Tech Leads Stock Gains as Data Reinforce Fed Bets: Markets Wrap

(Bloomberg) — US stocks were poised for a rebound amid a rally in tech companies, with data showing labor-market softening bolstering the outlook for rate cuts. The euro wavered as the European Central Bank remained on hold.

Most Read from Bloomberg

Futures on the tech-heavy Nasdaq 100 outperformed after a solid outlook from Taiwan Semiconductor Manufacturing Co. spurred a rally in chipmakers. Netflix Inc. is due to report results after market close. Meta Platforms Inc. has explored a multibillion euro investment into the maker of Ray-Ban sunglasses, the Financial Times reported. Homebuilder D.R. Horton Inc. wavered after reporting weaker-than-expected quarterly orders.

Initial jobless claims increased by 20,000 to 243,000 in the week ended July 13, according to Labor Department data released Thursday. The median forecast in a Bloomberg survey of economists called for 229,000 applications.

“The Fed asked to see more evidence of a cooling economy, and for the most part, they’ve gotten it,” said Chris Larkin at E*Trade from Morgan Stanley. “Add today’s weekly jobless claims to the list of rate-cut-friendly data points. And with Jerome Powell saying the Fed won’t wait for inflation to fall to 2% before cutting rates, the path to September remains open.”

The ECB left interest rates unchanged after last month’s landmark cut — giving away little on its plans as investors and economists bet on another move in September. It reiterated that borrowing costs will remain “sufficiently restrictive for as long as necessary” to ensure inflation returns to 2%.

S&P 500 futures rose 0.2%. Nasdaq 100 futures added 0.6%. The yield on 10-year Treasuries advanced one basis point to 4.17%.

Corporate Highlights:

United Airlines Holdings Inc. said third-quarter profit will fall short of Wall Street’s expectations as US carriers slash ticket prices to lure domestic travelers, keeping even the industry’s largest players from fully capitalizing on record summer travel.
Domino’s Pizza Inc.’s shares fell as second-quarter results showed that discounts and new product launches weren’t strong enough to attract more value-seeking diners.
Blackstone Inc.’s real estate arm weighed on the investment giant’s second-quarter results, as high interest rates crimped property valuations and investors pumped less money into the business.
Ford Motor Co. plans to invest $3 billion to build its highly profitable Super Duty F-series pickup truck at a plant in Ontario, Canada, that was earmarked to make an electric sport utility vehicle that the company previously delayed by two years.
Abbott Laboratories nudged up its full-year profit guidance as strong growth in its medical-devices segment helped quarterly results beat estimates.
Sales of Novartis AG’s closely-watched prostate cancer drug Pluvicto disappointed in the latest quarter, taking the shine off a raised profit forecast from the Swiss pharma company.
Nokia Oyj sales in the second quarter were the lowest of any period since 2015 and missed analyst estimates, as weak investment in mobile network upgrades continues to hobble the 5G equipment market.
Infosys Ltd. raised its sales forecast for the year in a sign that clients are gradually beginning to boost technology spending, encouraged by a resilient global economy.
Warner Bros. Discovery Inc. is considering splitting its streaming and studio businesses from legacy TV, one of several options intended to boost its share price, the Financial Times reported.

Key events this week:

Some of the main moves in markets:

Stocks

S&P 500 futures rose 0.2% as of 8:39 a.m. New York time
Nasdaq 100 futures rose 0.6%
Futures on the Dow Jones Industrial Average fell 0.2%
The Stoxx Europe 600 rose 0.4%
The MSCI World Index was little changed

Currencies

The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.0935
The British pound fell 0.2% to $1.2988
The Japanese yen was little changed at 156.28 per dollar

Cryptocurrencies

Bitcoin rose 0.7% to $64,970.23
Ether rose 1.5% to $3,467.77

Bonds

The yield on 10-year Treasuries advanced one basis point to 4.17%
Germany’s 10-year yield advanced one basis point to 2.43%
Britain’s 10-year yield declined three basis points to 4.05%

Commodities

West Texas Intermediate crude was little changed
Spot gold rose 0.3% to $2,466.29 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Sujata Rao and John Viljoen.