Inventory market at the moment: Dow ekes out once more to finish longest dropping streak since 1974

Investing.com– The Dow eked out a achieve Thursday, snapping its longest dropping streak since 1974, even because the post-Federal Reserve rebound ran out of steam..

At 4:00 p.m. ET (21:00 GMT), the Dow Jones Industrial Common achieve 15 factors, or 0.04%, the S&P 500 index fell 0.1%, and the NASDAQ Composite fell 0.1.

US GDP exhibits wholesome development

The US economic system grew sooner than beforehand estimated within the third quarter, pushed by strong shopper spending, based on information launched earlier Thursday.

Gross home product elevated at an upwardly revised 3.1% annualized fee, having been beforehand reported to have expanded at a 2.8% tempo final quarter.

The economic system grew at a 3.0% tempo within the April-June quarter, and is increasing at a tempo that’s properly above what Federal Reserve officers regard because the non-inflationary development fee of round 1.8%.

This information performs into the concept the Federal Reserve might be gradual to chop rates of interest additional subsequent yr.

Fed sees solely two extra cuts in 2025

The US central financial institution reduce rates of interest by 25 foundation factors on Wednesday, as broadly anticipated, but in addition the policymakers additionally indicated that they see simply two extra 25 bps fee cuts subsequent yr, in contrast with a previous forecast in September for 4 cuts.

The Federal Open Market Committee (FOMC) financial projections confirmed that inflation was nonetheless a great distance from its 2% goal, with the focused metric anticipated to finish this yr at 2.4% and at 2.5% subsequent yr.

“I feel buyers jas realized, because the Fed did within the final couple months, that inflation was ticking up somewhat bit, and that and that the rate of interest forecast of the Fed from September was in all probability not going to be correct.

The prospect of rates of interest remaining larger for longer than anticipated despatched Wall Road indexes sharply decrease on Wednesday, with heavy losses within the expertise sector.

The blue chip DJIA slumped over 1,000 factors, or 2.6%, its tenth consecutive decrease session, marking its longest dropping streak since 1974, whereas the S&P

500 dropped nearly 3% and the Nasdaq Composite slipped 3.6%, its worst day since late July.

Micron slumps after weak steerage

Micron Know-how (NASDAQ:MU) shares plunged 16% after the corporate issued weaker-than-expected second-quarter steerage, dragging the broader chip sector decrease. 

However the broader tech sector continued to tack on positive factors, led by NVIDIA Company (NASDAQ:NVDA) as buyers stay assured that the AI-led rally is ready to proceed. 

“I feel AI particularly, is secular, not cyclical, so it’ll develop within the subsequent a number of years, nearly no matter what occurs to the economic system,” Chief Strategist and Portfolio Supervisor Rhys Williams stated in an interview on Thursday. “You wish to be aligned with these sort of firms within the inventory market, as a result of I feel that is the place the continued positive factors are going to be.”

Elsewhere, Darden Eating places (NYSE:DRI) inventory gained over 14% after the restaurant operator posted fiscal second-quarter outcomes forward of expectations, with gross sales rising 6%, whereas including upbeat steerage.

CarMax (NYSE:KMX) inventory rose 3% after the used automotive retailer reported third-quarter earnings and income that topped analyst expectations, pushed by will increase in unit gross sales and robust margins.

Lamb Weston Holdings Inc (NYSE:LW) fell 20% after changing its chief govt and slicing its 2025 earnings outlook following quarterly outcomes that fell in need of estimates.

(Peter Nurse, Ayushman Ojha contributed to this text.)