The stock market deteriorated in the past hour and showed mixed results, with the Dow Jones starting to give up its winning streak in afternoon trading Thursday. Investors enjoyed robust economic data, while contemplating Wednesday's rate hike, which was expected.
The Commerce Department released its first reading on second-quarter GDP. The 2.4% annualized growth easily exceeded the 1.5% economists expected, and outpaced 2% in the first quarter.
Consumer spending came in at 1.6% vs. the 1.5% consensus, and was down considerably from the hardy 4.2% increase in Q1. The report may provide clues to Friday's June PCE price index, the Fed's favorite inflation gauge.
The June durable goods report showed a 4.7% month-over-month rise in new orders vs. the modest 0.5% projected, and higher than the 2.0% revised May tally. The number excluding transportation increased 0.6%, compared with the expected 0.1% drop. Core capital goods orders climbed 0.2% vs. forecasts for a 0.1% decline.
Initial weekly jobless claims for the week ended July 2 fell 7,000 to 221,00 vs. forecasts for a rise to 235,000.
Fed policymakers on Wednesday raised their main interest rate by a quarter-point to a 5.25%-5.5% target range, as expected, followed a pause at the June meeting.
Fed chief Jerome Powell, speaking shortly after the rate increase, said that it's "certainly possible" that the central bank could hike or pause in September and cautioned that "inflation remains elevated."
The 10-year Treasury yield added 13 basis points to 3.98% Thursday morning. Around 8:15 a.m. ET, the European Central Bank raised its key rate by a quarter-point to 3.75%, also as expected, following the Fed's hike.
Stock Market Action; Dow On A Roll
The Dow Jones index extended its win streak to 13 sessions on Wednesday, the longest win streak since 1987. If it closes up today, it would be the longest winning streak since the 14-day rally ending June 14, 1897 — yes, that's 1897.
The Nasdaq composite eased from earlier gains and rose 0.6% in Thursday afternoon stock market action, getting a lift from META stock. The Dow Jones Industrial Average gave back earlier gains, now dipping 0.1%, and the S&P 500 rose 0.2%. Meanwhile, the small-cap Russell 2000 trimmed 0.1%.
Nasdaq 100-tracking Invesco QQQ Trust ETF added 1%. The Innovator IBD 50 ETF outperformed the major indexes, rising 0.8%.
NYSE volume and Nasdaq volume rose vs. the same time on Wednesday.
Stock Movers: Driver-Assist Tech Stock Sells Off
Mobileye Global sank 6%, despite the maker of driver-assistance systems and self-driving cars technology having beat analyst Q2 estimates. It also raised its earnings outlook for the full year.
Earnings dropped 7% from last year's same quarter, and sales growth slowed to 16% from 59% and 38% in the prior two quarters. The stock sank further below its 50-day moving average.
MBLY stock began trading last October with its initial public offering priced at $21 a share. The company was a spinoff from Intel.
Royal Caribbean stock gapped up over 8% in heavy volume after the cruise line company posted higher-than-expected Q2 profit and sales, and gave third quarter EPS guidance higher than analysts' projections. The IBD 50 stock has gained over 120% this year so far, as travel stocks reap the rewards of vacationers hitting the skies, roads and seas.
Peer cruise line and IBD 50 stock Carnival popped nearly 5% and Norwegian Cruise Line surged 5% in sympathy with Royal Caribbean stock.
IBD leaderboard stock Meta Platforms gapped up over 5% in heavy volume after it reported better-than-expected second-quarter earnings and sales, and gave guidance above analysts' projections. Shares hit a 52-week high on Thursday.
Chipotle Mexican Grill gapped down over 8% in heavy trading, after reporting lower-than-expected second-quarter sales and a beat on earnings. The stock fell below its 50-day line, flashing a sell signal.
The Mexican restaurant chain gave slightly lower same-store sales guidance, below analysts consensus forecast, and sees food costs rising in the third quarter. CMG is on track for its largest percent decrease since March 18, 2020, when it fell 11.3%.
IPO stock Nextracker gapped up over 14% in huge volume after posting a beat on its fiscal first-quarter profit and sales. The solar tracking company posted 167% EPS growth on 19% sales growth. Analysts project fiscal 2024 earnings growth of 38% and 29% in 2025.
Dow Win Streak Ends On Market Reversal; These Stocks Shine Late
Stock Market Action: Dental Device Stock Soars
Lam Research popped over 10% after the chip equipment company posted higher-than-expected earnings and revenue.
Align Technology stock jumped over 15% in heavy price action, after the teeth-straightening device company exceeded second-quarter earnings and sales projections. ALGN is the S&P 500 biggest gainer today.
Edwards Lifesciences tumbled over 8% in heavy volume, even through the medical device company beat Q2 sales and EPS expectations. The stock fell below its 50-day line, flashing a sell signal.
Follow Kimberley Koenig for more stock market news on Twitter @IBD_KKoenig.
