From Nasdaq: 2024-07-31 12:36:26

US stocks surged today, with the S&P 500 up 1.71%, Dow Jones up 0.44%, and Nasdaq up 2.89%. Chip stocks led the rally, with Nvidia up 10% after being named a top pick. ASML Holding NV rose 7% on news of an exemption from US export restrictions and Advanced Micro Devices climbed 6% on a positive revenue forecast. The 10-year T-note yield fell to a 4-1/2 month low after weak economic data.

The US ADP employment change for July rose 122,000, below expectations, and the Q2 employment cost index increased by 0.9% q/q, underperforming estimates. The MNI Chicago PMI dropped to 45.3 but pending home sales for June rose by 4.8% m/m. The FOMC meeting concluded with expectations of keeping the fed funds target range unchanged and potential interest rate cuts in September.

The BOJ unexpectedly raised its benchmark interest rate. Tech giants like Meta, Apple, and Amazon are set to report earnings. Nvidia is expected to report on August 28. The S&P 500 earnings consensus stands at a 9% y/y increase, with most companies beating earnings but falling short of revenue expectations. The likelihood of a rate cut by the Fed has markets on edge.

Interest rates saw a decline with 10-year T-notes at a 4.099% yield. T-note prices rose due to geopolitical tensions, inflation concerns, and the fed’s dovish stance. European bond yields followed a similar trend. Eurozone CPI exceeded expectations. The likelihood of an ECB rate cut stands at 95%.

Stocks like Nvidia, Vistra Corp, and Match Group saw gains, while Verisk Analytics and Humana faced losses. The chip sector rebounded, with Broadcom, ARM Holdings, and Micron Technology up. BorgWarner, Dupont de Nemours, and Starbucks saw positive movement, while Bunge Global and Verisk Analytics faced declines. Microsoft, Groupon, Pinterest, and Marriott International were among the losers.



Read more at Nasdaq: Stocks Rally as Chip Stocks Rebound and Bond Yields Fall