US STOCKS-S&P 500 snaps losing streak on jobless claims rise

Rent the Runway

08/12/2022 21:03

(For a Reuters live blog on U.S., UK and European stock
markets, click  LIVE/  or type LIVE/ in a news window.)

        * 
      Weekly jobless claims rise in line with estimates
    

        * 
      Moderna, Pfizer up as FDA authorizes updated COVID
boosters
    

        * 
      Exxon climbs after boosting buyback program
    

  
 (Updates to close, adds comment)
    By David French
       Dec 8 (Reuters) - 
    The S&P 500  .SPX  closed higher on Thursday, snapping a
five-session losing streak, as investors pushed the index higher
after interpreting data showing a rise in weekly jobless claims
as a sign the pace of interest rate hikes could soon slow.
    Wall Street's main indexes had come under pressure in recent
days, with the benchmark index shedding 3.6% since the beginning
of December on expectations of a longer rate-hike cycle and
downbeat economic views from some top company executives.
    Such thinking had also weighed on the tech-heavy Nasdaq
Composite Index  .IXIC , which had posted four straight losing
sessions prior to Thursday.
    However, investors drew some comfort after data showed the
number of Americans filing claims for jobless benefits increased
moderately last week, while unemployment rolls hit a 10-month
high toward the end of November.
    The report follows data last Friday that showed U.S.
employers hired more workers than expected in November and
increased wages, spurring fears that the Fed might stick to its
aggressive stance to tame decades-high inflation.
    "The market has to adjust to the fact that we're moving from
a stimulus-based economy - both fiscal and monetary - into a
fundamentals-based economy, and that's what we're grappling with
right now," said Wiley Angell, chief market strategist
at Ziegler Capital Management.
    The producer price index and the University of Michigan's
consumer sentiment survey on Friday and November's consumer
price data next week will also be in focus ahead of Fed's policy
decision on Dec. 14.
    Investors see a 93% chance that the U.S. central bank will
hike the key benchmark rate by 50 basis points to 4.25-4.50%,
with the rates peaking in May 2023 at 4.92%.  FEDWATCH 
    The U.S. central bank has raised its policy rate by 375
basis points this year, the fastest pace since the 1980s.
    This aggressive approach has stoked worries of a recession,
with top executives of major U.S. financial institutions
including JPMorgan, BlackRock and Citi forecasting a likely
economic downturn in 2023.
    Adding to the fears, the yield curve between the 2-year
 US2YT=RR  and 10-year Treasury notes  US10YT=RR  has also
widened in the recent days.
    According to preliminary data, the S&P 500
 .SPX  gained 29.89 points, or 0.76%, to end at 3,963.81 points,
while the Nasdaq Composite  .IXIC  gained 125.84 points, or
1.15%, to 11,084.39. The Dow Jones Industrial Average
 .DJI  rose 174.89 points, or 0.54%, to 33,772.81.
    Most of the 11 major S&P 500 sectors rose, led by a gain in
technology stocks  .SPLRCT .
    Most mega-cap technology and growth stocks such as Apple Inc
 AAPL.O , Nvidia Corp  NVDA.O  and Amazon.com Inc  AMZN.O  rose.
    Microsoft Corp  MSFT.O  ended higher, despite giving up some
intraday gains after the Federal Trade Commission filed a
complaint aimed at blocking the tech giant's $69 billion bid to
buy Activision Blizzard Inc  ATVI.O . The "Call of Duty" games
maker closed lower.
    The energy index  .SPNY  was one of the exceptions despite
Exxon Mobil Corp gaining after announcing it would expand its
$30-billion share repurchase program. The sector had been under
pressure in recent sessions as commodity prices slipped: U.S.
crude  CLc1  is now hovering near its level at the start of
2022.
    Meanwhile, Moderna Inc  MRNA.O  advanced after the U.S. Food
and Drug Administration authorized COVID-19 shots from the
vaccine maker that target both the original coronavirus and
Omicron sub-variants for use in children as young as six months
of age.
    The regulator also approved similar guidance for fellow
COVID vaccine maker Pfizer Inc  PFE.N , which rose, and its
partner BioNTech, whose U.S.-listed shares  BNTX.O  gained.
    Rent the Runway Inc  RENT.O  jumped after the clothing
rental firm raised its 2022 revenue forecast.
 (Reporting by Shubham Batra, Ankika Biswas, Johann M Cherian in
Bengaluru and David French in New York; Editing by Vinay
Dwivedi, Sriraj Kalluvila, Anil D'Silva and Richard Chang)
 ((Shubham.Batra@thomsonreuters.com;))