Stocks finished higher Thursday, with the S&P 500 notching up another fresh record, as investors reacted to reports of new financial support for China's flagging economy and tech stocks surged following Micron Technology's blowout quarterly earnings.
The Dow Jones Industrial Average climbed 260.36 points, or 0.62%, to end the session 42,175.11, while the S&P 500 rose 0.40% to a fresh record high close of 5,745.37 and the tech-heavy Nasdaq gained 0.60% to finish the day at 18,190.29.
"There has been no shortage of headlines coming out of China this week," said Adam Turnquist, chief technical strategist for LPL Financial. "The People’s Bank of China (PBOC) unleashed an array of monetary stimulus measures to revive their sputtering economy."
"In addition to cutting short- and intermediate-term lending rates, policymakers reduced capital reserve requirements for banks, reduced downpayment requirements for homebuyers, boosted support for local governments buying unsold homes, and introduced liquidity support for equities," he added.
Turnquist said that reports circulated overnight of President Xi’s support for strengthening fiscal and monetary stimulus, including a $142 billion capital injection into the major Chinese banks
"Investors welcomed the news and bid the (MSCI China Index) up over 5% after the policies were introduced on Tuesday, marking its largest single-day rally since December 2022," he said.
Updated at 1:27 PM EDT
Fading gains
Stocks are giving back some of their earlier gains heading into the final hours of trading, perhaps in a bout of profit-taking prior to tomorrow's PCE inflation report.
The S&P 500 was last seen just 4 points higher on the session, having traded as high as 5,767.37 points in the opening minutes, with the Nasdaq also flatlining from last night's close.
Not much moving in Treasury yields, however, and a solid auction of 7-year notes kept market's stable, with benchmark 10-year yields pegged at 3.794% and 2-year notes at 3.608%.
Treasury @SecYellen affirms to @SteveLiesman that she's optimistic that the U.S. economy is on track for a "soft landing."
— Squawk on the Street (@SquawkStreet) September 26, 2024
"[I always believed] that it was possible to bring inflation down while maintaining a strong labor market...that’s what the data suggests has happened." pic.twitter.com/Vw55dHnUq1
Updated at 10:50 AM EDT
Micron chips in
Micron Technology (MU) shares hit the highest levels in more than two months in early trading after the chipmaker posted stronger-than-expected fourth quarter earnings and boosted the broader sector with a robust AI-driven outlook.
Robust data center demand is exceeding our leading-edge node supply and is driving overall healthy supply-demand dynamics,' said CEO Sanjay Mehrotra. "As we move through calendar 2025, we expect a broadening of demand drivers, complementing strong demand in the data center."
Micron shares were last marked 13.5 higher at $108.76 each, having hit a two-month high of $114.80 earlier in the session.
Related: Analysts race to overhaul Micron stock price targets after earnings
Updated at 9:44 AM EDT
Record open
The S&P 500 was marked 35 points, or 0.6% higher in the opening minutes of trading, with the Nasdaq rising 192 points, or 1.07%.
The Dow, meanwhile, added 213 points while the mid-cap Russell 2000 rose 25 points, or 1.11%.
S&P 500 Opening Bell Heatmap (Sept. 26, 2024)$SPY +0.67%🟩$QQQ +1.43%🟩$DJI +0.53%🟩$IWM +0.95%🟩 pic.twitter.com/mCGqdasjvN
— Wall St Engine (@wallstengine) September 26, 2024
Updated at 8:36 AM EDT
More strength
Weekly jobless claims slipped lower again over the period ending on September 21, falling by 4,000 to 218,000. The four-week average, meanwhile, was marked 3,500 lower at 224,750.
The Commerce Department's final estimate of second quarter GDP, meanwhile, was held at 3%, a modestly firmly tally than Wall Street had forecast at 2.9%.
Stocks were little-changed in the wake of the data release, with futures tied to the S&P 50 indicating a 47 point opening bell gain and the Nasdaq called 300 points to the upside.
Treasury yields nudged higher, with 2-year note yields rising to 3.569% and 10-year notes trading at 3.791%.
🇺🇸 *US JOBLESS CLAIMS 218,000 IN SEPT. 21 WEEK; EST. 223K - BBG
— Christophe Barraud🛢🐳 (@C_Barraud) September 26, 2024
*US CONTINUING CLAIMS 1.834M IN SEPT. 14 WEEK; EST. 1.828M
Stock Market Today
Big chipmakers were the leading gainers in early Thursday trading, with Nvidia (NVDA) , Intel (INTC) and Advanced Micro Devices (AMD) all moving higher following Micron's (MU) fourth quarter update and robust near-term outlook, which provided renewed support for the AI-investment boom.
China stocks, meanwhile, are on pace for their best week in a decade following a readout from the Politburo's recent meeting, which vowed to commit to the "necessary fiscal spending" required to reach its annual 5% GDP growth target.
The news lifted stocks around the Asia region, which were already buoyed by Micron's after-hours surge, and flowed through into the European session, where the regional Stoxx 600 benchmark is closing in on its August all-time high.
A further boost to risk sentiment was provided by a Financial Times report that suggested Saudi Arabia would abandon its loosely held target of $100 a barrel in order to win back market share from the U.S.
WTI futures for November delivery, which are tightly linked to U.S. gasoline prices, were marked $1.51 lower at $68.18 a barrel even amid the closure of dozens of drilling installations in the Gulf as Hurricane Helene raced toward the Florida Big Bend coast.
Related: Analyst resets Tesla stock price target ahead of Q3 deliveries
On Wall Street, focus on the chip sector gains will be paired with new economic data, including a third revision of second-quarter GDP growth, which was last pegged at 3%, and weekly jobless claims figures.
Federal Reserve Chairman Jerome Powell is also slated to speak at a Treasury conference in New York prior to the start of trading.
Futures contracts tied to the S&P 500 suggest a big 45-point opening bell gain for the benchmark, which would take it into record territory, and a more modest 202 point advance for the Dow Jones Industrial Average.
More Wall Street Analysts:
- Analysts revise Corning stock price targets after investor meeting
- Analysts retool Carnival stock price targets ahead of earnings
- Analyst revisits Costco stock price target, rating ahead of earnings
The tech-focused Nasdaq, meanwhile, is called 276 points higher to start the session.
Overnight in Asia, Japan's Nikkei 225 finished 2.79% higher on the session, with the regional MSCI ex-Japan benchmark rising 2.01% into the close of trading.
In Europe, Switzerland's SMI rose 0.32% after the Swiss National Bank cut its benchmark interest rate by a quarter of a point, to 1%. The Stoxx 600 was last marked 1% higher in Frankfurt and Britain's FTSE 100 was up 0.37% in London.
Related: Veteran fund manager sees world of pain coming for stocks
