Thursday's Top Reads
Read the top stories on Thursday:
That big one-day stock-market surge we just had? Don’t make too much of it.
Stocks surge on inflation data. Trump, bond yields hold the key to what’s next.
Mortgage rates rise past a key mark, signaling bad news for home buyers
Here’s how much lumber Southern California will need to rebuild after the wildfires
Latest Updates
Updated 1 day ago
By
Joy Wiltermuth
Major U.S. stock indexes closed lower on Thursday, pausing a powerful rally sparked a day earlier by falling bond yields and encouraging signs on the inflation front.
The Dow Jones Industrial Average fell 68.42 points, or 0.2%, ending at 43,153.13.
The S&P 500 index lost 12.57 points, or 0.2%, ending at 5,937.34.
The Nasdaq Composite Index shed 172.94 points, or 0.9%, closing at 19,338.29.
A rough patch for stocks has left the Dow up only 2.2% since the Nov. 5 election, according to Dow Jones Market Data. Its peak "Trump bump" close of 45,014.04 on Dec. 4 had the index up 6.6% from its Nov. 5 close.
Shares of Apple Inc. and Tesla Inc. both fell more than 3% Thursday, even as longer 10-year Treasury yields logged a three-session decline of nearly 20 basis points. That was its biggest such drop since Aug. 5, according to Dow Jones Market Data — with the August three-day decline coming on the heels of a drastic unwind of the Japanese yen carry trade.
The 10-year yield fell to 4.606% Thursday, retreating from its one-year high of 4.802% set on Monday. But a cautious tone remained in markets, with investors focused on what policies might be a top priority under the incoming Trump administration — and the Treasury market's likely reaction to them.
1 day ago
By
Joseph Adinolfi
On Friday, options traders will face the first expiration of monthly contracts of 2025. Contracts tied to $4.2 trillion worth of stocks, ETFs and indexes will either be exercised, or expire worthless, according to data from SpotGamma.
The $4.2 trillion figure is smaller than December's record-breaking "triple witching" expiration, which came in at $6.6 trillion, according to data from Asym 500.
Still, SpotGamma founder Brent Kochuba pointed out that the value of single-stock options expiring is "unusually large," owing to Wednesday's strong stock-market rally. He added that the expiration could mark a near-term top for the market.
"Relative call values surged due to yesterday's large rally, and the expiring of these calls may mark a short-term top in the market, particularly ahead of the inauguration and FOMC," Kochuba said in emailed commentary.
1 day ago
By
Vivien Lou Chen
U.S. government debt rallied for a third session on Thursday, pushing yields to their lowest closing levels in weeks, after Fed governor Christopher Waller opened the door to the possibility of three or four rate cuts in 2025.
The 2-year yield ended at 4.237%, the lowest since Dec. 12. The 10-year rate finished at 4.606%, the lowest since Jan. 3.
1 day ago
By
Joy Wiltermuth
Investors were showing reluctance to add to Wednesday's big gains, with all three major indexes under pressure in the final hour of trade.
Small-caps, utilities and real-estate stocks were being bought on the back of easing Treasury yields. The same wasn't the case for rate-sensitive technology stocks, including megacap names like Apple Inc. and Tesla Inc.
"We do think equity markets will continue to move up," said Luke Tilley, chief economist and head of economics, asset allocation and quantitative services for Wilmington Trust Investment Advisors, in an interview.
But Tilley is also cautious on large-cap stocks due to uncertainty about policies from the second Trump administration that could drive the 10-year Treasury yield higher. He also expects the labor market to weaken from here and for inflation to ease further, opening up the potential for 100 basis points of Federal Reserve interest-rate cuts in 2025.
1 day ago
The big three U.S. equity indexes were modestly lower Thursday, but small caps were bucking the trend.
The Russell 2000 index was up 0.1% in the final hour of trade, but also outperforming its large-cap counterparts with a 3.5% gain so far this week, according to FactSet.
The S&P 500 was struggling to secure a fourth straight day of gains Thursday, and was up 2.1% so far in the week.
1 day ago
By
Joy Wiltermuth
Bank earnings set a positive tone this week as more major corporations gear up to roll out their quarterly results.
Net interest margins, credit trends and overall consumer and business lending look very solid, said Anthony Saglimbene, chief market strategist at Ameriprise Financial.
"I think that’s given investors a needed catalyst to say: Things are okay," he told MarketWatch. But any big disappointments in earnings, especially from highflying tech stocks, could deliver a shock to markets, he added.
So could any aggressive rollout of tariffs by the Trump administration or any strong retaliatory response from U.S. trading partners, Saglimbene said.
Inflation progress might be stalling in some areas, but Saglimbene said that isn't his main concern for 2025.
1 day ago
By
Christine Idzelis
An equal-weight measure of the S&P 500 was rising Thursday afternoon, even as major U.S. stock indexes traded down.
The Invesco S&P 500 Equal Weight ETF, which tracks an index that equally weights stocks in the broad U.S. large-cap equities index, was up 0.6% in afternoon trading, according to FactSet data, at last check. The ETF was outperforming the S&P 500, which has heavy exposure to stocks in the information-technology sector.
The S&P 500 was down 0.1% in afternoon trading, while the Dow Jones Industrial Average fell 0.2% and the tech-heavy Nasdaq Composite dropped 0.5%, according to FactSet data, at last check.
1 day ago
By
Joy Wiltermuth
The tech-driven selloff in stocks was gathering some steam in afternoon trade, leaving the Nasdaq Composite and S&P 500 near their session lows.
Dow was off about 115 points, or 0.3%, near 43,101.
S&P 500 was 0.3% lower, near 5,932.
Nasdaq Composite shed about 160 points, or 0.8%.
1 day ago
By
Joy Wiltermuth
Investors were "holding tight" as the nation's biggest banks kicked off fourth-quarter earnings season on a positive note and ahead of the inauguration of President-elect Donald Trump on Jan. 20, said Peter Cardillo, chief market economist at Spartan Capital Management.
"Basically, it's a bit of sideways movement" in stocks on mixed economic data and as the "earnings season is getting off to a good start," Cardillo told MarketWatch.
The parade of earnings due to get under way next week could be a catalyst for a pullback — or it could pave the way for fresh record highs for stocks, he said.
The bond market, however, has been paying close attention to Thursday's Senate confirmation hearing for Scott Bessent, the nominee for Treasury secretary, in order to get a sense of the incoming Trump administration's policy priorities. "He's making a big pitch for the extension of 2017 tax cuts," Cardillo said of Bessent.
1 day ago
By
Joy Wiltermuth
Stocks and bond yields were meandering Thursday afternoon as investors tuned in to a Senate hearing for Treasury secretary nominee Scott Bessent for clues about the policy priorities of the incoming Trump administration.
Standouts, however, in stocks were the S&P 500's rate-sensitive utilities and real-estate sectors, which were up 2.1% and 1.5%, respectively, according to FactSet. The broader S&P 500 was up less than 0.1%.
The sharp rise in longer Treasury yields since November pulled both sectors lower. But they were getting a nice bounce as the 10-year yield pulled back to about 4.6% from a high of 4.8% earlier in the week.