Stocks pulled back on Thursday, as investors processed a wave of quarterly earnings results, with major tech stocks taking a step back from their strong gains earlier in the week.
The Dow Jones Industrial Average and S&P 500 both ended the day down by 0.2%, while the Nasdaq Composite fell 0.9%. The declines came after a strong performance the day before, which saw the major indices notch their best one-day performance in over two months. The rally on Wednesday was fueled by better-than-expected inflation data, which stoked hopes that the Federal Reserve could continue cutting interest rates, as well as strong earnings from several large banks.
Banking stocks remained in focus on Thursday. Morgan Stanley (MS) saw its shares surge 4% to an all-time high after surpassing earnings expectations. In contrast, Bank of America (BAC) saw its stock drop 1%, despite beating earnings estimates. U.S. Bancorp (USB) and PNC Financial Services Group (PNC) saw sharper declines, falling 5.6% and 2%, respectively, following their earnings reports.
Mega-cap technology stocks, which had led Wednesday’s rally, were lower across the board. Apple (AAPL) dropped 4%, while Tesla (TSLA) fell 3.4%. Other major tech companies, including Nvidia (NVDA), Microsoft (MSFT), Alphabet (GOOGL), Amazon (AMZN), and Meta Platforms (META), also posted losses.
UnitedHealth Group (UNH) was one of the biggest decliners, with shares plummeting 6% after disappointing earnings results, leading both the S&P 500 and Dow lower.
In contrast, chip stocks showed strength, driven by Taiwan Semiconductor Manufacturing Co. (TSM), the world’s largest contract chip manufacturer, which reported better-than-expected earnings and issued an optimistic outlook for AI demand. Shares of chip equipment makers such as KLA Corp (KLAC), Lam Research (LRCX), and Applied Materials (AMAT) each gained more than 4%, and Taiwan Semiconductor’s U.S.-traded shares rose nearly 4%.
On the economic front, weekly jobless claims and monthly retail sales data largely met expectations. Investors are closely monitoring these indicators for signs of how they might influence the Federal Reserve’s decision-making on future interest rate hikes.
The yield on the 10-year U.S. Treasury bond, which is closely watched for clues on interest rate trends, stood at 4.61%, down slightly from 4.65% the previous day. On Wednesday, the yield posted its largest decline since August following the release of encouraging inflation data.
In the cryptocurrency market, Bitcoin traded at $99,600 in late afternoon, recovering from a low of $97,300 but still below its high of $100,900 earlier in the session. The digital currency had briefly surpassed $100,000 the day before, marking its highest level in over a week.
Gold futures rose by 1.3%, settling at around $2,750 an ounce, while WTI crude oil futures slipped 1.6% following a strong rally the day before.
Related topics:
Why Do Some Stocks Pay Dividends?
Why Is Origin Materials Stock Dropping?
