Stocks finished mixed Thursday, with the Dow helped by fading Treasury bond yields and firmer corporate earnings, as investors looked to a key interest rate decision in Europe prior to the start of trading and Apple's closely-watched update after the closing bell.
Stocks got a lift from a better-than-expected reading for third quarter GDP, which was estimated to have expanded 2.6%, with investors focused on a big decline in the prices component and data showing inflationary pressures for the quarter abated from levels seen earlier in the year.
The data followed a move by the European Central Bank to raise its key refinancing rate by 75 basis points, taking it to 2%, as officials grapple with double-digit inflation pressures and a burgeoning energy crisis in the world's largest economic bloc.
Projections for its next move, however, are mixed, after a surprisingly smaller-than-expected 50 basis point increase from the Bank of Canada yesterday that suggests policy officials around the world are starting to asses the impact of their inflation fight on growth and employment prospects.
That has traders betting on smaller hikes from the Federal Reserve, as well, and although a 75 basis point move is locked-in for November, bets on a follow-on move of the same size in December have eased some 35 basis points from last week to around 42.5%.
Benchmark 10-year notes yields slumped to 3.954% while the U.S. dollar index, which tracks the greenback against a basket of six global currencies, rose 0.24% to 109.956, but remains trading near the lowest levels in three weeks.
The boost from falling yields and a weaker dollar that would normally provide to stocks has been evident, with the S&P 500 rising for two of the past three sessions, but a series of weaker-than-expected tech earnings -- particularly Google (GOOGL) and Microsoft (MSFT) -- has kept broader gains in check.
That put a great deal of focus on tonight's after-the-bell updates from Apple and Amazon (AMZN), with investors keying on the former's holiday quarter sales outlook and the latter's indication of any weakness in its benchmark Web Services division.
That said, better-than-expected third-quarter updates from Dow components Honeywell (HON), Caterpillar (CAT), Merck (MRK) and McDonald's (MCD) are giving a solid boost to the start of trading.
On Wall Street, the S&P 500 finished down 0.61%, while the Dow Jones Industrial Average, on pace for its best monthly gain since 1997, gained 194 points, or 0.61%, to 32,033. The tech-focused Nasdaq dropped 1.63% on the back of a massive pre-market decline for Meta Platforms.
Meta Platforms shares, in fact ended off 25%, wiping billions from the social media group's value, following a dismal third quarter earnings update that forecast deeper losses ahead for its struggling metaverse project.
Ford (F) shares gained 1.6%, following an earlier slip, after the carmaker narrowed its full-year profit guidance and booked a $2.7 billion charge linked to the wind-down of its self-driving business.
Twitter (TWTR) gained nearly 1% as officials at the New York Stock Exchange prepared to suspend the shares from trading tomorrow ahead of the Delaware court's deadline for Elon Musk to complete his $44 billion takeover of the social media group.
In overseas markets, the region-wide Stoxx 600 was down 0.7% in mid-day Frankfurt trading ahead of the ECB rate decision at 8:15 am Eastern time, while the FTSE 100 gained 0.08% in London.
Overnight in Asia, stocks rebounded from their lowest levels in more than two years with the region-wide MSCI ex-Japan index marked 0.8% higher heading into the close of trading. Japan's Nikkei 225 fell 0.32%.
