- US equities snap three-day skid led by technology shares.
- Jobless Claims back the rally, Nasdaq has the scope to snap five-week downtrend.
- Receding fears in Gaza, downbeat Treasury yields add to the risk-on mood.
Thursday turns out to be a good day for Wall Street as the bulls returned after a three-day off. Receding fears of the Fed’s tapering joins the weaker-than-expected US Jobless Claims to back the optimists. Also on the positive side were geopolitical risk headlines emanating from the Middle East.
US Jobless Claims offered a much-needed upside push to the American equities with a 444K weekly print, taking down the four-week average to 504.75 versus 535.25K prior. Following the release, White House Press Secretary Jen Psaki mentioned that the trend is clear on the declining unemployment claims. It should, however, be noted that the Continuing Jobless Claims and Philadelphia Fed Manufacturing Survey couldn’t stop the bulls despite flashing downbeat figures.
Elsewhere, US President Joe Biden recently signalled that Israel will begin the peace process in Gaza within the next two hours while also believing to have a genuine opportunity to make progress.
Also positive for the sentiment was dividend declaration and share buyback authorization news from Home Depot as well as upbeat earnings from Applied Materials.
Amid these plays, US 10-year Treasury yields dropped 5.5 basis points to retest 1.62% level whereas technology shares were the biggest gainers, offering an overall positive day, the first in a week.
Apple and Microsoft were the biggest tech gainers providing a tailwind to Nasdaq, up 236 points or 1.77% to 13,535.74 by the end of Thursday’s North American session. Dow Jones Industrial Average (DJIA) and S&P 500 also followed the suit with 0.55% and 1.06% respective upside, to 34,084 and 4,159 in that order.
With the latest positive, US equity benchmarks are up for snapping the four-week downtrend and hence Friday’s preliminary activity numbers for May will be the key to follow.
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