The main US stock indices opened higher on Thursday (7th) as the market waited for the Chairman of the Federal Reserve (Fed) Powell to testify before the Senate later to make more comments on interest rate policy or economic prospects. Ball testified before the House of Representatives yesterday and maintained his previous argument that the central bank is in no rush to cut interest rates, but it may be appropriate to cut interest rates at some point this year.
As of press time, the Dow Jones Industrial Average rose more than 180 points or nearly 0.5%, the Nasdaq Composite Index rose more than 110 points or nearly 0.7%, the S&P 500 Index rose nearly 0.6%, and the Philadelphia Semiconductor Index rose almost 2.0%.
Wall Street traders held back on making big bets ahead of Fed Chairman Jerome Powell’s testimony before Congress and Friday’s jobs data. In addition, the euro fell as the European Central Bank (ECB) kept interest rates steady and lowered its inflation forecasts.
S&P 500 contracts suggest the index will extend its rally above 5,100. The yield on 10-year US government bonds fell 3 basis points to 4.07%; the euro depreciated by 0.2% and German government bonds continued to rise. Speculation that the Bank of Japan (BOJ) will raise interest rates this month for the first time since 2007 has increased after a series of reports and wages data pushed the Yen higher.
The number of people claiming unemployment benefits in the United States last week remained at a record low of 217,000, highlighting that the strong jobs market has not abated. On the other hand, the number of people still receiving unemployment benefits rose steadily to 1.906 million last week, above market expectations and the previous value, indicating that people are taking longer to find new jobs. This is the clearest sign that the job market has lost some of its energy.
Thomas Simons, US analyst at Jefferies, said: “Data since the end of October shows a significant increase in the number of people continuing to apply for unemployment benefits, suggesting some friction in the job market as unemployed people find it increasingly difficult to find new jobs.”
In other news, gold, a safe-haven asset, has risen for two consecutive months amid ongoing conflicts in Ukraine and Gaza, the upcoming US presidential election, and uncertainty over interest rates and inflation. However, Doug Boneparth, a certified financial planner and founder and president of Bone Fide Wealth in New York, said that despite the short-term rebound in gold prices, gold’s average annual return is far behind stocks and bonds.
From 22:00 Taipei time on Thursday (7th): Stocks in focus:
NVDA-USA shares rose 1.28% in early trading to $897.80 a share
Two Huida directors recently sold around US$180 million worth of company stock, joining the ranks of insiders taking advantage of the situation as stock prices continue to hit record highs. According to the announcement, Tench Coxe, who has served on Huida’s board of directors since 1993, sold 200,000 shares on March 5 at prices ranging from $850.03 to $852.50 per share. Coxe, a former managing director of venture capital firm Sutter Hill Ventures, still holds more than 3.7 million shares of Huida.
Shares of Intel (INTC-US) rose 3.47% in early trading to $46.05 a share
The US government is preparing to allocate $3.5 billion to Intel to allow the chip giant to produce advanced semiconductors for military and intelligence projects, according to US congressional sources. The funding, which was added to a fast-track spending bill passed by the US House of Representatives on Wednesday, would give Intel a dominant position in the lucrative defense market. The funding, which will last three years for the “Secure Enclave” program, comes from a broader $39 billion in funding from the Chip and Science Act.
Shares of Community Bank of New York (NYCB-US) rose 13.02% to $3.91 a share in early trading
Community Bank of New York disclosed Thursday that it holds $77.2 billion in deposits, down about 7% from $83 billion on Feb. 5, sending its shares down 3.3% in premarket trading. The bank also said its strategic measures this year include reducing commercial real estate risks.
Today’s key economic data:
- US Challenger reported 84,638 layoffs in February, compared to 82,307 previously
- The annual growth rate of Challenger layoffs in the United States in February was 8.8%, compared to the previous value of 7.92%.
- The US trade balance reported in January – $ 67.4 billion, – $ 63.4 billion, compared to the previous value of – $ 64.2 billion.
- The number of people who claimed unemployment benefits in the US last week was 217,000, which was expected to be 217,000, and the previous value was 217,000
- The number of people who continued to receive unemployment benefits in the United States last week was 1.906 million, 1.889 million, and the previous value was 1.898 million.
Wall Street Analysis:
Tom Essaye, founder of The Sevens Report, said: “Fed Chairman Ball’s testimony before Congress did not significantly change current policy expectations. Ball largely repeated the Fed’s consistent message: interest rates have peaked and will be lowered , but it won’t happen anytime soon because the central bank needs more evidence that inflation will reach 2%.”
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