Wall Street's main indexes closed higher on Thursday after the latest inflation data reinforced expectations for a 25-basis point rate cut by the Federal Reserve, while Moderna's weak revenue forecast made it the S&P 500's biggest percentage loser.
Market Snapshot
The Dow Jones Industrial Average rose 235.06 points, or 0.58%, to 41,096.77, the S&P 500 gained 41.63 points, or 0.75%, to 5,595.76 and the Nasdaq Composite gained 174.15 points, or 1.00%, to 17,569.68.
Market Movers
Nvidia - Nvidia rose 1.9% after jumping 8% on Wednesday, the stock’s fourth-best percentage gain this year. CEO Jensen Huang on Wednesday discussed the rollout of the company’s new Blackwell chip and its customers’ return on investment. He said demand was so “great that delivery of our components and our technology and software is really emotional for people.”
Moderna - Moderna said it plans to cut research-and-development spending by 20% beginning in 2025, pausing a number of drug programs and discontinuing others. The vaccine maker said the cuts would bring it to break-even on an operating cash cost basis in 2028, two years later than the break-even date of 2026 that Moderna had set last November. Shares fell 12.4%.
Micron Technology - Micron Technology declined 3.8% to $87.21 after BNP Paribas downgraded shares of the chip companyto Underperform from Outperform, and slashed the price target to $67 from $140. The analysts said Micron will underperform compared with fellow makers of artificial-intelligence semiconductors through 2025.
Kroger - Grocery chain Kroger gained 7.2% after beating second-quarter earnings expectations as customer visits increased.
Roku - Roku jumped 5.7% to $74.13 after it was upgraded to Outperform from Peer Perform at Wolfe Research.
Warner Bros. Discovery - Warner Bros. Discovery jumped 10.4% after renewing its distribution deal with Charter Communications ahead of schedule. The media company stock was the top performer in the S&P 500 on Thursday.
Delta Air Lines - Delta Air Lines was flat after saying it expects third-quarter earnings at the high end of its initial guidance excluding an impact of 45 cents a share from an IT outage in July.
Boeing - Boeing rose 0.9% ahead of a vote Thursday by the aerospace company’s workers on a new labor agreement that could boost average pay by roughly one third over four years. Passage of the deal isn’t assured. Boeing and the International Association of Machinists and Aerospace Workers announced a tentative agreement on a new four-year labor deal Sunday.
Signet Jewelers - Signet Jewelers rose 11.3% after toppingfiscal second-quarter earningsexpectations, and saying same-store sales in the current third quarter have turned positive.
Market News
US Weekly Jobless Claims Modestly up
The number of Americans filing new applications for unemployment benefits increased marginally last week, suggesting that layoffs remained low even as the labor market is slowing.
Other data from the Labor Department on Thursday showed producer prices rising slightly more than expected in August amid a rebound in the cost of services. The combination of a fairly stable labor market and still-high inflation further diminished the chances of the Federal Reserve cutting interest rates by 50 basis points next Wednesday, when the U.S. central bank is expected to start its long-awaited easing cycle.
The reports followed data this month showing the unemployment rate retreated in August from a near three-year high touched in July and underlying inflation indicating some stickiness last month. Financial markets have slashed the odds of a half-point rate reduction to less than 15%.
ECB Cuts Interest Rates as Growth Dwindles
The European Central Bank cut interest rates again on Thursday and signalled a "declining path" for borrowing costs in the months ahead as inflation slows and economic growth in the euro zone falters.
The ECB lowered its deposit rate by 25 basis points to 3.50%, following up on a similar cut in June as inflation is now within striking distance of its 2% target and the domestic economy is skirting a recession.
The move had been widely telegraphed and investor attention has already shifted to what comes next and how ECB decisions will be shaped by the U.S. Federal Reserve's expected start to its own rate cuts next week.