Stock Market Today: S&P eyes 5,000 on earnings lift; 30-year auction on deck

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U.S. equity futures slipped lower Thursday, following on from a session where the S&P 500 came tantalizingly close to the 5,000-point mark, as investors continue to ride the wave of a strong earnings season while repricing bets on Federal Reserve interest rate cuts.

The S&P 500, the broadest measure of blue-chip U.S. shares, closed nearly 41 points higher last night to extend its year-to-date gain to around 3.9%, powered once again by outsized advances in the tech sector.

The benchmark also came within 0.11 point of the 5,000 mark, breaching a level that would come more than 1,000 days after it hit the 4,000 barrier in April of 2021. 

Stocks are finding support from a stronger-than-expected fourth-quarter-earnings season, a resilient domestic economy and a Fed that, while not ready to cut rates in the spring, has nonetheless reached the end of its rate-hiking cycle.

Adding to upward support for stocks this week has been solid demand for the Treasury’s two benchmark auctions, which has kept bond yields in check despite concerns linked to the health of the regional banking system.

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A sterner test may come today, however, with the sale of $25 billion in new 30-year bonds later in the session. The sale will gauge demand for longer-term debt amid a surge in new supply from both government and corporate borrowers.

Benchmark 10-year notes were last marked 2 basis points lower in overnight trading at 4.115% while 2-year notes were little changed at 4.425%.

The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.16% higher at 104.226, thanks in part to a weaker yen tied to dovish comments from a Bank of Japan official.

On Wall Street, investors are likely to focus on initial jobless claims data at 8:30 a.m. Eastern time, as well as the latest update to the Atlanta Fed’s GDPNow forecasting tool later in the session, and the results of the 30-year auction, expected at around 1 p.m. Eastern.

Big premarket movers include Disney  (DIS) , which was marked 5.8% higher at $104.87 after posting stronger-than-expected fiscal-first-quarter earnings and boosting its regular dividend.

Chipmaker Arm Holdings, which listed on the Nasdaq last year, soared more than 24% after it touted a surge in AI demand in its robust near-term outlook while  PayPal  (PYPL)  slumped 9.3% after the payments group cautioned for a “transition year” in terms of profitability. 

Futures contracts tied to the S&P 500 suggest an 8 point opening bell dip while those linked to the Dow Jones Industrial Average are priced for a 9 point bump. The Nasdaq is called 18 points lower. 

Overnight in Asia, China stocks recorded their best week in more than a year ahead of the long Lunar New Year break. But data showing the biggest fall in inflation in more than 14 years rattled confidence in the recovery prospects of the world’s second-largest economy.

In Japan, a weaker yen and a surge in tech stocks, including Arm owner Softbank, lifted the Nikkei 2.06% to a 34-year high of 36,863.28 points.

In Europe, the regionwide Stoxx 600 was marked 0.05% lower in early Frankfurt trading, amid the busiest earnings day of the year so far, while Britain’s FTSE 100 slipped 0.1% in London.

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