The tech-heavy Nasdaq 100 rose along with US Treasuries on Thursday after data showing US jobless claims surged more than expected last week.
(Bloomberg) — The tech-heavy Nasdaq 100 rose along with US Treasuries on Thursday after data showing US jobless claims surged more than expected last week.
The jump in jobless claims to the highest since October 2021 shows that the labor market, while largely resilient, is starting to show signs of cooling. That delivered a boost to the tech sector, which has been flagging under speculation that the Federal Reserve will keep interest rates higher for longer.
The Russell 2000 index fell, paring its gains for the week to just over 2%. And among individual movers, Carvana Co. surged 26% on second quarter guidance, while GameStop Corp. plunged 19% after firing its chief executive and reporting sales that fell short of estimates.
Investors are reassessing the trajectory of Fed policy after central banks in Australia and Canada this week unexpectedly raised rates.
Read More: The US Big Tech Bull Case Is Starting to Show Signs of Fatigue
“The key thing to remember is that the fight against inflation isn’t over,” Helen Jewell, EMEA deputy CIO of BlackRock Fundamental Equities, said in an interview with Bloomberg Television. “We’re seeing the stickiness in inflation and concerns coming through from a rate hike perspective.”
Still, Evercore ISI’s Krishna Guha said market moves on central bank actions from Canada and Austrialia should fade. “The Fed is the price-setter here, the others are the price-takers, and we should not confuse the two,” Guha said. “They are raising rates in part because they think the Fed will hike once more and if they fail to match this they risk FX depreciation.”
In Europe, SBB, the company at the center of Sweden’s property crisis, sank 9.3%, leading the Stoxx 600 lower. The company, also known as Samhallsbyggnadsbolaget i Norden AB, was sent even further into junk territory by S&P Global Ratings, a move that will worsen the already severe funding crunch.
In currencies, the yen strengthened after Japan’s economy grew faster than expected in the first quarter.
The Turkish lira stabilized against the dollar after state lenders began supporting the currency again. The lira has endured a historic selloff recently on speculation that the Turkey might changed its long-held stance of state interventions after the appointment of a new finance minister.
The dollar weakened, and gold gained.
Key events this week:
- US wholesale inventories, Thursday
- China PPI, CPI, Friday
Stocks
- The S&P 500 rose 0.4% as of 11:13 a.m. New York time
- The Nasdaq 100 rose 1.1%
- The Dow Jones Industrial Average rose 0.3%
- The Stoxx Europe 600 was little changed
- The MSCI World index fell 0.3%
Currencies
- The Bloomberg Dollar Spot Index fell 0.6%
- The euro rose 0.7% to $1.0774
- The British pound rose 0.8% to $1.2540
- The Japanese yen rose 0.9% to 138.91 per dollar
Cryptocurrencies
- Bitcoin rose 0.9% to $26,604.65
- Ether rose 0.7% to $1,854.68
Bonds
- The yield on 10-year Treasuries declined six basis points to 3.74%
- Germany’s 10-year yield declined four basis points to 2.42%
- Britain’s 10-year yield was little changed at 4.26%
Commodities
- West Texas Intermediate crude fell 0.8% to $71.93 a barrel
- Gold futures rose 1.3% to $1,983 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Stephen Kirkland, Allegra Catelli and Eva Szalay.
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