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
-
Stocks Can't Hold Meta, Microsoft Gains: Stock Market TodayThe main indexes all opened higher Thursday on impressive Big Tech earnings, but momentum faded into the close.
-
Retirement Health Care Costs Are On the Rise: What You Need to KnowA 65-year-old retiree will face significantly higher lifetime health care costs than they would have a year ago, even with Medicare. Here are the surprising totals.
-
Stocks Can't Hold Meta, Microsoft Gains: Stock Market Today
The main indexes all opened higher Thursday on impressive Big Tech earnings, but momentum faded into the close.
-
How to Invest for a Fall Interest Rate Cut by the FedA lot can happen between now and then, but the probability the Fed cuts interest rates before the end of the year is better than 85%.
-
Stocks Are Up and Down on Fed Day: Stock Market TodayIn another sign of changing times, JPMorgan has partnered with Coinbase to enable cryptocurrency purchases with credit cards.
-
Stocks Close Mixed to Start Fed Week: Stock Market TodayNews of an EU-U.S. trade deal was met with muted reaction from market participants who are looking ahead to a jam-packed week.
-
Stocks Rise After Trump-Powell Fed Tour: Stock Market TodayNvidia hit a new all-time high intraday, but another renowned semiconductor name and some less iconic stocks were bigger movers Friday.
-
Are Buffett and Berkshire About to Bail on Kraft Heinz Stock?Warren Buffett and Berkshire Hathaway own a lot of Kraft Heinz stock, so what happens when they decide to sell KHC?
-
Dow Bleeds Red Due to Big Blue: Stock Market TodaySix of the official GICS sectors were in the green, led by communications services, technology and energy stocks.
-
The Best Stocks of the CenturyAs we near the 25-year mark, we looked at which stocks have returned the most. Here are the 10 best stocks of the century so far.
