Tech companies lead Wall Street higher in early trading

By Joe Mcdonald And Matt Ott, The Associated Press on February 23, 2023.

NEW YORK (AP) – Stocks are opening higher on Wall Street following their longest losing streak in two months. The S&P 500 was 0.8% higher in early trading Thursday after falling for four straight days. The Dow Jones Industrial Average and the Nasdaq composite also rose. Tech stocks were helping to lead the way after Nvidia reported stronger results for the latest quarter than expected, thanks to demand from artificial intelligence companies and recovering strength in video gaming. It’s a turnaround for tech and high-growth stocks, which have struggled recently under the weight of worries about rising interest rates. Treasury yields held steady.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Wall Street was headed toward gains when markets open Thursday ahead of the government’s latest report on jobless claims and a another big batch of corporate earnings.

Futures for the benchmark S&P 500 rose 0.5%, while futures for the Dow Jones industrial were up 0.2% before the bell.

U.S. markets finished mixed on Wednesday after minutes from a Federal Reserve meeting showed officials expect more U.S. interest rate hikes to fight stubborn inflation.

The Fed’s key lending rate stands at 4.50% to 4.75%, up from close to zero a year ago. It has said it expects no cuts this year.

Notes from the latest Federal Reserve board meeting showed members expect “ongoing increases” in its key lending rate to slow the economy. That dampened hopes for cuts this year.

“The need for “˜higher for longer’ rates was made plain,” said Vishnu Varathan of Mizuho Bank in a report.

Though the Fed’s aggressive rate hikes have slowed inflation, there’s little indication that they’ve had much affect on the job market or broader economy. Recent data on hiring, retail sales and inflation have showed that economic activity still is strong.

Later Thursday, the Labor Department releases its weekly report on jobless claims, which serve as a proxy for layoffs. Applications for jobless aid have been under 200,000 for five straight weeks, defying the Fed’s goal of loosening the job market.

The Commerce Department later Thursday gives its second estimate of how the U.S. economy fared in the fourth quarter. The first estimate showed that the U.S. economy expanded at a 2.9% annual pace from October through December, a strong finish to 2022 considering the pressure of high interest rates and widespread fears of a looming recession.

Moderna slid more than 2% before the bell after it reported that its fourth-quarter profit tumbled 70% as COVID-19 vaccine sales fell and the drugmaker caught up on a royalty payment.

Coming later Thursday are financial results from Beyond Meat, Domino’s and Papa John’s.

In midday trading in Europe, the FTSE 100 in London lost 0.2%, Frankfurt’s DAX was up 0.6% and the CAC 40 in Paris climbed 0.5%.

In Asia, the Shanghai Composite Index lost 0.5% to 3,276.19 and the Hang Seng in Hong Kong fell 0.5% to 20,323.24.

The Kospi in Seoul rose 1% to 2,442.26 after South Korea’s central bank left its key lending rate unchanged. Sydney’s S&P-ASX 200 shed 0.4% to 7,285.40.

India’s Sensex advanced less than 0.1% to 59,801.66. New Zealand and Jakarta advanced while Singapore and Bangkok declined.

Japanese markets were closed for a holiday.

The yield on the 10-year Treasury inched back up to 3.95%, near its highest level since November. The two-year yield, which moves more on expectations for the Fed, was unchanged at 4.70%. It’s also been near its highest level since November.

In energy markets, benchmark U.S. crude gained 74 cents to $74.69 per barrel in electronic trading on the New York Mercantile Exchange. The contract tumbled $2.41 on Wednesday to $73.95. Brent crude, the price basis for international oil trading, advanced 80 cents to $81.25 per barrel in London. It fell $2.45 the previous session to $80.60.

The dollar ticked up to 135.01 yen from Wednesday’s 134.99 yen. The euro was back up to $1.0615.

On Wednesday, the S&P 500 lost 0.2%. Its gain this year has narrowed to 3.9% from a peak of 8.9%.

The Dow slid 0.3% while the Nasdaq composite edged up 0.1%.

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McDonald reported from Beijing; Ott reported from Silver Spring, Md.

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