4:12pm: Markets stabilize
Wall Street ended Thursday on mixed ground as markets stabilized following Wednesday's sharp selloff triggered by the Federal Reserve's cautious outlook on interest rate cuts for 2025.
The Dow Jones closed at 42,342, essentially flat for the day. The S&P 500 edged lower by 0.1% to 5,867, while the Nasdaq also dipped 0.1% to 19,373.
This relatively muted performance came after Wednesday's significant downturn, which saw the Dow fall 2.6% and extend its losing streak to ten consecutive sessions - its longest since 1974. The slight recovery in the Dow today ends this streak.
Investors continued to digest the Federal Reserve's decision to cut interest rates by 25 basis points, as expected, but were particularly focused on the central bank's projection of only two rate cuts in 2025, down from the four cuts previously anticipated.
Despite the day's stabilization, market sentiment remains cautious as traders reassess their expectations for monetary policy in the coming year. The 10-year Treasury yield, which is sensitive to rate expectations, remained elevated at 4.55%.
3:01pm: Oklo on the move
Oklo shares gained another 17% on Thursday afternoon following news of a partnership with data center provider Switch.
Yesterday, news broke of Oklo’s 20-year agreement for its nuclear powerhouses to provide 12 gigawatts of power to Switch's data centers, which was described as a "framework for collaboration” by both companies, and Oklo CEO Jacob DeWitte said the partnership will accelerate the deployment of its powerhouses and demonstrate long-term customer demand.
Wedbush analysts have initiated coverage of the Santa Clara-based SMR manufacturer with an ‘Outperform’ rating and a $26 price target, citing the company’s differentiated business model and strong momentum leading into 2025.
1:25pm: Dow eyes longest losing streak break in nearly 50 years
Stocks are rebounding, recovering from Wednesday's sharp selloff triggered by the Federal Reserve's updated interest rate projections.
The Dow Jones is up 0.5% at 42,547, aiming to break its 10-day losing streak—the longest since 1974. The S&P 500 has climbed 0.4% to 5,897, while the Nasdaq has risen 0.4% to 19,473.
This recovery follows Wednesday's steep losses across all three major indices after the Fed announced it expects only two interest rate cuts in 2025, down from the previously anticipated four.
The more cautious outlook spurred the worst market day since summer, with the Dow plunging over 1,100 points.
Adding to the day's economic highlights, the U.S. GDP growth for Q3 was revised upward to 3.1%, exceeding earlier estimates, and weekly jobless claims dropped to 220,000, beating economist predictions.
12:05pm: No Santa rally?
The Federal Reserve's unexpected "hawkish cut" has unsettled markets, leading to a swift selloff, IG's Chris Beauchamp noted.
“The drop certainly dented hopes of a Santa rally this year, though perhaps we may still manage a modest bounce," Beauchamp said.
"Short-term oversold conditions, and the indiscriminate nature of the selling across global stocks, could mean a bit of bargain-hunting does take place, which might at least lead to a short-term recovery. If nothing else, Jerome Powell has at least delivered a much-needed check to some of the bullish complacency seen among investors of late.”
11:20am: Micron downgraded by BofA
Micron Technology Inc (NASDAQ:MU) (Micron Technology Inc (NASDAQ:MU)) has been downgraded by Bank of America to ‘neutral’ from ‘buy’, with analysts citing underwhelming sales guidance and ongoing margin pressure.
Micron underwhelmed with its second-quarter guidance on Wednesday as the chipmaker delivered a forecast of $7.9 billion, missing both BofA's estimate of $8.3 billion and the consensus forecast of $9 billion.
Gross margins for the quarter were forecast at 38.5%, below expectations of 40%.
BofA highlighted persistent weaknesses in the PC and phone markets as key drivers of the downgrade. Challenges in NAND flash memory pricing and inventory management are also expected to weigh on performance.
10.03am: Stocks gain
The Dow Jones Industrial Average is off to a good start this morning, adding 266 points in the opening 30 minutes to bring the Wall Street benchmark to 42,593 at the time of writing.
Traders are hoping to see the Dow close in the green following 10 straight days of losses- the worst run since the 1970s.
Key to Dow closing in the green today will be a recovery on UnitedHealth Group Inc (NYSE:UNH, ETR:UNH)’s price, although the group’s stock is currently down by 1.5%.
Nvidia Corp, however, is boosing the index with a 1.65% gain.
The Nasdaq 100 tech index has added 100 points in the opening 30 minutes, while the broader S&P 500 is up 38 points to 5,910.
9am: US jobless claims drop faster than expected
Those filing initial claims for unemployment benefits across the US fell by more than expected last week, figures showed on Thursday.
Some 220,000 new jobless claims were recorded over the course of last week, according to the Labor Department.
Analysts had expected a reading of 230,000, with the figure marking a 22,000 drop from the 242,000 initial claims seen a week earlier.
6.01am: US indexes to rise
US indexes are expected to make gains across the board when trading commences today, following a Wednesday slump in response to the Federal Reserve opting to hold interest rates for the moment.
The Dow Jones Industrial Average will have another go at overcoming its Nvidia Corp problem.
Chipmaking monolith Nvidia joined the 30-strong Wall Street index in early November in place of troubled competitor Intel Corp (NASDAQ:INTC, ETR:INL).
In a case of bad timing, Nvidia’s recent slump has caused the DJIA to fall for 10 trading sessions straight. But pre-market trades suggest a 200-point bounce when trading commences, bolstered by an expected 1.8% gain on Nvidia shares.
The Nasdaq 100 is tipped to open around 100 points, or approximately half a percentage point, higher.
The broader S&P 500 index is also set to open half a percentage point higher.
On the earnings calendar, FedEx and Nike Inc (NYSE:NKE, ETR:NKE) are expected to publish their latest results.