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Initial weekly jobless claims rise more than expected
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SVB Financial slumps on 2023 forecast cut
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General Electric rises after reiterating forecast
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Indexes up: Dow 0.44%, S&P 0.42%, Nasdaq 0.42%
(Updates to market open)
By Amruta Khandekar and Shristi Achar A
March 9 (Reuters) - Wall Street's main indexes rose on
Thursday after a jump in weekly jobless claims eased some
concerns about sharper rate hikes as investors geared up for a
key jobs report that could determine the Fed's future monetary
policy path.
The jobless claims report comes on the heels of a string of
recent data that had indicated a tight labor market which, along
with hawkish remarks by Federal Reserve Chair Jerome Powell, had
exacerbated concerns that the central bank could shift to more
aggressive rate hikes.
Traders reduced bets of a 50-basis-point rate hike at the
Fed's next meeting after the report, with the terminal rate now
seen at 5.63% in September compared with 5.67% prior to the
report. .
They had dramatically increased their bets for a large 50
basis point rate increase by the Fed in March from a 25 bps
hike, after Powell's testimony.
Powell, on the second day of his testimony on Wednesday, reaffirmed his message of likely sharper interest rate hikes, but emphasized that the decision hinged on economic data before the central bank's March meeting.
Initial claims for state unemployment benefits rose 21,000 to a seasonally adjusted 211,000 for the week ended March 4, the Labor Department said on Thursday. Economists polled by Reuters had forecast 195,000 claims for the latest week. "This could be a game changer for today's market," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. "It's certainly good news in terms of higher interest rate expectations. If this trend continues, the Fed might not have to be that aggressive."
As U.S. Treasury yields eased following the data, shares of Big Tech and growth companies such as Amazon.com Inc , Apple Inc , Microsoft , Alphabet Inc rose between 0.8% and 1.3%. The gains pushed up the S&P 500 communication services , consumer discretionary and information technology sectors between 0.4% and 0.6%. Energy shares were the biggest gainers, up 1.7% as oil prices climbed. .
Investors' focus is now on the February non-farm payrolls
report on Friday, which is expected to show payrolls rose by
205,000 last month, according to economists polled by Reuters,
after January's blowout 517,000 figure, which had first led
markets to reprice their expectations for U.S. interest rates.
At 9:45 a.m. ET, the Dow Jones Industrial Average was
up 143.02 points, or 0.44%, at 32,941.42, the S&P 500 was
up 16.78 points, or 0.42%, at 4,008.79, and the Nasdaq Composite was up 48.42 points, or 0.42%, at 11,624.43.
Weighing on the S&P 500, shares of SVB Financial Group slumped 34.8% as the startup-focused lender slashed its
2023 outlook and announced a $1.75 billion share sale to shore
up its balance sheet.
U.S.-listed shares of JD.com Inc dropped
7.9% after the Chinese e-commerce firm missed fourth-quarter
revenue estimates.
General Electric Co rose 6.9% as the industrial
conglomerate reiterated its 2023 earnings forecast.
Advancing issues outnumbered decliners by a 1.64-to-1 ratio on the NYSE and by a 1.06-to-1 ratio on the Nasdaq. The S&P index recorded four new 52-week highs and 11 new lows, while the Nasdaq recorded 28 new highs and 54 new lows.
(Reporting by Amruta Khandekar, Shristi Achar A and Johann M
Cherian in Bengaluru, additional reporting by Medha Singh
Editing by Vinay Dwivedi)
