen, to the more pressing issue of how much further interest rates are going to rise,” Harris Financial managing partner Jamie Cox said.
Notable movers included shares of C3.ai Inc, which fell more than 11% after the artificial intelligence company issued disappointing guidance for its fiscal first quarter.
9:41 am: Markets open little changed
Shortly after the opening bell, the Dow was down 168 points, 0.5%, to 32,741, the Nasdaq composite declined 24 points, 0.2%, to 12,911 and the S&P 500 slid 4 points, 0.1%, to 4,176.
The market didn't react particularly strongly to the passage of a debt ceiling deal in the House Wednesday evening.
“The House passing a debt ceiling bill is an important step towards moving past this issue, and the market has been pricing in a resolution on the debt ceiling for some time,” said Michael Landsberg, chief investment officer of Landsberg Bennett Private Wealth Management. “While the debt ceiling added to headline risk, it was largely ignored by the stock market amid expectations that this issue would be resolved.”
The bill now heads to the Senate.
7:55am: Jobs back in the spotlight
Wall Street is likely to open flat to higher after the US House of Representatives passed a bill to raise the debt ceiling above the current $31.4 trillion, shifting the focus to employment data today and tomorrow that will help guide the Federal Reserve’s interest rate decision later this month.
Futures for the Dow Jones Industrial Average were steady in Thursday pre-market trading, while those for the broader S&P 500 index gained 0.2% and contracts for the Nasdaq-100 added 0.1%.
After the House voted 314 to 117 in favor of the bill on Thursday, the Senate has until the June 5 deadline to enact the legislation and get President Joe Biden’s signature before the federal government runs out of cash.
The main US indexes were lower at Wednesday’s close as growth concerns outweighed optimism about the debt deal due to weak economic data from China and after the Chicago PMI missed expectations by a mile. The DJIA lost 0.4% to 32,908, the S&P 500 finished 0.6% lower at 4,180 and the Nasdaq also slipped 0.6% to end the day at 12,935 points.
“Stock markets are finding some relief after the US debt limit deal was approved by the House, with the Senate’s vote now set to be a formality,” commented Han Tan, chief market analyst at Exinity Group.
“Still, risk appetite appears to be muted after the mixed signals this week surrounding China’s recovery, as well as the dwindling prospects of Fed rate cuts later this year."
Apart from the release of the ADP employment report today, Tan said the monthly non-farm payroll (NFP) numbers tomorrow and upcoming consumer price index (CPI) data will hold sway over the Fed’s next interest rate moves.
“If hiring momentum in the US jobs market softens meaningfully that should allow the Fed to pause its aggressive rate hikes. Such hopes should carve out more breathing space for the likes of equities and gold,” Tan said.
“However, risk assets are likely to face a tough time sustaining a relief rally until US interest rates have well and truly reached their peak, despite recent Fed speak suggesting a June pause," he added. "Markets remain cognizant that a recession still looms large on the horizon, with such prospects likely to cap the upside in stocks in the interim.”