A slow start for stocks Thursday turned into a firm finish after the latest jobs data lowered expectations for another rate hike at next week's Fed meeting.
A bounce in several Big Tech stocks created tailwinds for the broader market, too, with all three benchmarks ending the day with solid gains.
Ahead of the opening bell, data from the Labor Department showed that initial jobless claims jumped 28,000 last week to 261,000. "The report on jobless claims released this morning came in much higher than Wall Street's estimates and was the highest weekly rate since October 2021," says Anthony Denier, CEO of Webull, a commission-free trading platform. "Typically, this should be a sign the economy is slowing down, which is bad for stocks, but it appears to have not had much of an effect on the markets."
Sign up for Kiplinger’s Free E-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.
Indeed, the tech-heavy Nasdaq Composite rose 1.0% to 13,238, the broader S&P 500 added 0.6% to 4,293, and the blue chip Dow Jones Industrial Average closed up 0.5% at 33,833.
Also fueling tailwinds for the broader market were several large-cap tech and communication services stocks, which jumped as Treasury yields retreated after Wednesday's big spike. Among the notable gainers were Apple (AAPL, +1.6%), Amazon.com (AMZN, +2.5%) and Netflix (NFLX, +2.4%).
GameStop stock spirals after earnings
On the flip side, original meme stock GameStop (GME) plunged 17.9% after the video game retailer reported earnings. GME said its first quarter net loss narrowed to $50.5 million from $157.9 million, even as net sales declined 10% year-over-year to $1.2 billion. The company also said that it fired CEO Matthew Furlong, with newly elected executive director Ryan Cohen "overseeing management" for now, according to the press release.
"We remain convinced that GameStop is doomed, with declining physical software sales and a shift of sales to subscription services and digital downloads sealing its fate," says Wedbush analyst Michael Pachter (Underperform, the equivalent of Sell). What's more, the analyst believes the "lack of clear direction and the callous termination of Mr. Furlong all but ensures that Mr. Cohen will have difficulty attracting a qualified replacement."
No bull market yet
Today's broad market gains will likely spark more headlines that the S&P 500 has entered a new bull market. Although the index is about 20% above its closing low from October 2022, "it takes more than a 20% gain off the low to proclaim the beginning of a new bull market," says Dan Burrows, senior investing writer at Kiplinger.com. As Burrows explains in his column "We Are Not in a Bull Market," a new bull market is not confirmed until the index surpasses its previous closing high.
With that in mind, investors seeking out the best stocks to buy would do well to continue to focus on high-quality companies. These can include those found among the best dividend stocks, the best blue chip stocks or the best Dow stocks – many of which tend to have sound fundamentals and are often steady long-term performers, regardless of what type of market we're in.
Related Content
-
eBay Stock Downgraded to Sell: Should Investors Be Worried?Jefferies lowered its rating on eBay stock due to decelerating advertising growth and increased marketing investments. Here's what you need to know.
-
Why MongoDB Stock Is Down After Its Beat-And-Raise QuarterMongoDB stock is spiraling Tuesday even after the tech company disclosed higher-than-expected Q3 earnings and raised its full-year outlook. Here's why.
-
Stock Market Today: Stocks Are Positively Mixed to Open DecemberTechnology led the way Monday as two of the three main equity indexes closed higher.
-
Stock Market Today: Dow, S&P 500 Hit New Highs on Black FridaySentiment was bullish on the final trading session of November, with chip stocks leading the charge.
-
Stock Market Today: Stocks Rally Despite Rising Geopolitical TensionThe main indexes were mixed on Tuesday but closed well off their lows after an early flight to safety.
-
Stock Market Today: Nasdaq Jumps Ahead of Nvidia EarningsIt was a mostly positive start to a new week of pricing in more Donald Trump.
-
Why Is Warren Buffett Selling So Much Stock?Berkshire Hathaway is dumping equities, hoarding cash and making market participants nervous.
-
Fed Cuts Rates Again: What the Experts Are SayingFederal Reserve The central bank continued to ease, but a new administration in Washington clouds the outlook for future policy moves.
-
Stock Market Today: Stocks Slip Ahead of Election Day, Fed DecisionPost-earnings strength from Amazon and Intel helped cushion the blow of a disappointing October jobs report.
-
Stock Market Today: Dow Climbs 288 Points After Amazon, Intel EarningsPost-earnings strength from Amazon and Intel helped cushion the blow of a disappointing October jobs report.
