Major indexes closed near session highs Thursday. Investors awaited quarterly earning reports from three Magnificent Seven companies after market close. The Dow Jones Industrial Average added 370 points for a 1% gain at the closing bell.
The S&P 500 gained momentum in the afternoon and climbed 1.3% on the stock market today. And the Nasdaq rebounded 1.3%, making up much of Wednesday's 2.2% loss. The Nasdaq found support at its 21-day exponential moving average.
The yield on the benchmark 10-year Treasury note fell 10 basis points to 3.86%, which appeared to boost the major indexes.
Initial jobless claims came in higher than expected, at 224,000 for the week ended Jan. 27. Economists expected claims to come in at 214,000, according to Econoday. The previous week's figures were upwardly revised to 215,000.
Meanwhile, the S&P Global final manufacturing Purchasing Managers' Index for January came in at 50.7, above flash estimates of 50.3. Further, the Institute for Supply Management's manufacturing index rose to 49.1 in January, even though economists expected it to stay unchanged at 47.4. A reading below 50, however, shows contraction.
Small caps outmatched the action in tech stocks. The Russell 2000 showed a 1.4% gain Thursday. The Innovator IBD 50 exchange traded fund shone, rising 2.5%.
Volume on the New York Stock Exchange was higher but was lower on the Nasdaq compared with the same time on Wednesday.
Dow Jones Stocks
Among Dow Jones components, Apple formed a cup with handle with a buy point of 196.38 ahead of earnings today. The stock fell about 2% in after-hours trading following the quarterly report. Apple saw 2% growth in sales to $119.6 billion. Earnings of $2.18 per share rose 16% from the prior year's $1.88 per share.
Merck added to early gains and closed nearly 5% higher in above-average volume. The stock is above a buy zone from a cup base with an entry at 119.65. The pharmaceutical leader Thursday beat sales views and also saw earnings of 3 cents per share versus expectations for an 11-cent loss.
Merck was the biggest gainer in the Dow.
Caterpillar rose over 2%. It's at the top of a buy zone from a 293.88 buy point. The construction-gear maker is due to report earnings Monday.
Stocks Moving Today
In building and construction products, Trex broke out of a flat base with a buy point of 84.67. Volume was more than double its average, a good sign.
Ferrari broke out of a flat base with a buy point of 372.42 after a strong fourth quarter. Also, reports said star race car driver Lewis Hamilton plans to move to Ferrari from Mercedes. The stock is at the top of a buy zone to 391.04.
Among the Magnificent Seven, Amazon.com and Meta Platforms rose sharply in extended trading as both reported earnings after the closing bell.
Amazon surged after Q4 sales rose 14% to $170 billion with earnings per share of $1 versus 3 cents in the prior-year quarter.
Meta's fourth-quarter sales rose 25% to $40 billion, while earnings of $5.33 per share surged 203%. Meta also announced its first dividend, of 50 cents per share. The stock jumped 14% in late trading.
Meanwhile, Cathie Wood's Ark Invest bought more shares of Tesla. According to the company's disclosures, the iconic investor has been loading up on Tesla in the Ark Innovation ETF and the Ark Next Generation Internet ETF. Shares of TSLA rose nearly 1% but are in a downtrend after gapping down on earnings Jan. 25.
Outside the Dow Jones index, Royal Caribbean was an earnings mover and gave up its gains to fall 0.4%. The company beat estimates and guided higher for 2024 earnings. Shares are holding the 10-week moving average.
Meanwhile, new issue Nextracker beat views and raised its outlook for the fiscal year ending in March, and shares soared nearly 25%. The stock shot past an entry of 46.55 and is now extended well above its buy zone.
Conversely, Qualcomm tumbled 5%. The chipmaker beat profit estimates but its sales outlook for the current quarter was in line with expectations. QCOM stock is back at the 10-week moving average, which has been a line of support since November.
Etsy gapped up in early action but gave back some gains. The stock closed below the 50-day line, up 9% in heavy trading. The company announced it has appointed Marc Steinberg, partner at Elliott Investment Management, to its board.
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