Stocks rebounded with chip stock strength, supported by labor market data, despite US-China trade tensions

From Nasdaq: 2025-02-05 19:25:07

Stock indexes closed higher on Wednesday, with the S&P 500 up +0.39%, Dow Jones up +0.71%, and Nasdaq 100 up +0.42%. The rally was supported by a sharp decline in bond yields and strong labor market data. Concerns over US-China trade tensions remain. Earnings reports impacted tech stocks negatively.

US labor market strength was evident as Dec ADP employment change beat expectations. Megacap tech stocks saw declines due to disappointing earnings, with Alphabet and AMD among the losers. US-China trade tensions escalated, with tariffs imposed on both sides.

The 10-year T-note yield fell to a 7-week low, impacting markets. The US Dec trade deficit widened, affecting GDP. The Jan ISM services index fell, indicating economic challenges. Fed policymakers are monitoring economic uncertainties. Earnings season is in full swing, with estimates positive for S&P 500 earnings.

European bond yields fell, impacting T-notes. Swaps show expectations for an ECB rate cut. US stock movers included chip stocks rallying, with Johnson Controls and Electronic Arts leading gains. Companies like Amgen and Fiserv also reported positive earnings. Alphabet, AMD, FMC Corp, and Uber faced losses.



Read more at Nasdaq: Stocks Rebound and Close Higher on Chip Stock Strength