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U.S. equity indexes rise, Nasdaq leads gains with chips
rallying
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Tech leads S&P 500 sector gainers; comm svcs weakest group
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Euro STOXX 600 index up ~0.4%
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Dollar ~flat, gold edges red, crude gains, bitcoin off
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U.S. 10-Year Treasury yield edges down to ~3.91%
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WALL STREET EQUITIES KICK OFF THE DAY WITH GAINS (1020
EST/1520 GMT)
Wall Street's three major indexes are advancing on Thursday
with the technology-heavy Nasdaq leading the charge with a
particular boost from semiconductors.
Equities had lost ground on Wednesday after the release of Federal Reserve meeting minutes.
The Philadelphia semiconductor index is up more than 2% with its biggest gains coming from Nvidia whose quarterly report late on Wednesday also put the rest of the sector in a good mood.
Nvidia's Q1 revenue forecast beat consensus as its CEO said use of its chips for artificial intelligence (AI) services like chatbots went "through the roof in the last 60 days." Still investors are watching economic data closely with their focus still on the Federal Reserve's rate hiking cycle.
The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, continuing to signal persistently tight labor market conditions. Also, a separate Commerce Department report confirmed the economy grew solidly in the fourth quarter, though much of the increase in output came from unsold goods at businesses. Only communication services and consumer discretionary are lower on Thursday. Technology is up more than 1% along with energy , which is being helped by rising oil prices.
Here is a market snapshot from just after 1015 EST:
(Sinéad Carew)
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S&P 500 ENERGY SECTOR STILL WELL-CAPPED BY RECORD HIGHS (0900 EST/1400 GMT) The S&P 500 energy sector has been the market's go to group. SPNY rocketed 59% in 2022, for its biggest yearly percentage rise ever. In fact, it was the only S&P 500 sector to post a gain in 2022, in a year that the benchmark index ended down nearly 20%. That said, energy failed to surpass its 2014 record high, and waning monthly momentum suggests caution: SPNY hit a high of 724.74 in November of last year, putting it within 2% of its 738.71 record-high recorded in June 2014. However, the monthly RSI failed to confirm the sector's rise late last year. A similar pattern of divergence developed into the group's 2008 top. Since its November peak, the sector has gyrated wildly, and now stands down 12% from that high. Year-to-date, the energy sector is off just over 5% vs an SPX rise of about 4%. SPNY is on track to end February above its rising 12-month moving average (MMA) for a 27th-straight month. If so, it will exceed the 26-month run into its 2014 high. The sector ended above its 12-MMA for 62-straight months into its 2008 top. In any event, with the 12-MMA now around 625, or less than 2% below Wednesday's 637.29 close, the group may need to quickly heat up again. Traders will be watching for a monthly close below the 12-MMA as it may confirm a significant break in SPNY's longer-term advance. Meanwhile, NYMEX crude futures have been on the back foot. The futures now around $75.00 are down more than 40% from their $130.50 March 2022 high, and a chart magnet still beckons for lower levels.
(Terence Gabriel)
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(Terence Gabriel is a Reuters market analyst. The views
expressed are his own)
