Stocks climb on Wall Street as tech giants rebound | Economic news
By DAMIAN J. TROISE, AP Business Writer
NEW YORK (AP) — Stocks rose Thursday morning on Wall Street as tech companies clawed back some of the ground they had recently lost.
Major indexes are still heading for weekly losses and dismal monthly performance after sliding for much of April. This week has been particularly eventful as investors scrutinize a big batch of corporate earnings from big tech companies, industrial companies and retailers.
The S&P 500 was up 0.7% at 10:19 a.m. EST. The Dow Jones Industrial Average rose 111 points, or 0.3%, to 33,413 and the Nasdaq rose 0.7%.
Big tech and communications companies have been driving much of the swings in the broader market as their expensive stock values have more strength to drive major indexes up or down.
Apple, which releases its latest financial results later Thursday, rose 2.7%. Chipmaker Qualcomm jumped 5.8% after easily beating Wall Street earnings estimates. Facebook’s parent company Meta jumped 13.3% after beating Wall Street’s first-quarter profit forecast and reporting an encouraging rise in daily user numbers.
Encouraging financial reports helped support the gains of several other large companies. McDonald’s rose 2.1% after a strong earnings update. Southwest Airlines rose 1.7% after reporting strong revenue and telling investors it expects a profitable year as travel demand returns with the pandemic subsiding.
Bond yields gained ground. The 10-year Treasury yield fell from 2.81% to 2.86%.
The latest round of corporate report cards hits the market as Wall Street tries to figure out how rising inflation is affecting businesses and consumer spending.
Supply chain issues have hampered business operations in many industries throughout the pandemic recovery and Russia’s ongoing war on Ukraine has compounded increases in energy prices and major foodstuffs. China’s strict COVID-19 lockdown measures have added to concerns about slowing growth.
The US Federal Reserve is expected to hike rates aggressively as it steps up its fight against inflation. The Fed chairman indicated that the central bank may raise short-term interest rates to double the usual amount in upcoming meetings, starting next week. It has already raised its key overnight rate once, the first such hike since 2018.
The Commerce Department said Thursday that the U.S. economy contracted in the last quarter for the first time since the pandemic recession hit two years ago. But the report showed consumers and businesses continued to spend, despite rising inflation, as a sign of underlying resilience.
Consumer spending is being watched closely as an indicator of the broader economy as everything from food to clothing and gasoline becomes more expensive. Internet retail giant Amazon will release its results later Thursday, giving Wall Street another measure of how retailers and consumers are responding to higher prices. Investors will also get another spending update on Friday when the Commerce Department releases its personal income and spending report for March.
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