US stocks climbed early Thursday in a rebound after the major indexes suffered their worst daily sell-off in months.
The S&P 500 (^GSPC) popped about 0.8% at the market open, a comeback from the biggest single-day loss for the benchmark index since October. The Dow Jones Industrial Average (^DJI) rose 0.7%, while the teach-heavy Nasdaq Composite (^IXIC) gained 1.2% after both indexes snapped nine-day win streaks.
Warnings have come from some investors that stocks were ripe for a pullback after a record-breaking rally driven by expectations the Federal Reserve will pivot to cutting interest rates, potentially as soon as March.
The market has stuck to that conviction despite pushback from central bank officials, keeping stock prices aloft until the rally’s breather on Wednesday.
There was no clear culprit for Wednesday’s sharp slide, and a number of theories were put forward by commentators: worries about the US economy after bellwether FedEx’s (FDX) downbeat revenue forecast, year-end profit-taking, and zero-day options trading among them.
In individual stocks, Micron Technology (IN) shares rose more than 8% early Thursday after the memory chipmaker’s second quarter revenue forecast topped Wall Street’s expectations. The outlook signals a 2024 revival for the memory chip sector, which has suffered a significant slump in prices.
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Short sellers lost close to $178 billion in 2023
It’s been a tough year to bet against stocks.
Short sellers on Wall Street have lost nearly $178 billion this year, according to data from S3 Partners provided to Yahoo Finance.
The top six stocks theseinvestors have lost moneyonare all part of the Magnificent 7with Alphabet (GOOGL) being the lone tech leader not atop the list. The moves reflect the unexpected nature of the 2023 stock market rally which many on Wall Street didn’t predict entering the year.
A slew of economic data was released at 8:30 a.m. ET on Thursday.
The final reading of Gross Domestic Product for the third quarter showed the US economy grew 4.9% on annualized basis in the period. This came below the prior reading of 5.2%, which economists had expected to hold.
Still, it marked the strongest quarter of economic growth since the fourth quarter of 2021.
Meanwhile, the latest data on initial jobless claims showed 205,000 people filed for unemployment insurance in the week ending December 16, below consensus estimates for 215,000 claims.
“The claims data – along with other recent labor market statistics – are consistent with a job market that is cooling but not freezing,” Oxford Economics lead US economist Nancy Vanden Houten wrote on Thursday.
Stocks open Thursday higher
US stocks climbed on Thursday, headed for a rebound from their worst daily sell-off in months as nerves settled and the prospect of interest-rate cuts buoyed spirits again.
S&P 500 (^GSPC) popped about 0.8%, staging a comeback from the biggest single-day loss since October. The Dow Jones Industrial Average (^DJI) rose 0.7%, while the teach-heavy Nasdaq Composite (^IXIC) gained 1.2% after both indexes snapped nine-day win streaks.
Meanwhile, bond yields fell with the 10-Year Treasury retreating four basis points to 3.83%, its lowest level since late July.
Stock futures point to rebound after brutal sell-off
