Wall St ends sharply for 2nd day;  Amazon, Apple jump after hours

Wall St ends sharply for 2nd day; Amazon, Apple jump after hours

  • US economy contracts in the second quarter
  • Meta Platforms revenues fall for the first time
  • Ford shares rise after results
  • Indices: Dow up 1%, S&P 500 up 1.2%, Nasdaq up 1.1%

NEW YORK, July 28 (Reuters) – U.S. stocks rose for a second day on Thursday, with all three major indexes ending up more than 1% as data showing a second straight quarterly contraction in the economy fueled investor speculation that the Federal The Reserve may not need to be as aggressive with rate hikes as some had feared.

Yields on the benchmark 10-year Treasury note retreated after the data, while utilities (.SPLRCU) and real estate (.SPLRCR) — both of which tend to rise when yields fall — were the day’s best-performing S&P 500 sectors.

The decline in yields may indicate “that markets believe the Fed will have to pivot and move interest rates lower at some point, perhaps in the next 12-month period,” said Mona Mahajan, senior investment strategist at Edward Jones.

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“This means that the rate of tightening will be more gradual going forward.”

In addition, the second-quarter earnings growth forecast increased this week as several S&P 500 companies reported results that beat analysts’ expectations. Among them, Ford Motor Co ( FN ) shares rose 6.1% after it reported better-than-expected quarterly net income. read more

After the closing bell, Amazon.com shares rose more than 12% as the online retailer reported quarterly sales that beat Wall Street estimates. Amazon.com ended the regular session up 1.1%. read more Shares of Apple ( AAPL.O ) rose more than 3% after hours following the company’s quarterly report and positive forecast, and S&P 500 e-mini futures rose 2% late. read more

Earlier in the day, the US Commerce Department said the US economy unexpectedly contracted in the second quarter – the second consecutive quarterly decline in gross domestic product (GDP) reported by the government. read more

The news raised the possibility that the economy was on the brink of a recession, and some investors said it could deter the Fed from continuing to aggressively raise interest rates as it battles high inflation.

The Dow Jones Industrial Average (.DJI) rose 332.04 points, or 1.03%, to 32,529.63 the S&P 500 (.SPX) gained 48.82 points, or 1.21%, to 4,072.43 and the Nasdaq Composite added 7.01 IC. %, to 12,162.59.

The Nasdaq posted its biggest two-day percentage gain since May 27.

Stocks had risen in the previous session when the Fed raised interest rates and comments from Fed Chairman Jerome Powell eased some concerns about the pace of rate hikes. read more

“More investors are getting in now because they think at least there aren’t going to be any big surprises over the summer,” said Alan Lancz, president of Alan B. Lancz & Associates Inc., an investment advisory firm based in Toledo, Ohio.

On Wednesday, the Fed raised the benchmark interest rate overnight by three-quarters of a percentage point. The move followed a 75 basis point increase last month and smaller moves in May and March, in an effort by the US central bank to curb rising inflation.

Investors have expressed concern that inflation and aggressive Fed rate hikes could at some point tip the economy into recession. read more

Among falling stocks, Facebook and Instagram parent Meta Platforms Inc ( META.O ) fell 5.2% after it posted its first ever quarterly drop in revenue. read more

Volume on US exchanges was 11.21 billion shares, compared to the average of 10.86 billion shares for the full session over the past 20 trading days.

Advances outnumbered decliners on the NYSE by a ratio of 3.56 to 1; on the Nasdaq, a ratio of 1.66 to 1 favored advances.

The S&P 500 posted three new 52-week highs and 31 new lows; The Nasdaq Composite recorded 67 new highs and 97 new lows.

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Reporting by Caroline Valetkevitch; Editing by Jonathan Oatis

Our standards: Thomson Reuters Trust Principles.

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