(Bloomberg) — The world’s biggest technology companies sparked a stock market rebound ahead of Apple Inc.’s earnings, with Wall Street traders also gearing up for Friday’s key jobs report.
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Stocks halted two-day decline, Nvidia Corp. leading chipmaker gains with Apple up nearly 2%. Wall Street expects the iPhone maker to announce a buyout, following the lead of fellow big tech companies Alphabet Inc. and Meta Platforms Inc. Any news related to artificial intelligence features could spark additional enthusiasm for a stock which has fallen more than 10% this year.
Ahead of the monthly jobs report, data showed that U.S. labor costs rose the most in a year as productivity gains slowed, heightening risks that the inflation remains high. Economists surveyed by Bloomberg forecast an increase of 240,000 nonfarm jobs, which would be the slowest pace since November.
The Fed decided Wednesday to leave the target range for its benchmark rate between 5.25% and 5.5% following a series of data showing continued price pressures. Jerome Powell said it was unlikely the Fed’s next move would be a rate increase.
“Even though the Fed appears to have all but ruled out a rate hike, it has also made clear that it is willing to keep rates high for longer,” said Chris Larkin at Morgan Stanley’s E*Trade. “Markets will be hungry for data that suggests the economy is not warming any more than in the first quarter.”
The S&P 500 was hovering near 5,040. Qualcomm Inc., the world’s largest seller of smartphone processors, surged on optimistic forecasts. EBay Inc. collapsed amid disappointing prospects. 10-year Treasury yields fell three basis points to 4.60%. The dollar has fallen.
A survey by 22V Research shows that 30% of investors surveyed believe Friday’s jobs report will be “risk-oriented”, 27% expect a “risk-averse” reaction and 43% have answered “mixed/negligible”. Among labor indicators, the tally shows that investors will pay the most attention – by far – to average hourly wages.
The options market is betting that stocks will see big swings after Friday’s U.S. jobs report, which traders say will provide more clarity on how much the Federal Reserve could cut interest rates. interest this year.
The S&P 500 Index is expected to move 1.2% in either direction after the release, based on the cost of at-the-money put and call options expiring Friday, according to Stuart Kaiser, head of trading strategy at US stocks at Citigroup Inc.
That figure, based on S&P stock prices as of Wednesday’s close, is the largest implied change ahead of a jobs report since March 2023, he said.
Bank of America Corp.’s Savita Subramanian says a robust economy will support the U.S. stock market’s rise, even without the Fed’s interest rate cut.
“I think we’re heading towards a soft landing, with a reasonable market environment, maybe better growth than we’re used to, higher rates and a little bit higher inflation,” Subramanian said Thursday on Bloomberg Television.
Company strengths:
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Peloton Interactive Inc. said CEO Barry McCarthy is stepping down as the company undergoes a major restructuring that will reduce its global workforce by 15% in a bid to cut costs.
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MGM Resorts International reported first-quarter sales and profit that beat analysts’ forecasts, benefiting from Macau’s post-pandemic recovery and a new partnership with Marriott International Inc. that helped fill hotel rooms.
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Carvana Co. reported stronger earnings with revenue above expectations as the company deepens its restructuring plan and regains sales momentum.
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DoorDash Inc., the largest food delivery service in the United States, reported disappointing profit guidance for the current quarter as the company invests in expanding its list of non-restaurant partners and in improving its efficiency.
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Moderna Inc. reported a first-quarter loss that was smaller than Wall Street had expected, as the biotech giant’s cost cutting helped offset a sharp decline in its Covid business.
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Apollo Global Management Inc. reported higher first-quarter profit as the company raked in more management fees and extended a record $40 billion in private credit, a key area of growth.
Key events this week:
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Unemployment in the euro zone, Friday
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US unemployment, non-farm payrolls, ISM services, Friday
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Chicago Fed President Austan Goolsbee speaks Friday
Some of the main market movements:
Actions
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The S&P 500 rose 0.4% as of 1 p.m. New York time
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The Nasdaq 100 rose 0.6%
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The Dow Jones Industrial Average rose 0.4%
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The MSCI World index increased by 0.6%
Currencies
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The Bloomberg Dollar Spot Index fell 0.6%
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The euro was little changed at $1.0717
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Sterling little changed at $1.2516
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The Japanese yen rose 0.5% to 153.79 per dollar
Cryptocurrencies
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Bitcoin rose 3% to $59,034.09
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Ether rose 1.5% to $2,981.5
Obligations
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The 10-year Treasury yield fell three basis points to 4.59%
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The German 10-year yield fell four basis points to 2.54%
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The UK 10-year yield fell eight basis points to 4.29%
Raw materials
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West Texas Intermediate crude was little changed
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Spot gold fell 0.9% to $2,299.69 an ounce
This story was produced with the help of Bloomberg Automation.
–With help from Ryan Vlastelica and Jessica Menton.
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