THE GIST (“THE WHAT”)
Markets continue to closely monitor the ongoing debt ceiling negotiations as the deadline approaches near, the S&P 500 index extended Wednesday’s gains to notch its highest level since August 2022 on hopes that a deal to avoid a catastrophic default could be reached by next week. The index broke out of the tight range it was stuck into over the last 2 weeks to close near day’s highs at 4198.06, up modestly by 39.28 points (+0.94%).
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Markets Celebrating the Obvious?! – Traders’ A.I. (tradersai.com)
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THE DETAILS (The “How & Why”):
The index extended its previous session’s gains after President Biden assured that a deal to avoid a dangerous default could soon be reached by next week.
Meanwhile, yields rose for the fifth straight day after the weekly jobless claims data suggested a resilient labor market, falling to its lowest level since March. Large mega-cap stocks continue to lead the broader markets higher amid a rotation out of defensive sectors and into technology and consumer discretionary sectors.
Apple, Nvidia, Netflix, Microsoft and Alphabet all hit their fresh 52-week highs. Micron Technology also jumped more than 4% on news that the Japanese government will provide close to $1.5 billion in incentive to the chip producer to build a next-generation DRAM production plant in Hiroshima.
Netflix soared 9% on reporting stronger-than-expected subscriber growth in its newly launched ad-supported cheaper streaming service. On the earnings front, Take-Two Interactive Software and Bath & Body Works were sharply higher on better-than-expected results, up more than 10% each. Walmart Inc also jumped 1.30% on beating estimates in both its grocery and online business but sent Target down 4.21% on comparatively sluggish quarterly performance.