Traders work on the floor of the New York Stock Exchange (NYSE) on the first trading day of 2024 on January 02, 2024 in New York City.
Spencer Platt | Getty Images
Stock futures flickered near the flatline Thursday night after the S&P 500 and the Dow Jones Industrial Average closed at new records, bolstered by enthusiasm over the Federal Reserve’s interest rate cut.
Futures tied to the S&P 500 inched lower by 0.12%. Dow futures hovered near the flatline, while Nasdaq 100 futures slipped 0.21%.
Shipping behemoth FedEx pulled back 10% in extended trading after the company slashed the top end of its full-year earnings outlook and trimmed its revenue guidance. Nike surged more than 9% after announcing that CEO John Donahoe will step down from his post on Oct. 13.
Stocks surged during Thursday’s regular session, with the S&P 500 rising 1.7% to close over the 5,700 level for the first time. The 30-stock Dow ended the day more than 500 points higher to post its first-ever close above 42,000. Both indexes also registered all-time highs during the day. The Nasdaq Composite advanced 2.5%.
Unemployment data, along with the Fed’s half-point rate cut on Wednesday, seemed to bolster investors’ sentiment. Initial jobless claims, which came in at 219,000 for the week of Sept. 14, were lower than expected and showed a decline from the prior week.
“The first economic data point since the ‘jumbo’ rate cut should please the Fed,” said Chris Larkin, managing director of trading and investing for E-Trade from Morgan Stanley. “Lower-than-expected jobless claims won’t raise any immediate concerns about the labor market slowing too much.”
The Fed’s Wednesday decision marked the first rate cut since 2020.
The three major averages are on pace for weekly gains, with the S&P 500 up nearly 1.6% through Thursday’s close. The Dow is toting a 1.5% jump on the week, while the Nasdaq is outperforming with a 1.9% advance.
It’s been a big week for small caps
The Russell 2000 surged 2.1% on Thursday, posting a seventh straight positive session.
It also marks the first seven-day win streak for the small-cap benchmark since March 2021.
The index is also on pace for a 3.2% gain on the week.
Russell 2000’s performance in the past five days
The Russell 2000’s hot streak comes as the Federal Reserve dialed back interest rates by a half point. Lower rates are generally a boon for small companies, which tend to take on floating rate debt and could thus see their financing costs come down.
—Darla Mercado, Chris Hayes
Energy is the big winning sector in the S&P 500 this week
The S&P 500 is on pace for a nearly 1.6% jump this week, and a reawakening in the energy sector is contributing to the gains.
As of Thursday, seven of the 11 sectors of the S&P 500 are positive on the week, with energy up more than 4%. Standouts in the sector include Baker Hughes, up 8.9% for the week, and SLB, which is on pace for a nearly 7% advance.
The turn higher for energy names comes as West Texas Intermediate futures wipe their 2024 losses, supported by rising tensions in the Middle East and the Federal Reserve’s rate cut. U.S. crude oil is up less than 1% in 2024, but it’s still down more than 11% for the quarter.
—Darla Mercado, Chris Hayes
Stocks making the biggest moves after hours
Check out some of the companies making headlines in extended trading:
- Nike — Shares soared 10%. The sneaker company announced that CEO John Donahoe would step down from the role on Oct. 13. Nike veteran Elliott Hill, who had been at the company for 32 years before retiring in 2020, will take the helm.
- FedEx — Shares of the shipping company pulled back 10%. FedEx trimmed the higher end of its full-year earnings outlook and cut its revenue guidance. Fiscal first-quarter results missed the mark as well. FedEx reported adjusted earnings per share of $3.60 on revenue of $21.58 billion, while analysts polled by LSEG were looking for $4.76 per share in earnings and $21.93 billion of revenue.
- MillerKnoll — The office furniture company slipped more than 2% after missing analysts’ estimates on the top and bottom lines in the fiscal first quarter. MillerKnoll reported adjusted earnings per share of 36 cents on revenue of $861.5 million. Analysts polled by FactSet forecast 40 cents per share on revenue of $889.4 million. The company also issued weak guidance for the current quarter.
Read the full list here.
— Brian Evans
Stock futures open little changed
Stock futures opened little changed on Thursday, following fresh record highs for the Dow Jones Industrial Average and the S&P 500.
Futures tied to the 30-stock Dow gained 14 points, or 0.03%. S&P 500 futures ticked down 0.05%, while Nasdaq 100 futures slipped 0.12%.
— Brian Evans
