Stocks opened lower Thursday after an unwelcome update on the labor market. Two of the three main benchmarks stayed in negative territory through the close as mega-cap tech titan Apple (AAPL) extended its recent slump.
However, one name managed to muscle into positive territory, as chipmaker Intel (INTC) extended its longest win streak in years.
Ahead of the bell, the Labor Department said initial jobless claims unexpectedly declined last week, falling by 16,000 to 216,000 – the lowest level since mid-February. This was the fourth consecutive week unemployment claims have dropped. Continuing claims also tumbled, by 40,000 to 1.68 million.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"We've seen this movie before: Weekly jobless claims once again surprise to the downside, underscoring the labor market's resilience," says Mike Loewengart, head of model portfolio construction at Morgan Stanley. "Employment continues to be a thorn in the side of the Fed, which has made softening the jobs market the cornerstone of its inflation battle."
While the Fed is likely to keep interest rates unchanged at its upcoming meeting, the central bank is "nowhere close to backing away from a higher-for-longer stance," Loewengart adds.
Apple slump continues, C3.ai sells off after earnings
In single-stock news, Apple continued its recent decline, slumping 2.9% after a Bloomberg News report suggested China could widen its ban of iPhones to include state-owned companies and government-backed agencies. AAPL stock is now down more than 6% for the week.
Elsewhere, C3.ai (AI) stock plunged 12.2% after earnings. In its fiscal first quarter, the enterprise artificial intelligence (AI) software provider reported a loss of 9 cents per share on revenue of $72.4 million. Both figures beat expectations, as did C3.ai's fiscal Q2 revenue guidance. However, C3.ai's gross margin of 68.6% missed analysts' estimates as the company ramped up artificial intelligence investments.
Despite today's earnings reaction, Wedbush Securities analyst Daniel Ives says C3.ai "is well-positioned to grab a significant portion of the generative AI market" through its partnerships and enterprise AI applications. And the company's "near-term pain" will eventually translate into "long-term gain," Ives adds.
The analyst has an Outperform (Buy) rating on C3.ai and a price target of $42, representing implied upside of more than 50% to current levels.
At the close, the rate-sensitive Nasdaq Composite was down 0.9% at 13,748 – its fourth straight loss – while the S&P 500 was off 0.3% at 4,451. The Dow Jones Industrial Average managed to add 0.2% to 34,500 on strength in Intel. The semiconductor stock jumped 3.2% to close higher for a ninth straight day, marking its longest daily win streak since December 2020.
Related content
-
Dow Trims Its Loss to 498 Points: Stock Market TodayMarkets are wondering more and more about returns on the enormous amounts of capital hyperscalers are investing in AI.
-
5 Mark Cuban Quotes Every Retiree Should Live ByThe billionaire businessman and Shark Tank alum has some advice that may surprise you.
-
Dow Falls 557 Points to Start NVDA Week: Stock Market TodayThe Oracle of Omaha saw growth and value in certain corners of the stock market during the third quarter.
-
Dow Dives 797 Points as Government Opens: Stock Market TodayThe process of pricing and re-pricing realities old and new never stops, and next week promises to be at least as exciting as this week.
-
Dow Climbs 327 Points, Crosses 48,000: Stock Market TodayMarkets are pricing the end of the longest government shutdown in history – and another solid set of quarterly earnings.
-
If You'd Put $1,000 Into Home Depot Stock 20 Years Ago, Here's What You'd Have TodayHome Depot stock has been a buy-and-hold banger for truly long-term investors.
-
Stocks Close Out Strong Month With Solid Amazon Earnings: Stock Market TodayAmazon lifted its spending forecast as its artificial intelligence (AI) initiatives create "a massive opportunity."
-
Stocks Hit Fresh Highs Ahead of the Fed As Earnings Pump Optimism: Stock Market TodaySHW and UNH were two of the best Dow Jones stocks Tuesday, thanks to solid earnings reports, and MSFT closed with a $4 trillion market cap.
-
US-China Trade Hopes Send Stocks to New Highs: Stock Market TodayApple and Microsoft are on track to join Nvidia in the $4 trillion market cap club.
-
Dow Adds 472 Points After September CPI: Stock Market TodayIBM and Advanced Micro Devices created tailwinds for the main indexes after scoring a major quantum-computing win.
