Stocks opened higher Thursday as S&P 500 attempted to break a five-day losing streak and Wall Street evaluated the likelihood of a recession ahead.
The S&P 500 climbed 0.4% while the Dow Jones Industrial Average bounced 130 points, or also about 0.4%. The technology-focused Nasdaq Composite advanced by the same margin.
Exxon rose 1% as the oil giant it lifted its buybacks, while Chevron gained on a higher capital spending budget. Tesla slumped amid reports of shortened shifts at its Shanghai factory.
“U.S. equity futures are trying to stabilize, and Treasuries are witnessing tiny profit taking, but the mood is still gloomy,” said Adam Crisafulli, founder of Vital Knowledge in a note to clients Thursday. “The problem for domestic stocks is the absence of catalysts – two inflation figures come Fri (PPI and Michigan expectations), but the real fireworks arrive next week.”
Investors’ attention has shifted toward next week’s Federal Reserve policy meeting, where the central bank is widely expected to issue a 50 basis point interest rate hike. It’s a smaller increase than the prior four rate hikes, but may do little to alleviate concerns over whether the Fed can avoid a recession next year in its attempt to squash surging prices. November’s consumer price index, due Tuesday, should also provide more clarity on the direction of inflation.
Attention also concentrated on the labor market, which continues to show resilience despite the Fed’s attempt to break it. Weekly jobless claims, meanwhile, showed a slight uptick from the previous week but fell in line with estimates.
Traders expect the most recent earnings results from Lululemon Athletica, DocuSign, Broadcom and Costco after the bell Thursday.
On Wednesday, the S&P 500 declined 0.19% in its fifth straight losing session. The Dow was virtually flat, adding just 1.58 points. Meanwhile, the Nasdaq Composite slipped 0.51%.
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