On Thursday, stock markets displayed modest gains for the majority of the session, only to surrender their advances late in the trading day, ultimately closing nearly unchanged. However, the Dow Jones Industrial Average still achieved a new record high at the close.
The Dow concluded the session with a gain of 161.35 points, or 0.4%, finishing at 43,239.05. Meanwhile, the Nasdaq inched up by 6.53 points, less than 0.1%, to 18,373.61, and the S&P 500 slightly dipped by 1.00 point, also less than 0.1%, closing at 5,841.47.
Semiconductor stocks notably bolstered the market during most of the session, despite a late-session retreat, leading to the Philadelphia Semiconductor Index closing up by 1.0%. This sector's strength was largely attributed to Taiwan Semiconductor Manufacturing Company's (TSMC) impressive increase in third-quarter profits.
TSMC's robust financial performance helped alleviate concerns over the future demand for semiconductors, which arose after Dutch chipmaker ASML issued a warning earlier in the week. "The global stock market fortunes hinged on TSMC's results, and thankfully, the outlook in the AI sector remains positive," noted Dan Coatsworth, investment analyst at AJ Bell.
Positive market sentiment was further reinforced by largely encouraging U.S. economic data, such as a report by the Commerce Department showing retail sales exceeded expectations in September. Specifically, retail sales grew by 0.4% in September, following a 0.1% increase in August, against economists' projections of a 0.3% rise.
Excluding motor vehicles and parts, retail sales rose by 0.5% in September, up from August's 0.2% increase, surpassing the anticipated 0.1% uptick.
Additionally, a Labor Department release showed an unexpected decline in initial U.S. unemployment benefit claims for the week ending October 12th. Initial jobless claims fell to 241,000, a reduction of 19,000 from the revised 260,000 in the previous week, contrary to predictions of a rise to 260,000.
This unexpected drop caused jobless claims to reverse after hitting their peak since June 17, 2023, when they reached 261,000.
In a separate development, the Federal Reserve reported a slightly greater-than-expected decline in U.S. industrial production in September. Industrial production fell by 0.3% in September, following a downward revision to a 0.3% increase in August. Economists had anticipated a 0.2% decrease compared to the initially reported 0.8% rise in the previous month. This dip was partly attributed to a strike at Boeing and the impact of Hurricanes Helene and Milton.
International Markets:
In overseas trading, the Asia-Pacific stock markets mostly declined on Thursday. Japan's Nikkei 225 Index dropped by 0.7%, while China's Shanghai Composite Index decreased by 1.1%.
Conversely, major European markets advanced after the European Central Bank (ECB) lowered interest rates. The French CAC 40 Index surged by 1.2%, the German DAX Index climbed by 0.8%, and the U.K.'s FTSE 100 Index rose by 0.7%.
In the bond market, treasury bonds retreated after showing an upward trend in recent sessions, leading to the yield on the benchmark ten-year note, which moves inversely to its price, increasing by 7.7 basis points to 4.093%.
Looking Forward:
Anticipation surrounding upcoming earnings announcements may influence trading on Friday. Notably, streaming leader Netflix (NFLX) is set to release its quarterly results after today's market close.
