/cdn.vox-cdn.com/uploads/chorus_asset/file/25550621/voultar_snes2.jpg "This Chip Fixes a Long-Standing Super Nintendo Glitch")
Stocks opened lower as investors continued to digest the impact of disappointing Big Tech earnings reports, coupled with rising bond yields.
The Nasdaq (^IXIC) and heavy-duty S&P 500 (^GSPC) fell about 0.5% and 0.4%, respectively, while the Dow Jones Industrial Average (^DJI) held the flat line.
Technology stocks remain under pressure after recording their worst single-day performance in eight months on Wednesday.
Earnings are in the driver’s seat for stocks, as investors punish major companies whose third-quarter reports were more pessimistic than expected.
While META’s earnings beat top and bottom lines, its shares reversed initial gains after Facebook’s parent company warned that geopolitical turmoil could impact its advertising business. Earnings flow resumes on Thursday, with Amazon (AMZN), Intel (INTC), Ford (F), and Chipotle (CMG) stocks highlighting the docket.
Concerns are growing that valuations are too high in a world of rising Treasury yields.
On Thursday, the benchmark 10-year yield (^TNX) fell a modest 3 basis points to trade near 4.92% after the latest GDP reading came in hot, with the US economy growing at its fastest pace in almost two years.
Bureau of Economic Analysis Advance estimate of US GDP for the third quarter It showed that the economy grew at an annual rate of 4.9%. During this period, faster than agreed expectations.
The strong data comes despite the Federal Reserve raising its slogan of longer interest rates, which failed to constrain the US consumer. The Fed’s next interest rate decision is scheduled for November 1
Other central banks began to change their monetary policy. On Thursday, the European Central Bank kept interest rates steady for the first time in more than a year after ten consecutive interest rate increases.
The European Central Bank said it would keep the deposit rate at a record high of 4%. The bank maintained its previous consistent policy guidance going forward.
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aFord and UAW reach tentative agreement
Ford (F) and the United Auto Workers (UAW) union reached a tentative labor agreement late Wednesday — a sign that the auto strike, now the longest in 25 years, may be coming to an end.
Ford shares were flat in early trading Thursday following the news.
like Yahoo Finance Pras Subramanian Reports:
UAW He said the initial agreement includes Increase base pay by 25% through April 2028 This will cumulatively raise the top wage by more than 30% to more than $40 per hour, and raise the starting wage by 68% to more than $28 per hour. Ford’s lowest-paid workers will see a raise of more than 150% over the life of the agreement, with some workers receiving an 85% raise immediately after ratification.
The UAW also unveiled the reinstatement of the COLA (Cost of Living Allowance) provisions, along with a new three-year pay progression measure (previously 8 years), as well as the end of pay levels. The union said it received gains for workers with pensions and 401K plans, but did not disclose precise details.
The deal is still subject to approval by the UAW’s National Ford Council, and ratification by a simple majority of the UAW’s 57,000 Ford workers.
Read more here.
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aStocks fall when the market opens
Stocks opened lower, with the Nasdaq Composite (^IXIC) the biggest loser in the early morning session, down about 0.5% in the wake of disappointing technology earnings. The Dow Jones Industrial Average (^DJI) fell 0.1% while the S&P 500 (^GSPC) fell about 0.4%.
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a
GDP: The US economy grows by 4.9% amid strong consumer spending
The US economy grew at its fastest pace in nearly two years over the past three months as consumers increased their spending despite the high interest rate environment.
As Yahoo Finance Josh Shafer Reports:
Bureau of Economic Analysis Advance estimate of US GDP for the third quarter The economy showed that it grew at an annual rate of 4.9% during the period, faster than consensus forecasts. Economists surveyed by Bloomberg estimated that the US economy grew at an annual rate of 4.5% during this period.
The reading was higher than the second quarter’s GDP, which was revised down to 2.1%.
The GDP release highlights the resilience of the US consumer despite persistent fears of a slowdown. But many economists see this as the limit of economic growth before credit tightening caused by interest rate hikes by the Federal Reserve and the recent rise in bond yields take a hold on business development and consumer spending.
Read more here.
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KStock futures point to a return to selling
Wall Street stocks were on pace Thursday to add to the steep losses suffered the previous day, as investors looked forward to new earnings releases.
Dow Jones Industrial Average (^DJI) futures fell 0.41%, or 136 points, while S&P 500 futures (^GSPC) fell 0.67%. Futures on the tech-heavy Nasdaq 100 (^NDX) fell 0.95%.
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