Dow jumps more than 550 points for best day since June as bond yields recede: Live updates – CNBC

U.S. stocks closed higher Thursday.

The Dow Jones Industrial Average added 564.5 points, or 1.7%.

The S&P 500 and Nasdaq Composite gained 1.89% and 1.78%, respectively.

— Hakyung Kim

Small cap semiconductor stocks are breaking further away from their megacap peers, according to Wolfe Research.

Senior analyst Rog Ginsberg wrote in a Wednesday note that semiconductor stocks are a pivotal barometer of overall market wellbeing. Small cap semis, he says, are already showing signs of breaking down.

“Now while it’s obviously the Mega Cap Semi names that are the real market movers, the breakdown within their small cap counterparts can’t go unnoticed,” Ginsberg said. “Unless this relationship is going to decouple, the deeply oversold condition in small caps needs to aggressively respond. Failure to do so would just provide an additional warning sign for the broader market.”

— Brian Evans

The majority of stocks in the 30-member Dow are on track for noteworthy gains so far this week, pushing the index more than 4% higher.

Goldman Sachs is leading 29 stocks in the blue-chip average higher compared with where they started the week, with the bank climbing more than 8%. Nike, Verizon and Boeing are also among the best performers on the week as each has added more than 7%.

More than half of stocks in the index have advanced more than 4% this week, all but two are up at least 1%. Merck is trading slightly above flat on the week, while Caterpillar has slipped 0.4%.

— Alex Harring

Shares of MoonLake Immunotherapeutics are up an eye-watering 354% so far this year, but Stifel analyst Alex Thompson says that investors who may have missed out needn’t despair.

Stifel initiated coverage of the stock at a buy rating and corresponding price target of $75, indicating 54% upside potential.

“While we’ve already missed out on the run this year (>350% vs. XBI -20%) following data in Hidradenitis suppurativa (HS) supporting a best-in-class IL-17 profile, we think there’s clear room for potential upside via derisking of additional indications and/or M&A,” Thompson wrote.

CNBC Pro subscribers can read the full story here.

— Lisa Kailai Han

The energy sector jumped 2.6% Thursday as oil prices gained more than $2 a barrel, or nearly $3, to break a three-day losing streak.

Targa Resources led the sector gains, rallying nearly 7%. ConocoPhillips and Hess were the subsequent winners, up 5.2% and 3.4% for the day, respectively.

Energy is on pace for week-to-date gains of nearly 3%.

— Hakyung Kim

Check out the companies making headlines in midday trading.

Starbucks — Shares jumped more than 10% after the company posted an earnings and revenue beat in the fiscal fourth quarter. Management also reported better-than-expected performance in China, its second-largest market.  

Roku — The streaming video platform rallied 25% after its latest quarterly announcement. The company’s third-quarter revenue and guidance for the fourth quarter came above analysts’ expectations. Roku reported $912 million in revenue, versus the $855 million Wall Street had forecasted, according to LSEG. 

SolarEdge — The solar stock dropped 7.5% a day after SolarEdge posted disappointing third-quarter results and slashed its outlook for the current quarter’s revenue. The company was downgraded on Thursday by multiple firms, including Truist, BMO Capital Markets and Guggenheim, on the back of its earnings.

The full list can be found here.

— Hakyung Kim

Analysts on Wall Street are cautious on Apple ahead of the tech giant’s its fiscal fourth-quarter report Thursday amid signs of softening demand.

The tech giant’s quarterly results come on the heels of several product launches. Apple released its long-awaited iPhone 15 product line with USB-C charging in September, as well as a new Apple Watch and updated AirPods. On Monday night, it held an unusual night-time launch event to announce its new PC chips, Macbook Pro laptops and iMac model.

The September quarter results will only encompass approximately a week of the iPhone 15 sales. Analysts will be keeping a close eye on the company’s current December-quarter guidance for insight on iPhone 15 sales.

To see what analysts are saying ahead of the announcement, click here.

— Hakyung Kim

Walgreens and Nike were top contributors to the Dow‘s rally on Thursday.

The Dow climbed more than 350 points, or 1.1%. Part of that upward momentum came from Walgreens and Nike shares, which advanced more than 4% and 3%, respectively.

To be sure, the lion’s share of the 30 stocks in the blue-chip average traded higher in the session. Travelers was the only stock down more than 1%. Merck, which slipped 0.3% in midday trading, was the only other Dow stock trading lower.

The post-earnings surge for Roku is powering a big rally for the Ark Innovation ETF (ARKK).

Cathie Wood’s flagship fund, which counts Roku as one of its top 5 holdings, was up 8% in midday trading. Top holdings Coinbase and Tesla were also rallying on Thursday.

This would be the fourth positive day in a row for ARKK, which is now up about 22% year to date.

