The stock market shook off a morning slump and was higher midday Thursday after some economic reports that were generally positive. Arm was up sharply after its IPO.
The Dow Jones Industrial Average rose 1%. The S&P 500 and Nasdaq composite added 0.9% as indexes traded at the day's best levels. In an important change, the three indexes went back above their 50-day moving averages.
Dow component Visa fell more than 2%. The company is considering modifying its unconventional stock structure. Visa shares are below the 245.37 buy point of an Aug. 29 breakout.
The small-cap Russell 2000 led with a 1.2% increase. It closed below the 200-day moving average Wednesday but is back above the line Thursday.
Volume fell on the Nasdaq and rose on the NYSE vs. the same time on Wednesday. Advancers led decliners by 5-to-2 on the Nasdaq and by 4-to-1 on the NYSE.
The Innovator IBD 50 ETF lagged with a 0.2% afternoon increase. Patterson-UTI Energy edged above a 15.95 buy point, but volume was meek.
Major stocks were higher. Tesla climbed 1.4% in afternoon dealings. It continued to work on a cup base with a 299.29 buy point. Cathie Wood's ARK Invest resumed selling stock of the EV company, dumping more than 51,000 shares, according to disclosures.
Arm Begins Trading
Chip designer and licenser Arm late Wednesday priced an initial offering of 95.5 million shares at $51 each, at the high end of its expected range of $45-$51. The IPO raised nearly $5 billion for SoftBank, which retains 90% of Arm shares.
Arm started trading at midday at around 60, well above the IPO price. Arm is the largest IPO so far this year and thus a test of the IPO market. Softbank stock was little changed.
Some market watchers considered the valuation too high. Arm is one of the most important companies in the chip sector. Its designs are ubiquitous, used by Apple, Nvidia and many more tech companies.
Stock Market Takes In PPI, Retail Sales
Inflation and retail sales reports came in above forecasts as jobless claims eased. Yet pressures are building on consumers.
The August producer price index climbed 0.7%, above the consensus estimate for a 0.4% increase. Excluding food and energy, wholesale prices rose 0.2%, in line with forecasts.
The Commerce Department said August retail sales climbed 0.6%, well above the consensus estimate of a 0.1% increase. Excluding autos, sales also rose 0.6% and exceeded forecasts. August sales data was little changed from the prior month's revised numbers.
"The latest data support our view that the U.S. economy is headed for a period of moderate growth, avoiding a recession over the coming 12 months," said Solita Marcelli, chief investment officer of the Americas at UBS Global Wealth Management. "That should support equities. However, uncertainty is likely to keep broad equity markets choppy and rangebound."
Jobless claims edged up to 220,000 last week, below forecasts for 225,000.
And the European Central Bank raised interest rates by a quarter point to a record high, saying inflation hasn't been brought under control. The main European indexes rose 1% or more.
At midday, the 10-year Treasury yield was up 4 basis points to 4.29%. Traders still believe the Fed will not change interest rates next week, while odds for a quarter-point hike at the November meeting fell modestly today.
Auto Strike Deadline Nears
Automakers continued talks with labor leaders ahead of a midnight deadline for a strike. United Auto Workers President Shawn Fain told members that automakers drew closer to the union's demands, but he is doubtful that a deal can be reached before time expires. A strike would be a blow to the auto industry and the U.S. economy.
General Motors fell 0.5% and Stellantis lost 1.2% in afternoon trading, while Ford was off 0.8%.
HP Inc. gapped down 2.2% to its lowest point since March, although it was off the day's lows. The company disclosed that Warren Buffett's Berkshire Hathaway sold about 5.5 million shares this week, leaving Berkshire with 115.5 million HP shares.
HP stock has been trending downward since a high of 33.90 on July 12. A breakout at 31.71 has failed. Berkshire shares rose 0.6%, on track for a record closing high.
Cintas climbed above the 518.71 buy point of a flat base, but volume was weak. The relative strength line for the uniform maker is near the best levels of the year.
