Wall Street stocks slipped on Thursday, struggling to shake off the downbeat mood hanging over markets as investors assessed fresh data on the US economy.
The S&P 500 (^GSPC) and the Dow Jones Industrial Average (^DJI) traded about 0.1% lower just after the open. But the tech-heavy Nasdaq Composite (^IXIC) dropped 0.3%.
With the question of whether the Fed can nail a “soft landing” for the economy still a key debate, a fresh estimate for second-quarter GDP came in unchanged at 2.1%. Official figures showed jobless claims last week rose to 204,000, compared with 215,000 expected. Investors will watch for an update on pending home sales due later.
The Federal Reserve’s message that rates will remain higher for longer has rattled markets, though stocks are showing some resilience after several days of steep losses. In bonds, the rapid rise in the 10-year Treasury yield (^TNX) continued as it topped 4.6%, trading at levels not seen in over 15 years.
Both markets are under pressure from the surge in the price of oil, which hit fresh 2023 highs on Wednesday and is up over 35% since the end of June. That seen as likely to drive up fuel prices, posing a challenge to the Fed’s efforts to cool inflation — and in turn to the chances of a rate cut.
Oil prices turned lower on Thursday, as West Texas Intermediate futures (CL=F) fell to $92.93 a barrel after topping $95 earlier in the morning. Brent crude futures (BZ=F) were lower at $95.91, having neared $97 in the session.
Friday brings the week’s data highlight, the reading on PCE inflation, the Fed’s preferred gauge. However, some believe it won’t be persistent price increases that prompt central bankers to act, but insatiable American shoppers and an economy that stays too hot.
In individual stocks, shares of Micron (MU) fell in premarket trading after the chipmaker said its first-quarter loss would be wider than previously forecast.
-
JThursday’s economic data revisions mean little for the Fed, economist says
A slew of data from the Bureau of Economic Analysis out Thursday revealed a slightly cooler US economy during the second quarter than initial data showed.
The third reading of second quarter US gross domestic product (GDP) showed the economy grew at an annualized pace of 2.1% during the period, unchanged from the second reading but down from the initial reading of 2.4%. Economists surveyed by Bloomberg had expected the third reading to come in at 2.2%.
Personal consumption growth was revised down to 0.8% from 1.7%, indicating Americans consumed less in the second quarter than previously believed.
Notably, personal consumption expenditures index (PCE), the Fed’s preferred inflation gauge, grew 3.7% over the quarter, unchanged from the previous estimate.
“The revisions do not have major implications for the Fed because they leave in place the narrative of a resilient economy, and the recent inflation data were unrevised,” Oxford Economics lead US economist Michael Pearce wrote in a note on Thursday. “The focus remains on what happens from here.
“In contrast to Fed officials, we see a sharp slowdown into year end which we think will keep policymakers on the sidelines, rather than following through with an additional rate hike as planned.”
-
J
Ryan Cohen named GameStop CEO
GameStop (GME) has a new chief executive.
The video game distributor turned meme stock favorite named Ryan Cohen CEO and president on Thursday, according to a press release. The move comes after GameStop fired CEO Matthew Furlong in early June and Cohen was named executive chairman.
Cohen, the founder of Chewy (CHWY), whose net worth is estimated above $1 billion, won’t be paid for his role, according to the release.
GameStop shares rose more than 3% in early trading on the news before falling back nearly flat less than an hour into the trading day.
-
J
Stocks open mixed
Stocks were mixed just after the opening bell on Wall Street as investors digested fresh data that revealed economic growth came in slightly weaker in the second quarter than economists had projected.
At the open, the S&P 500 (^GSPC) fell just below the flat line, while the Dow Jones Industrial Average (^DJI) popped about 0.1%. The tech-heavy Nasdaq Composite (^IXIC) slipped. roughly 0.3%.
The 10-year Treasury yield (^TNX) rose to 4.66%. Meanwhile, oil slipped after hitting new 2023 highs on Wednesday. West Texas Intermediate (CL=F) fell about 1%, below $93 per barrel. Brent International (BZ=F) futures also slipped, trading down about 0.75% to below $96 per barrel.
-
Here are some of the stocks leading Yahoo Finance’s trending tickers page in premarket trading on Thursday:
CarMax (KMX): Shares in CarMax fell 12% after it posted a lower quarterly profit amid tepid demand for preowned vehicles.
GameStop (GME): GameStop shares soared 9% after…
Read More: Stocks slip as Wall Street weighs fresh GDP data: Stock market news today