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Microsoft up on investment in AI
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DuPont climbs on strong Q4 profit
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Boeing up on announcement of layoffs
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Dow up 0.19%, S&P 500 up 0.58%, Nasdaq up 0.89%
(Adds analyst comments, updates prices, adds market details)
By Carolina Mandl and Johann M Cherian
Feb 7 (Reuters) - U.S. stocks gained in choppy trading
on Tuesday as investors digested comments from Federal Reserve
Chair Jerome Powell about how long the fight to tame inflation
may take.
His comments came after a strong jobs report last week
stymied rising hopes of less aggressive monetary policy. "We
didn't expect it to be this strong," Powell said at the Economic
Club of Washington, referring to last Friday's nonfarm payrolls
report for January, but it "shows why we think this will be a
process that takes quite a bit of time."
"Powell expects they’re not going to be cutting rates
anytime soon, but that there is a good path, that they’re
accomplishing what they need to accomplish,” said Shawn Cruz,
head trading strategist at TD Ameritrade.
The Nasdaq and the S&P 500 fluctuated during and after
Powell's remarks.
The Fed raised interest rates by 25 basis points last week, with markets now pricing in a peak rate above 5% after data on Friday showed the U.S. economy added jobs at a rapid pace in January.
Boosting the tech-heavy Nasdaq and the S&P 500 was Microsoft Corp . The company's shares added 3.38% as the company unveiled an integration of ChatGPT, a chatbot from OpenAI, into its products.
U.S.-listed shares of Baidu Inc soared 11.43% as the Chinese search engine said it would conclude the testing of its ChatGPT-style project "Ernie Bot" in March. Six of the top 11 sectors on the S&P 500 fell, but technology was among top gainers, up 1.61%. Among top gainers on the Dow Jones Industrial Average , Boeing Inc climbed 2.82% after the U.S. planemaker confirmed it expects to cut about 2,000 white-collar jobs.
Views that rates would stay higher for longer dragged U.S. stock indexes down on Monday. But all three major averages are in the black for 2023, with the Nasdaq adding over 13%, led by a revival in battered mega-cap growth stocks. So far, more than half of the companies on the S&P 500 have reported quarterly earnings, with 69.1% of them beating expectations, according to Refinitiv. Still, analysts expect fourth-quarter earnings to decline 3.1%. At 2:24 p.m. EST (1924 GMT), the Dow Jones Industrial Average rose 63.77 points, or 0.19%, to 33,954.79, the S&P 500 gained 23.72 points, or 0.58%, to 4,134.8 and the Nasdaq Composite added 105.46 points, or 0.89%, to 11,992.91. DuPont De Nemours Inc jumped 6.88% on a higher-than-expected quarterly profit supported by higher pricing for its products. Bed Bath & Beyond plunged 45.73% as the home-goods retailer seeks a $1 billion raise in a last-ditch effort to avoid bankruptcy. Later on Tuesday, U.S. President Joe Biden will deliver the annual State of the Union address to a joint session of Congress. (Reporting by Carolina Mandl in New York, Johann M Cherian and Shubham Batra in Bengaluru Editing by Anil D'Silva and Matthew Lewis)