— Jesse Pound

The stock rally was broad-based, with all 11 S&P 500 sectors trading in positive territory. Leading those gains were real estate and energy, up by 3% and 2%, respectively.

— Sarah Min

Roku shares surged 30% Thursday after the company posted a third-quarter revenue beat.

The streaming device company on Wednesday reported revenue of $912 million, greater than the $855.2 million expected by analysts polled by LSEG, formerly known as Refinitiv. It did post a wider-than-expected loss of $2.33 per share, more than the loss of $2.12 per share consensus estimate.

— Drew Richardson, Sarah Min

Apple shares advanced 2% on Thursday as investors readied for the technology giant’s earnings report due after the closing bell.

Beyond the Big Technology company’s earning, investors will also watch for quarterly reports from companies including Block, Booking Holdings, Coinbase, Dropbox, Expedia and Paramount Global.

Also among the bevy of companies posting earnings after the bell: Carvana, DraftKings, Live Nation, Sweetgreen and Yelp.

It’s shaping up to be a better earnings season than Wall Street expected more than three quarters of companies in the S&P 500 done reporting. Of those that have already posted results, about four out of every five have surpassed Wall Street expectations, according to FactSet.

— Alex Harring, Bree Doyle

The Cboe Volatility Index (VIX)— Wall Street’s preferred fear gauge — traded as low as 16.12 on Thursday, a level not seen in three weeks. This comes as stocks rallied for a second straight day on hope the Federal Reserve is done raising rates for the year.

The major averages opened in positive territory Thursday.

The Dow Jones Industrial Average advanced 213 points, or by 0.66%. The S&P 500 gained 0.96%, while the Nasdaq Composite jumped 1.22%.

— Sarah Min

Bearishness over the short-term outlook for stocks climbed to 50.3% in the latest weekly survey from the American Association of Individual Investors, the highest since last Christmas (Dec. 22, 2022) , up from 43.2% last week and far above the historical average of 31.0% for a seventh week.

Bullishness over the short-term outlook for stocks dropped to just 24.3% in the weekly poll, the weakest since mid-May, down from 29.3% last week and below the historical average of 37.5% for a third week.

That’s all good news for contrarian investors who believe declining bullishness means there’s cash on the sidelines that can come into the stock market, at the same time as rising bearishness means most of the selling is out of the way.

— Scott Schnipper

Yields on Treasurys kept sliding early Thursday, helping push U.S. stock index futures higher as debate raged over whether “risk on” trades will return.

Two-year Treasury notes yielded 4.954% and 10-year notes had fallen all the way 4.691% after briefly topping 5% two weeks ago. Bids in Treasurys come as the chance of another quarter point Federal Reserve rate increase at its Dec. 13 policy meeting crumbles — down to a less than 1 in 7 probability (14.6%), according to the CME FedWatch tool that uses interest rate futures prices.

S&P 500 index futures were recently 31 points higher at 4237, up about 0.7%, while Nasdaq-100 futures climbed 161 or 1.1% to 14,906.

As inflation weakens, “yields will probably drop further but settle at a much higher level than before the pandemic,” London-based Capital Economics wrote Thursday.

— Scott Schnipper

The Federal Reserve got some good news related to inflation Thursday morning with labor costs unexpectedly falling by 0.8% in the third quarter versus expectations for a 0.7% increase, according to economists polled by Dow Jones.

Weekly jobless claims came in slightly higher than expected, pointing to an economic slowdown the Fed wants. Jobless claims rose to 217,000 for the week, compared to the consensus economist estimate of 214,000, according to Dow Jones.

Treasury yields continued their slide lower as the numbers hit and stock futures extended their gains.

—John Melloy

Markets found enough in this week’s Federal Reserve meeting to suggest that there’s only a small chance of any additional interest rate hike.

The odds for a December increase fell Thursday morning to 14.6%, according the CME Group’s FedWatch Tool, which uses fed funds futures pricing to gauge probabilities. A month ago, the chances of a move in December were at 39%.

Futures pricing, which can be volatile and swing quickly, now indicates that the first rate cut could come as soon as May.

—Jeff Cox

Peloton shares dropped 6% in premarket trading Thursday after the connected fitness company reported a wider-than-expected quarterly loss and a tepid holiday forecast.

Peloton posted a loss of 44 cents per share, more than the per-share loss of 34 cents expected by analysts surveyed by LSEG, formerly known as Refinitiv. Revenue beat expectations, coming in at $595.5 million, more than the $591 million anticipated.

The company is forecasting revenue of between $715 million and $750 million in its holiday quarter, representing an 8% drop at the midpoint compared to the year-ago period. That falls short of the $763.2 million analysts had expected for the company’s fiscal second quarter, according to LSEG.

— Gabrielle Fonrouge, Sarah Min