Dow opens higher as rate cut bets strengthen, Salesforce rises
Stocks were relatively unchanged on Thursday as investors grow more confident in a December interest rate cut from the Federal Reserve.
The Dow Jones Industrial Average rose 96 points, or 0.2%. The S&P 500 added 0.2% and the Nasdaq Composite gained 0.2%.
Investors focused on a report from job placement firm Challenger, Gray & Christmas showing announced job cuts in November from U.S. employers moved further ahead of 1 million for the year as corporate restructuring, artificial intelligence and tariffs helped pare job rolls. On Wednesday, numbers from ADP revealed a surprising slump in private payrolls.
Mounting signs that the labor market is softening has led Wall Street to be convinced the Fed will cut rates a quarter percentage point at its Dec. 10 meeting, the last of the year. Markets are pricing in an 89% chance of a cut next Wednesday, far higher than just a couple weeks ago, according to the CME FedWatch tool.
On Thursday, investors largely overlooked the latest weekly jobless claims numbers that showed new applications for unemployment insurance at their lowest level since Sept. 2022. Jobless claims for the week ending Nov. 29 totaled a seasonally adjusted 191,000, down 27,000 from the prior period and below the Dow Jones consensus estimate for 220,000.
Salesforce, a member of the Dow Jones Industrial Average, edged higher after the software company offered a stronger-than-expected revenue forecast. Five Below also rose after the discount retailer’s earnings flew past Wall Street’s estimates.
Other important economic releases this week come Friday when the Commerce Department releases delayed September data on consumer spending and incomes and the personal consumption expenditures index, the Fed’s primary inflation gauge. The University of Michigan will also release its consumer survey for December on Friday.
All three major stock market average are close to record highs after notching gains Wednesday, though the artificial intelligence trade continued to wobble. The tech sector was the biggest laggard among S&P 500 sectors, dragged lower by losses in Microsoft, Nvidia and Broadcom.
Microsoft shares closed 2.5% lower after The Information reported that the company was lowering its software sales targets tied to artificial intelligence. Microsoft refuted the claims in the report, which led the stock to recover from its lows of the session.
Source : Cnbc.com
