On Thursday, stocks slipped after an initial upturn faltered. The major averages ended the day short of their best levels, notably the Nasdaq and the S&P 500 which closed in the red. The technology sector particularly contributed to this low performance with the Nasdaq falling 0.5 percent to 15,601.50 and the S&P 500 losing 0.2 percent to settle at 5,011.12. By contrast, the Dow nudged higher by 0.1 percent to 37,775.38.
The Nasdaq and the S&P 500's decline marked their fifth consecutive day of losses, hitting their lowest closing levels in nearly two months. Traders' attempts at bargain hunting provided initial Wall Street strength, but the persistence of interest rate worries gradually diminished buying enthusiasm.
The Philadelphia Federal Reserve's report, indicating a significant increase in regional manufacturing activity in April, added to the anxiety about interest rates. The Philly Fed's index for current general activity rose to 15.5 from 3.2 in March, surpassing economists' prediction of a 1.5 decline.
The report also revealed a jump in the prices paid index from 3.7 in May to 23.0 in April — the highest since December 2023. LPL Financial's Chief Global Strategist, Quincy Krosby, emphasized that this spike underlined the Federal Reserve's inflation-related concerns.
A separate Labor Department report showed stagnant U.S. unemployment benefits claims for the week ending April 13th, with initial jobless claims remaining at 212,000. However, Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics, reassured that the "jobless claims remain well below levels that would signal a major slowdown in job growth."
Simultaneously, the National Association of Realtors reported a 4.3 percent drop in existing home sales in March, falling to 4.19 million after a 9.5 percent increase to 4.38 million in February.
In sectoral news, semiconductor stocks suffered due to poor performance by Taiwan Semiconductor Manufacturing (TSM), even though the chipmaker reported superior first-quarter results. Biotechnology, software, computer hardware, and oil production sectors also experienced a downfall, while airlines such as Alaska Air (ALK), which reported smaller than anticipated first-quarter losses, did well.
In global markets, most Asia-Pacific stocks gained, with China's Shanghai Composite Index and Japan's Nikkei 225 Index increasing slightly, and South Korea's Kospi surging by 2.0 percent. Major European markets also advanced with France's CAC 40 Index, the U.K.'s FTSE 100 Index, and the German DAX Index all rising.
On Friday, investors' attention may shift towards corporate earnings news, in the absence of any major U.S. economic developments. Streaming company Netflix and credit card giant American Express are set to release their quarterly results.
