Stock market today: Wall Street holds near record levels, with S&P 500 on precipice of 5,000

Feb 8, 2024

NEW YORK (AP) — U.S. stocks are holding near record levels Thursday as evidence keeps piling up to show the job market remains remarkably solid.

The S&P 500 was virtually unchanged in early trading, a day after coming within a fraction of a point of the 5,000 level for the first time. The Dow Jones Industrial Average was up 24 points, or 0.1%, as of 9:40 a.m. Eastern time, and the Nasdaq composite was flat.

The U.S. economy has blown past earlier expectations for a recession, and the latest show of strength came from a report indicating fewer workers applied for unemployment benefits last week than expected. The number remains low relative to history, even if layoffs at Google’s parent company, Macy’s and other big-name companies have been getting attention recently.

In prior months, such a report may have hurt the stock market because of concerns that it would mean a longer wait for cuts to interest rates from the Federal Reserve. But investors have been coming around to the idea that good news on the economy is good for stocks because it will drive profits for companies, and futures tied to the S&P 500 rose after the report.

The latest set of earnings reports from big U.S. companies were also keeping the stock market mixed overall.

The Walt Disney Co. jumped 8.9% after it reported stronger profit for the latest quarter than analysts expected. It benefited from cost cuts and growth at its theme parks.

Ralph Lauren was another winner, rising 10.2% after its profit and revenue topped Wall Street’s forecasts. It said it saw strong holiday sales around the world, led by Asia.

U.S.-listed shares of Arm Holdings, a U.K.-based semiconductor company, soared 38.3% after it also topped analysts’ expectations.

Helping to offset those gains was PayPal, which slumped 9.3% even though it reported stronger profit than expected. It gave a forecast for expected profit across 2024 that fell short of analysts’.

S&P Global was another one of the heaviest weights on the S&P 500 and fell 8% after reporting weaker profit for the latest quarter than analysts expected.

New York Community Bancorp also fell 8.3% in its latest sharp swing since it shocked investors across the banking industry with a surprise loss last week. Its stock has dropped roughly 60% since then, and Moody’s earlier this week cut its credit-rating to “junk” status.

Analysts have said its problems are specific to it, particularly as it absorbs the purchase of much of Signature Bank, which was one of the banks that fell in last year’s mini-crisis for the industry. But worries remain high about a problem that’s affecting banks worldwide: weakness in commercial real estate.

Stocks of other regional banks have also been swinging sharply lately, forcing uncomfortable memories of last year’s banking crisis. The KBW Nasdaq Regional Banking index slipped 0.8%.

In the bond market, the yield on the 10-year Treasury ticked up to 4.14% from 4.12% late Wednesday.

Traders have taken heed of warnings from the Federal Reserve that its first cut to rates following years of rapid hikes won’t come soon. They’re betting on less than a 17% probability that it will arrive in March, down from nearly 63% a month ago, according to data from CME Group.

In stock markets abroad, indexes rose across much of Asia and Europe.

Stocks rose 1.3% in Shanghai after China replaced its top stock market regulator late Wednesday with a former banker nicknamed the “broker butcher,” analysts say, due to his record for cracking down on market abuses such as insider trading. Stocks fell 1.3% in Hong Kong, though.

Beijing has been struggling to prop up what have been some of the world’s worst-performing markets this year.

AP Business Writers Elaine Kurtenbach and Matt Ott contributed.

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