US close: Stocks surge as jobless claims data eases macro fears

US stocks bounced back strongly on Thursday as better-than-expected data from the labour market eased investors' concerns about an impending recession.

Nevertheless, markets still remains well below levels seen last week following the dramatic three-day sell-off between last Thursday and Monday that saw more than 2,000 points (-5.2%) wiped off the Dow Jones Industrial Average.

The Dow finished Thursday's session up 1.8% at 39,446.49, with just three of its 30 constituents registering losses. Meanwhile, the S&P 500 surged 2.3% to 5,319.31 and the Nasdaq jumped 2.9% to 16,660.02. For the S&P 500 in particular, this was the index's best daily gain since November 2022.

Labour market in focus

Thursday's primary focus was on this week's jobless claims report, which revealed Americans lined up for unemployment benefits at a decelerated pace in the week ended 3 August.

According to the Labor Department, initial jobless claims fell by 17,000 to 230,000, below market expectations for a print of 240,000, easing from their post-Covid peak but remaining significantly above this year's average. Continuing claims increased by 6,000 to 1.875m, while the four-week moving average, which aims to strip out week-to-week volatility, increased by 2,500 to 240,750.

Ryan Brandham, head of global capital markets for North America at Validus Risk Management, said the data "serves as an encouraging sign after last week’s very weak print. This improvement is likely to reassure markets, which are on edge after Monday’s large equity selloff and bond rally.

"However, the underlying trend in claims is still higher, which shows a softening US labor market and a generally slowing US economy. A soft landing is still in sight, although markets are at risk of overreacting and experiencing bouts of volatility, sometimes in both directions."

In other news, US wholesale inventories increased 0.2% to $903.0bn in June, according to the Census Bureau, in line with preliminary estimates and following a downwardly revised 0.5% increase in May. Non-durables inventories rose 0.7% in June, while durable goods stocks fell 0.1%.

Warner Bros Discovery hits record low

Shares in Warner Brothers Discovery plunged 9% to $7.02 after it revealed it had taken a massive $9.1bn non-cash impairment charge at its networks division as it prepares to part ways with the NBA. The entertainment company also missed estimates with its second-quarter results, pushing shares down briefly to $6.73 – a record low since the merger of WarnerMedia and Discovery Inc in April 2022

Online dating company Bumble tanked 29% after slashing its full-year revenue outlook amid growth fears, after second-quarter results missed expectations.

Eli Lilly jumped 9% after lifting its full-year revenue forecast by $3bn on the back of a strong second quarter, driven by the robust performance of its blockbuster weight loss and diabetes drugs Zepbound and Mounjaro.

Under Armour's stock rose by almost a fifth after the athletic apparel group posted quarterly earnings that beat on both the top and bottom lines.

Dow Jones - Risers

Salesforce.Com Inc. (CRM) $249.12 3.78%
Boeing Co. (BA) $168.87 3.45%
Amgen Inc. (AMGN) $324.69 3.43%
Caterpillar Inc. (CAT) $336.16 3.18%
International Business Machines Corporation (CDI) (IBM) $192.61 3.11%
Goldman Sachs Group Inc. (GS) $485.77 2.70%
Intel Corp. (INTC) $20.49 2.42%
Nike Inc. (NKE) $74.19 2.16%
American Express Co. (AXP) $233.54 2.07%
3M Co. (MMM) $125.13 1.87%

Dow Jones - Fallers

Microsoft Corp. (MSFT) $402.69 -1.50%
Walgreens Boots Alliance, Inc. (WBA) $10.86 -0.46%
Cisco Systems Inc. (CSCO) $45.83 -0.11%

S&P 500 - Risers

Under Armour Inc. Class A (UAA) $7.71 19.17%
Under Armour, Inc. (UA) $7.42 18.34%
Hanesbrands Inc. (HBI) $6.14 18.08%
Parker-Hannifin Corp. (PH) $568.08 10.84%
Eli Lilly and Company (LLY) $845.31 9.48%
CF Industries Holdings Inc. (CF) $79.53 8.50%
NRG Energy Inc. (NRG) $77.97 8.19%
Foot Locker Inc. (FL) $29.71 7.30%
Delta Airlines Inc. (DAL) $39.61 6.14%
Quanta Services Inc. (PWR) $262.98 5.75%

S&P 500 - Fallers

CenturyLink Inc. (LUMN) $5.38 -18.85%
Monster Beverage Corp (MNST) $45.01 -12.19%
McKesson Corp. (MCK) $547.51 -11.34%
Brighthouse Financial, Inc. (BHF) $42.16 -6.12%
TripAdvisor Inc. (TRIP) $14.03 -5.62%
Dollar Tree Inc (DLTR) $94.93 -3.27%
Akamai Technologies Inc. (AKAM) $91.57 -2.99%
Nvidia Corp. (NVDA) $104.97 -2.84%
Ipg Photonics Corp. (IPGP) $67.32 -2.66%
Zions Bancorporation (ZION) $46.17 -2.51%

Nasdaq 100 - Risers

American Airlines Group (AAL) $9.89 4.60%
Regeneron Pharmaceuticals Inc. (REGN) $1,113.35 4.01%
Expedia Group Inc. (EXPE) $117.97 3.57%
Amgen Inc. (AMGN) $324.69 3.43%
Baidu Inc. (BIDU) $86.54 3.32%
Intuitive Surgical Inc. (ISRG) $463.61 2.76%
Fiserv Inc. (FI) $160.15 2.52%
Intel Corp. (INTC) $20.49 2.42%
Idexx Laboratories Inc. (IDXX) $483.91 2.18%
Sirius XM Holdings Inc (SIRI) $3.15 2.11%

Nasdaq 100 - Fallers

Monster Beverage Corp (MNST) $45.01 -12.19%
Dollar Tree Inc (DLTR) $94.93 -3.27%
Nvidia Corp. (NVDA) $104.97 -2.84%
Broadcom Inc. (AVGO) $145.74 -1.83%
Paychex Inc. (PAYX) $124.37 -1.78%
Tesla Inc (TSLA) $198.84 -1.70%
Qurate Retail Inc. (QRTEA) $0.65 -1.58%
Microsoft Corp. (MSFT) $402.69 -1.50%
Workday, Inc. (WDAY) $212.18 -1.44%
Take-Two Interactive Software Inc. (TTWO) $138.78 -1.10%