4:11pm: Indexes falter in the afternoon
The Dow closed Thursday down 238 points, 0.7%, at 35,283, the Nasdaq Composite lost 77 points, 0.6%, to 14,050 and the S&P 500 dipped 29 points, 0.6%, to 4,537. The small-cap Russell 2000 index declined 30 points, 1.5%, to 1,951.
An afternoon swoon from the benchmarks snapped the Dow's historic winning streak at 13 days, its longest such streak since 1987. Had the index closed higher Thursday, it would have tied a streak set back in 1897, just a year after the Dow was created.
A chunk of the blame can be laid at the feet of DJIA component Honeywell, shares of which fell more than 5% after the company reported lower-than-expected revenue.
Meanwhile, a rise in the 10-Year Treasury Yield to above 4% also may have spooked investors.
12:05pm: Strong GDP data helps Dow's historic winning streak
US stocks were higher in noon trading on better-than-expected financial results and guidance from Meta Platforms along with stronger-than-expected GDP data.
At midday, the Dow gained 20 points to 35,540, while the S&P 500 added 20 points at 4,587 and the tech-heavy Nasdaq rose 137 points to 14,264.
“Those very high rates that scared me and the market earlier on in the year don’t seem to be having as much of a negative effect as I had feared,” Wharton School’s Jeremy Siegel said.
“And that, combined with the fact that Powell now is saying I’m going to look at both sides of the equation, I think is very positive for the markets,” he added.
Other notable movers included shares of Align Technology, Inc, which surged 16% after the orthodontics company surpassed Wall Street expectations on both its top and bottom lines during 2Q as well as for its revenue forecast.
9:40am: 2Q economic growth exceeds expectations
Tech stocks charged higher at the open driven by an earnings-inspired rally in Meta stock.
Just after the market opened, the tech-laden Nasdaq had added 210 points or 1.5% at 14,337 points, the S&P 500 was up 40 points or 0.9% at 4,607 points, and the Dow Jones was up 102 points or 0.3% at 35,622 points.
Also boosting investor sentiment was new data from the Bureau of Economic Analysis (BEA) which showed the US economy grew faster than expected during the second quarter.
Per the BEA’s advance estimate of US 2Q gross domestic product (GDP), the economy grew 2.4% at an annualized rate, up from 2% in the first quarter.
Analysts had expected growth of 1.8%, according to a Bloomberg survey.
The increase reflected increases in consumer spending, non-residential fixed investment, state and local government spending, private inventory investment, and federal government spending, partly offset by decreases in exports and residential fixed investments, the BEA said.
7:45am: Meta earnings lift Nasdaq
US stocks are expected to push higher again after the Federal Reserve, as expected, instituted a 25 basis point hike interest rate hike on Wednesday, with eyes on more corporate earnings and some data.
In pre-market trading, futures for the Dow Jones Industrial Average (DJIA) were 0.2% higher, while those for the broader S&P 500 added 0.6%.
But contracts for the Nasdaq-100 jumped 1.2% helped by more upbeat tech earnings. Facebook owner Meta Platforms shares popped nearly 7% in extended trading on better-than-expected results and strong guidance.
In regular trading on Wednesday, the Nasdaq Composite lost 0.1%, while the S&P 500 dipped 0.02%. However, the DJIA rose for a 13th straight session, gaining 82 points, or 0.2% to close at 35,52, notching up its longest win streak since 1987. If the DJIA ends Thursday with a 14th straight positive session, it will mark the longest winning streak for the 30-stock average since June 1897.
The moves came after the Fed announced its widely-expected hike, bringing interest rates to their highest level since 2001. Remarks from Fed chair Jerome Powell hinted that the central bank could also hold rates steady at these levels, and suggested that the Federal Open Market Committee will remain data-dependent.
Joshua Mahony, chief market analyst at Scope Markets commented: "The 25-basis point hike had been largely baked in, but Jerome Powell managed to provide markets with a little more juice for traders to get into. Firstly, the FOMC considers every meeting as being ‘live’, with their data dependency likely to provide a bumpy ride given the potential rise in CPI over the next two readings. However, Powell also noted that he deems current policy as being ‘restrictive’, with the committee expecting to see inflation return to 2% without major job losses."
"For markets, this signals a general satisfaction with policy as it stands, with Fedwatch pricing for another 2023 rate hike declining from 32% to 28%. That growing optimism that the Fed may have reached a terminal rate brought gains for equities, with the dollar coming under pressure," he added.
The US central bank meets again in September after a batch of new inflation and employment data. Economic data due on Thursday include initial weekly jobless claims, June durable goods orders, a preliminary second-quarter GDP reading and pending home sales.
It is another packed earnings day, with results expected from Honeywell, McDonald’s, Intel, Ford Motor, and Royal Caribbean.