U.S. Stocks Drift as Wall Street Cools Following Record Highs
NEW YORK (AP) — The momentum on Wall Street is cooling as U.S. stocks drift on Thursday following the latest record-setting day.
The S&P 500 was edging down by 0.1% in morning trading after setting an all-time high for the 25th time this year. The Dow Jones Industrial Average was up 176 points, or 0.5%, while the Nasdaq composite was down 0.3% after hitting its own record.
Big Lots tumbled 19.5% after reporting a larger loss for the latest quarter than expected, citing a decrease in sales as customers pull back on spending, particularly on non-essential items.
Another retailer, Five Below, also disappointed with lower-than-expected profit and revenue, attributing struggles to its core lower-income customers. This highlights the growing divide between lower and higher-income consumers, with inflation hitting lower-income households harder.
A report showed a potential softening in the job market as more U.S. workers applied for unemployment benefits last week. This could signal a slowdown that Wall Street is hoping for, as it may lead to interest rate cuts by the Federal Reserve to combat inflation.
In a separate report, U.S. worker productivity was not as strong as expected in the first quarter, which could impact wage growth and inflation.
Despite the economic reports, Treasury yields remained steady, with the 10-year Treasury yield at 4.29% and the two-year yield at 4.73%.
Lululemon Athletica and J.M. Smucker saw gains after reporting better-than-expected profits, while Robinhood Markets rose after announcing the acquisition of Bitstamp, a cryptocurrency exchange.
Nvidia slipped after reaching a total value of $3 trillion, and all eyes are on the upcoming U.S. government job market update on Friday.
The European Central Bank cut its interest rates, following a trend seen in other parts of the world. Stock indexes in Europe rose modestly, while Asian markets were mixed.
Overall, the market is cautiously optimistic, with hopes for a Fed interest rate cut later this year to support economic growth.