The Nasdaq rose on Thursday while other indexes were flat to slightly higher, as a dip in Treasury yields after a string of economic data boosted megacap stocks.
Data showed new orders for key U.S.-manufactured capital goods unexpectedly fell in May, while core durable goods orders fell 0.1% versus forecasts for a 0.2% rise, boosting hopes that a weaker economy could prompt the Federal Reserve to cut interest rates in September.
Weekly jobless claims fell to 233,000, missing expectations of 236,000. Further, a final print showed the U.S. economic growth increased more than estimated in the first quarter.
Megacap stocks firmed as Treasury yields slipped after the data, with Amazon.com rising 0.9% after hitting $2 trillion in market value for the first time on Wednesday.
Consumer services led gains with a 0.8% rise, led by gains in Meta Platforms and Netflix, while financial stocks were the biggest drag on the Dow, and the biggest S&P 500 sectoral decliner.
Meanwhile, Micron slipped 5% after an in-line fourth-quarter revenue forecast disappointed investors hoping for more upside from the memory chipmaker’s performance in the artificial intelligence boom.
With a handful of expensive heavily weighted stocks supporting Wall Street’s ascent since the last leg of 2023, market participants have highlighted concerns over the rally’s sustainability and have called out for the need to diversify portfolios to hedge against possible sharp losses.
Nasdaq gains as chip stocks recover ground
“It’s really a question of whether corporate earnings in the tech sector can remain resilient. If they can’t, then we will see probably intermittent profit-taking and small corrections,” said Mike Gallagher, director of research at Continuum Economics.
“It’s going to be a bit difficult for the tech sector to drive on the market the way that it’s done.”
Walgreens Boots Alliance slumped 23.8% after cutting its 2024 profit forecast and announcing plans to close moreunderperforming U.S. stores.
Nvidia fell 1.7% in another day of choppy trading for the AI-trade favorite.
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