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Financial Markets 05/09 15:33
NEW YORK (AP) -- U.S. stocks rose Thursday to pull the S&P 500 back within
1% of its record following a rough April.
The S&P 500 rose 26.41 points, or 0.5%, to 5,214.08. The Dow Jones
Industrial Average gained 331.37, or 0.8%, to 39,387.76, and the Nasdaq
composite added 43.51, or 0.3%, to 16,346.26.
A report showing a pickup in layoffs helped to support the market. The
number of workers applying for unemployment benefits rose by more last week
than economists expected, though it remains relatively low compared with
history.
That could be a sign the economy can pull off a hoped-for balancing act of
staying solid enough to avoid a bad recession, but not so strong that it puts
upward pressure on inflation. Treasury yields erased earlier gains immediately
after the report's release, an indication of expectations for the Federal
Reserve to deliver long-sought cuts to interest rates later this year.
Elsewhere on Wall Street, some stocks swung sharply following their latest
earnings reports.
Equinix jumped 11.5% after reporting stronger profit for the latest quarter
than analysts expected. The company, which runs data centers around the world,
also said an independent investigation led by its board found no accounting
inconsistencies or errors that would require financial restatements. Earlier,
an investment firm had accused it of "major accounting manipulation."
Yeti Holdings rose 12.8% after reporting better profit for the latest
quarter than expected thanks to stronger sales for its drinkware and coolers
and equipment. It also raised its forecast for full-year earnings per share.
Like other companies, it's plowing cash into buying back its own stock, which
boosts per-share profit for existing investors.
Cheesecake Factory gained 6.2% after topping expectations for profit. The
results were encouraging following some recent warnings by big food and drink
companies about how much pressure their customers, particularly lower-income
ones, are feeling.
Airbnb sank 6.9% despite topping expectations for profit and revenue. It
gave a forecasted range for revenue in the current quarter whose midpoint fell
short of analysts'. It said an earlier Easter pulled more of its business this
year into the first quarter from the second quarter.
Beyond Meat, the maker of plant-based meat substitutes, fell 14.4% after it
posted a much worse loss than analysts expected as demand continued to crater.
In the bond market, the yield on the 10-year Treasury eased to 4.45% from
4.50% late Wednesday. The two-year yield, which more closely tracks
expectations for the Fed, slipped to 4.81% from 4.84% late Wednesday.
A smooth auction of 30-year Treasury bonds helped to keep yields stable.
Treasury yields have largely been easing since Federal Reserve Chair Jerome
Powell said last week that the central bank remains closer to cutting its main
interest rate than hiking it, despite a string of stubbornly high readings on
inflation this year. A cooler-than-expected jobs report on Friday, meanwhile,
suggested the U.S. economy could manage to avoid being either too hot or too
cold.
It could take a while for inflation in the United States to cool all the way
back to the Federal Reserve's target, even with the Fed's main interest rate at
its highest level in more than two decades. Economists at S&P Global Market
Intelligence slightly downgraded their forecasts for U.S. economic growth in
2025 and 2026, which they said could allow inflation to settle at the Fed's
target on a sustained basis by 2027.
In stock markets abroad, indexes rose in London and other markets in Europe
after the Bank of England hinted it may soon cut its key interest rate from a
16-year high.
In Asia, indexes were mixed. They climbed 1.2% in Hong Kong and 0.8% in
Shanghai after China reported its exports rose 1.5% in April from a year
earlier, while imports jumped 8.4%. The renewed growth suggests a stronger
recovery in demand than earlier data had suggested.
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AP Writers Matt Ott and Zimo Zhong contributed.
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