The U.S. stock market is holding near its records on Thursday following mixed reports from companies. Dollar General and Spam-maker Hormel are climbing to some of the market’s biggest gains, while Kroger is falling.
The S&P 500 slipped 0.1% but remains only 0.7% below its all-time high, continuing a relatively calm run following weeks of sharp swings. The Dow Jones Industrial Average was down 35 points, or 0.1%, as of 10 a.m. Eastern time, and the Nasdaq composite was 0.2% lower.
Dollar General rallied 8.8% after reporting a stronger profit for the latest quarter than analysts expected, as more customers shopped at its stores. It was also able to squeeze more profit out of each $1 in sales that it made.
Hormel climbed 3.9% after likewise reporting a better profit than expected, thanks in part to strength for its Planters nuts and Jennie-O turkey offerings. It also gave a forecasted range for profit in the upcoming year whose midpoint was above analysts’ forecasts.
Salesforce, meanwhile, helped keep the market in check. It delivered a better profit for the latest quarter than analysts expected, but its revenue fell just short, and its stock drifted between modest gains and losses. It was most recently up 0.4%.
CEO Marc Benioff extolled how Salesforce is “uniquely positioned for this new era” of artificial-intelligence technology, even if worries continue that all the world’s spending on AI may not end up worth it.
Besides such worries about potential overinvestment in AI, concerns about what the Federal Reserve will do with interest rates had sent U.S. stocks on sharp swings since it set its all-time high in late October.
After some back and forth, the general expectation on Wall Street is now that the Fed will indeed cut its main interest rate next week in hopes of shoring up the slowing job market. If it does, that would be the third such cut this year.
Investors love lower interest rates because they boost prices for investments and can juice the economy. The downside is that they can worsen inflation, which remains above the Fed’s 2% target.
But Treasury yields rose on Thursday following another rise for Japanese government bonds. Expectations for a coming Fed cut to rates also took a very slight hit after reports suggested the U.S. job market may be a bit better than expected.
One report said fewer U.S. workers filed for unemployment last week. The number was the lowest in more than three years.
A separate report said that the number of layoffs announced last month fell by more than half from October’s surge, according to outplacement and executive coaching firm Challenger, Gray & Christmas.
While such reports are of course good news for U.S. workers, they could also indicate the job market might not need as much help from lower interest rates.
The yield on the 10-year Treasury rose to 4.08% from 4.06% late Wednesday. While the move was modest, increases in yields can discourage some buyers from buying stocks and other investments instead of bonds.
Among the stocks falling on Wall Street was Kroger, which dropped 5.8%. The grocer reported weaker revenue for the latest quarter than analysts expected, though its profit beat forecasts. It also lowered the top end of its forecasted range for an important measure of revenue this year, while raising the bottom end by less.
Snowflake sank 9.7% despite topping analysts’ expectations for profit and revenue in the latest quarter. Analysts at UBS said the company’s stock may be feeling a letdown after excitement had grown so much after it blew past expectations in the quarter just before. Growth in product revenue also decelerated a bit in the latest quarter.
In stock markets abroad, indexes rose modestly in Europe following a mixed finish in Asia.
Japan’s Nikkei 225 index jumped 2.3%, while South Korea’s Kospi slipped 0.2%.
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