The Wall indices closed with gains, led by corporate results and… ECB

Wall Street’s main stock indexes ended Thursday’s session with gains, with the technology index recording the biggest gain, boosted by a “jump” in Tesla shares, as investors eyeing corporate results continue to take a “breather” from the strong downward trend that has prevailed so far in 2022.

On the board, the industrialist Dow Jones recorded an increase of 162.06 points, or 0.51%, to 32,036.90 points, with the broadest S&P 500 to gain 38.60 points or 0.97%, at 3,998.50 points and the technological Nasdaq to record an increase of 161.96 points or 1.36%, to 12,059.61 points.

Investors continued to turn to the technology sector, which has fueled this week’s rally, as some strong corporate results led Wall Street to seek out some assets that have been battered in the past.

“What we saw in the market today is a continuation of a possible recovery, a possible optimism that the economic data is not as bad as investors feared it would be,” said Robert Cantwell, portfolio manager at Upholdings. “But this has been happening in the market for about a month now.”

The consumer discretionary sector led gains within the S&P 500, up more than 2%, helped by Tesla’s performance. The latter gained 9.8% after the automaker announced stronger-than-expected results, but showed a decline in the company’s gross margins. Compared to the beginning of the year, however, it still registers a 23% drop.

On the other side of the Atlantic, the European Central Bank raised its key interest rates earlier on Thursday for the first time in 11 years, in order to combat galloping inflation in the euro area. Its key interest rate rose by 50 basis points to 0% (from -0.5%), which sent the dollar lower against the single European currency.

A weaker dollar can boost tech stocks.

“The bulls seem to be back in the market. We’ve seen particularly strong rallies in technology, cryptocurrencies and other high-risk assets over the past few days,” notes Callie Cox, US investment analyst at eToro. “Which is worthy of our attention, as in an economy with striking weaknesses at this time, one would expect to see other parts of the market doing better. However, the animal instincts have returned, at least for the time being,” he added.

About 18% of S&P 500 companies have reported second-quarter results, with 71% of them beating expectations, according to FactSet.

“If general financial conditions continue to tighten at the current rate, this means that the long-term fair value of US equities will eventually continue to decline,” said Huw Roberts, head of analysis at Quant Insight.

AT&T stock fell 7.6% after revising its full-year free cash flow guidance on hand. Even so, however, the telco’s second-quarter results beat expectations.

American Airlines saw its stock lose 7.4% as it cut growth plans, despite its results meeting expectations. And United Airlines disappointed in terms of its results, with its share losses closing at 10.2%.

Carnival stock fell 11.2% after the company announced it would proceed with a $1 billion public offering of common stock.

Among the 30 Dow stocks, 21 moved with a positive sign and 9 with a negative sign. The gains were led by those of Boeing, Goldman Sachs, Salesforcewhile those of Verizon, Dow Inc., IBM.

US: Claims for new jobless benefits hit eight-month high

Initial claims for US jobless benefits rose by 7,000 last week.

According to official figures, the total number of initial applications reached 251,000.

This number is the highest since last November.

Economists polled by the Wall Street Journal had expected new claims to fall to 240,000 from 244,000 last week.

The number of people already collecting unemployment benefits rose by 51,000 to 1.38 million.

Claims have risen since reaching 166,000 in March, the lowest level of claims since 1968. Economists say the labor market remains strong, but layoffs must be watched.