Wall Street’s main stock indexes closed higher on Tuesday, boosted by gains in Tesla (NASDAQ: TSLA) and mega-cap growth stocks, but volumes were thin ahead of the July Fourth holiday and the closely watched release of June nonfarm payrolls on Friday.
The U.S. Job Openings and Labor Turnover Survey, or JOLTS, showed job openings increased in May after posting outsized declines in the prior two months, but layoffs picked up amid slowing economic activity.
The data is the first in this week’s series of U.S. job reports, particularly Friday’s release of June nonfarm payrolls, which will be crucial in assessing whether the U.S. labor market remains resilient against the backdrop of decades-high interest rates.
The Dow Jones Industrial Average rose 162.33 points, or 0.41%, to close at 39,331.85, the S&P 500 gained 33.92 points, or 0.62%, to 5,509.01 and the Nasdaq Composite gained 149.46 points, or 0.84%, to 18,028.76.
Tesla surged to its highest level since the start of January after the EV maker reported a smaller-than-expected 5% drop in vehicle deliveries in the second quarter.
Megacap stocks such as Apple rose 1.6%, while Amazon.com and Alphabet also climbed, with U.S. Treasury yields slipping across the board.
U.S. Federal Reserve Chairman Jerome Powell told a panel that recent economic data represented “significant progress,” though he noted that the Fed needed to see more before changing policy.
“What the Fed really wants to see is a further click up in unemployment and then a slowdown with regards to new job creation,” said Genter Capital Management CEO Dan Genter, who added that the recent moderation in inflation could be a green light for the Fed to start considering rate cuts.
AI chip leader Nvidia dropped 1.3%, with the trend in other chip stocks largely mixed. Nvidia is up more than 147% year-to-date.
Investors are divided over the sustainability of the market rally in which the S&P 500 index has risen 14.75% in the first half of the year.
“We see an additional 10% before year-end, which is kind of frightening because if we’re at 5500 or so (on the S&P 500), 10% on that means we really have to see earnings justify that type of multiple,” said John Lynch, chief investment officer of Comerica Wealth Management.
Volume on U.S. exchanges was 9.89 billion shares, compared with the 11.8 billion average for the full session over the last 20 trading days.
Trading volumes are expected to be light throughout the week, with the equity market closing early on Wednesday and shut all day Thursday for U.S. Independence Day.
The U.S. listing of Novo Nordisk fell almost 1.7% after U.S. President Joe Biden and Senator Bernie Sanders called on the Danish drugmaker to cut prices of its Ozempic and Wegovy drugs. Rival Eli Lilly also dropped.
Paramount Global climbed 5.7% after news that billionaire Barry Diller’s digital media conglomerate IAC was exploring a bid to take control of the media giant.
Advancing issues outnumbered decliners by a 2.06-to-1 ratio on the NYSE. There were 179 new highs and 97 new lows on the NYSE.
The S&P 500 posted 15 new 52-week highs and 4 new lows, while the Nasdaq Composite recorded 39 new highs and 196 new lows.
(Source: ReutersReuters)
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