US STOCKS-Wall St rebounds from steep sell-off with boost from chips

Triumph

21/12/2023 19:50

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      Micron jumps on upbeat quarterly revenue forecast
    

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      Q3 GDP growth trimmed, continuing jobless claims elevated
    

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      Indexes up: Dow 0.41%, S&P 0.52%, Nasdaq 0.74%
    

  
 (Updated to 14:25 EST)
    By Stephen Culp
       NEW YORK, Dec 21 (Reuters) - 
    U.S. stocks rose on Thursday, paring the previous day's
losses, as economic data fueled optimism that the Federal
Reserve would ease monetary policy and revived investor risk
appetite.
  
    All three major U.S. stock indexes were higher, with surging
chip stocks led by Micron Technology  MU.O  after its
better-than-expected quarterly forecast, putting the tech-heavy
Nasdaq  .IXIC  out front.
    Data on Thursday showed third-quarter U.S. economic growth
was not as robust as originally stated, and cracks are appearing
in the tight labor market, which the Fed considers an obstacle
to cooling inflation.
    U.S. stocks abruptly sank late Wednesday afternoon, snapping
a multi-session rally, possibly accelerated by hedging activity
associated with short-dated option trades.
    "After a breather yesterday, the economic data further
underscored investor confidence that the Fed is now on a rate
cut track," said Greg Bassuk, chief executive officer at AXS
Investments in New York. "The investor narrative yesterday was
about profit taking on the heels of a very long consistent
holiday rally."
    "Investors would be prudent to buy on these dips," Bassuk
said, adding that he believes stocks "will end the year
strongly."
    Financial markets are pricing in a 71.3% likelihood that the
U.S. central bank with reduce the Fed funds target rate by 25
basis points as soon as March, according to CME's FedWatch tool.
  
    The market is awaiting the Commerce Department's personal
consumption expenditures (PCE) report due on Friday, which will
cover income growth, consumer spending and inflation.
    At 2:25 p.m., the Dow Jones Industrial Average  .DJI  rose
152.83 points, or 0.41%, to 37,234.83, the S&P 500  .SPX  gained
24.66 points, or 0.52%, at 4,723.01 and the Nasdaq Composite
 .IXIC  added 109.88 points, or 0.74%, at 14,887.82.
    Of the 11 major sectors of the S&P 500, consumer
discretionary stocks  .SPLRCD  enjoyed the biggest percentage
gains.
    Micron Technology  MU.O  forecast quarterly revenue above
market estimates, and its shares jumped 7.3% on signs of a
memory chip recovery in 2024 after one of the most significant
downturns in years.
    The Philadelphia SE semiconductor index  .SOX  housing chip
stocks advanced 2.0%.
    U.S. electric vehicle makers Tesla  TSLA.O , Lucid Group
 LCID.O  and Rivian Automotive  RIVN.O  rose between 2.1% and
2.4% after a report said the United States was considering
tariff hikes on Chinese EV manufacturers.
    Triumph Group  TGI.N  soared 32.1% after the aerospace
supplier said it would sell its components aftermarket business
to AAR Corp  AIR.N  for $725 million.
    U.S.-listed shares of Blackberry  BB.N  tumbled 13.8% after
its fourth-quarter revenue estimates landed below expectations.
    Advancing issues outnumbered decliners on the NYSE by a
2.54-to-1 ratio; on Nasdaq, a 2.17-to-1 ratio favored advancers.
    The S&P 500 posted 13 new 52-week highs and one new low; the
Nasdaq Composite recorded 57 new highs and 54 new lows.  
    

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Jobless claims    https://tmsnrt.rs/3GT60FK
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 (Reporting by Stephen Culp; Additional reporting by Johann M
Cherian and Shristi Achar A in Bengaluru; Editing by Richard
Chang)
 ((stephen.culp@thomsonreuters.com; 646-223-6076;))