TSM Taiwan Semiconductor Manufacturing Co Ltd

Stocks saw modest strength for much of the session on Thursday before giving back ground late in the trading day to close roughly flat. The Dow still managed to reach a new record closing high.

The Dow ended the day up 161.35 points or 0.4 percent at 43,239.05, while the Nasdaq crept up 6.53 points or less than a tenth of a percent to 18,373.61 and the S&P 500 edged down 1.00 point or less than a tenth of a percent to 5,841.47.

Strength among semiconductor stocks supported the markets for much of the session before a late-day pullback, although the Philadelphia Semiconductor Index still ended the day up by 1.0 percent.

The strength in the sector came after Taiwan Semiconductor Manufacturing Company (NYSE:TSM) reported a sharp increase in third quarter profits.

The strong results from TSMC offset concerns about the outlook for semiconductor demand following a warning from Dutch chipmaker ASML (NADAQ:ASML) earlier in the week.

“The fate of the global stock market hinged on TSMC’s results and fortunately everything is fine in AI land,” says Dan Coatsworth, investment analyst at AJ Bell.

Positive sentiment was also generated in reaction to a batch of largely upbeat U.S. economic data, including a Commerce Department report showing retail sales increased by slightly more than expected in the month of September.

The Commerce Department said retail sales rose by 0.4 percent in September after edging up by 0.1 percent in August. Economists had expected retail sales to rise by 0.3 percent.

Excluding sales by motor vehicle and parts dealers, retail sales climbed by 0.5 percent in September after rising by 0.2 percent in August. Ex-auto sales were expected to inch up by 0.1 percent.

A separate report released by the Labor Department showed an unexpected pullback by first-time claims for U.S. unemployment benefits in the week ended October 12th.

The report said initial jobless claims fell to 241,000, a decrease of 19,000 from the previous week’s revised level of 260,000.

Economists had expected jobless claims to inch up to 260,000 from the 258,000 originally reported for the previous week.

With the unexpected pullback, jobless claims gave back ground after reaching their highest level since hitting 261,000 in the week ended June 17, 2023.

Meanwhile, the Federal Reserve released a report showing industrial production in the U.S. fell by slightly more than expected in the month of September.

The Fed said industrial production decreased by 0.3 percent in September after rising by a downwardly revised 0.3 percent in August.

Economists had expected industrial production to dip by 0.2 percent compared to the 0.8 percent increase originally reported for the previous month.

The slightly bigger than expected decline by industrial production partly reflected a strike at Boeing (NYSE:BA) and the effects of Hurricanes Helene and Milton.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan’s Nikkei 225 Index slid by 0.7 percent, while China’s Shanghai Composite Index slumped by 1.1 percent.

Meanwhile, the major European markets have moved to the upside after the ECB lowered interest rates. While the French CAC 40 Index jumped by 1.2 percent, the German DAX Index advanced by 0.8 percent and the U.K.’s FTSE 100 Index climbed by 0.7 percent.

In the bond market, treasuries gave back ground after trending higher over the past few sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 7.7 basis points at 4.093 percent.

Reaction to the latest earnings news may impact trading on Friday, with streaming giant Netflix (NASDAQ:NFLX) among the companies due to report their quarterly results after the close of today’s trading.

SOURCE: RTTNEWS

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