A renewed rally in tech megacaps fueled a rebound in stocks as bond yields retreated on the eve of the jobs report amid speculation the Federal Reserve will be able to pause its interest-rate hikes this month.
(Bloomberg) — A renewed rally in tech megacaps fueled a rebound in stocks as bond yields retreated on the eve of the jobs report amid speculation the Federal Reserve will be able to pause its interest-rate hikes this month.
The Nasdaq 100 outperformed major equity benchmarks, with the likes of Nvidia Corp. and Meta Platforms Inc. up at least 2.5%. Two-year yields, which are more sensitive to imminent Fed moves, dropped three basis points to 4.37%.
US factory activity shrank for a seventh month in May as orders contracted at a faster pace, while a measure of materials costs fell by the most in nearly a year. Employment growth at US companies last month exceeded all projections, highlighting a durable labor market that continues to buttress the economy.Â
The monthly jobs report on Friday, which includes government payrolls, will provide further insight into the direction the labor market is headed. Forecasters project the government’s report to show a moderation in the pace of hiring.
The House passed debt-limit legislation forged by President Joe Biden and Speaker Kevin McCarthy that would impose restraints on government spending through the 2024 election and avert a destabilizing US default. Lawmakers from both parties joined to approve the bill Wednesday evening, sending the measure to the Senate for consideration.
In other corporate news, Macy’s Inc. dropped after cutting its earnings outlook. Salesforce Inc. fell after the software company gave a lackluster forecast for sales. Dollar General Corp. slumped after the discount retailer slashed its annual profit forecast. Nordstrom Inc. gained after the department-store chain’s quarterly revenue and profit came in slightly ahead of estimates.Â
Some of the main moves in markets:
Stocks
- The S&P 500 rose 0.5% as of 10:47 a.m. New York time
- The Nasdaq 100 rose 0.6%
- The Dow Jones Industrial Average was little changed
- The Stoxx Europe 600 rose 0.8%
- The MSCI World index rose 0.7%
Currencies
- The Bloomberg Dollar Spot Index fell 0.4%
- The euro rose 0.4% to $1.0732
- The British pound rose 0.6% to $1.2519
- The Japanese yen rose 0.2% to 139.01 per dollar
Cryptocurrencies
- Bitcoin fell 0.8% to $26,904.02
- Ether fell 0.2% to $1,861.43
Bonds
- The yield on 10-year Treasuries declined four basis points to 3.61%
- Germany’s 10-year yield declined two basis points to 2.26%
- Britain’s 10-year yield declined six basis points to 4.12%
Commodities
- West Texas Intermediate crude rose 1.1% to $68.84 a barrel
- Gold futures rose 0.5% to $1,993 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Emily Graffeo, Vildana Hajric and Peyton Forte.
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