U.S. stocks scrambled firmly higher Thursday as Wall Street looked to rebound from four consecutive days of declines for the S&P 500 (^GSPC).
A batch of economic data hit traders’ desks before markets opened Thursday. The government’s second estimate of fourth-quarter GDP was downwardly revised to 2.7% compared to 2.9% reported last month in the preliminary reading, reflecting weaker consumer spending and higher inflation figures in the final three months of 2022.
Meanwhile, filings for unemployment insurance fell last week to 192,000, the Labor Department said Thursday. Economists surveyed by Bloomberg expected jobless claims to come in at 200,000.
In individual stock moves, shares of NVIDIA Corporation (NVDA) rallied 12% after the chipmaker reported fourth quarter results late Wednesday that beat analyst estimates, even as gaming revenue nearly halved from last year. The company said it would partner with artificial-intelligence platforms amid a boom in interest for the technology, spurring optimism about its growth prospects.
Shares of Lucid Group (LCID) tanked nearly 13% after the electric vehicle maker’s fourth-quarter earnings missed estimates, while a drop in preorders for its Air sedan signaled waning demand for its cars.
Alibaba (BABA) shares jumped 3.5% after the Chinese e-commerce giant unveiled better-than-expected quarterly results, benefitting from easing COVID-19 restrictions in the final three months of 2022.
Shares of Etsy (ETSY) were down more than 3% even after the online crafts marketplace reported revenue for the fourth quarter that topped Wall Street estimates, citing a boost from solid holiday shopping demand.
Meanwhile in the bond market, U.S. Treasury yields resumed their ascent, with the benchmark 10-year note topping 3.95% early Thursday.
On Wednesday, investors received a readout of minutes from the Federal Reserve’s Jan. 31- Feb. 1 meeting that indicated officials were intent on proceeding with “ongoing increases” in interest rates to quell inflation. Investors are now expecting the federal funds rate to peak at 5.5%.
The majority of Federal Open Market Committee (FOMC) members supported this month’s smaller 25-basis-point hike, but a few participants indicated a desire to lift rates by a heftier 50 basis points.
In upcoming meetings, “the case for switching back to 50 basis points is weak, in our view,” Pantheon Macroeconomics Chief Economist Ian Shepherdson said in a note. “But if the early data for February — notably payrolls, retail sales, and the CPI — are not materially softer than in January, the compromise would be to forecast another couple of rate hikes beyond the December projections.”
“We think the Fed has already done enough and needs to wait for the full effect of its actions to work through,” Shepherdson said.
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc