Lingering Economic Concerns May Lead To Pullback On Wall Street
09 Agosto 2024 - 10:11AM
IH Market News
The major U.S. index futures are currently pointing to a lower
open on Friday, with stocks likely to give back ground after moving
sharply higher in the previous session.
Traders may look to cash in on yesterday’s rally, which saw the
S&P 500 post its biggest percentage gain since November
2022.
Lingering concerns about the outlook for the U.S. economy may
also weigh on Wall Street even after yesterday’s report showing a
bigger than expected pullback by weekly jobless claims.
Overall trading activity may be somewhat subdued, however, with
a lack of major U.S. economic data likely to keep some traders on
the sidelines.
Traders may also be reluctant to make significant moves ahead of
the release of key economic data next week, including closely
watched readings on inflation as well as reports on retail sales
and industrial production.
Among individual stocks, shares of Expedia (NASDAQ:EXPE) are
moving sharply higher in pre-market trading after the travel
technology company reported better than expected second quarter
results.
Cloud computing company Akamai Technologies (NASDAQ:AKAM) is
also likely to see initial strength after reporting second quarter
results that beat estimates and raising its full-year guidance.
On the other hand, shares of e.l.f. Beauty (NYSE:ELF) are seeing
significant pre-market weakness even though the company reported
better than expected fiscal first quarter results.
Stocks moved sharply higher during trading on Thursday, with the
major averages more than offsetting the downturn seen over the
course of the previous session. The major averages surged early in
the session and saw further upside as the day progressed.
The major averages moved roughly sideways going into the close,
hovering near their best levels of the day. The Nasdaq soared
464.22 points or 2.9 percent to 16,660.02, the Nasdaq spiked 119.81
points or 2.3 percent to 5,319.31 and the Dow jumped 683.04 points
or 1.8 percent to 39,446.49.
The rally on Wall Street came after the Labor Department
released a report showing first-time claims for U.S. unemployment
benefits pulled back by more than expected in the week ended August
3rd.
The report said initial jobless claims fell to 233,000, a
decrease of 17,000 from the previous week’s revised level of to
250,000.
Economists had expected jobless claims to edge down to 240,000
from the 249,000 originally reported for the previous week.
The bigger than expected decline came a week after jobless
claims reached their highest level since hitting 258,000 in the
week ended August 5, 2023.
The data helped ease concerns about the strength of the labor
market, which have contributed to recent selling on Wall
Street.
“Initial jobless claims are taking center stage as economists
and investors seek guidance from real-time indicators on the
economy’s health,” Nationwide Financial Markets Economist Oren
Klachkin.
“To us, the data suggest we’re on track for a cooldown – not a
recession,” he added. “However, risks are tilted to the downside
and the Fed should be vigilant for non-linearities as it maintains
a restrictive policy stance.”
Among individual stocks, athletic apparel company Under Armour
(NYSE:UAA) skyrocketed by 19.2 percent after reporting an
unexpected fiscal third quarter profit.
Eli Lilly (LLY) also moved sharply higher after the drug maker
reported better than expected second quarter results and raised its
full-year revenue guidance.
On the other hand, shares of Warner Bros. Discovery (NASDAQ:WBD)
slumped after the company reported disappointing second quarter
results and announced a $9.1 billion write down tied to its TV
networks.
Networking stocks turned in some of the market’s best
performances on the day, resulting in an 8.4 percent spike by the
NYSE Arca Networking Index.
Substantial strength was also visible among semiconductor
stocks, as reflected by the 6.9 percent surge by the Philadelphia
Semiconductor Index.
Shares of Lattice Semiconductor (NASDAQ:LSCC) soared by 13.3
percent after Raymond James upgraded its rating on the company’s
stock to Outperform from Market Perform.
Pharmaceutical stocks also saw considerable strength on the
upbeat results from Eli Lilly, with the NYSE Arca Pharmaceutical
Index jumping by 3.6 percent. Airline, computer hardware and
biotechnology stocks also moved notably higher, while telecom
stocks were among the few groups that bucked the upward trend.
Warner Brothers Discovery (NASDAQ:WBD)
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Warner Brothers Discovery (NASDAQ:WBD)
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