Stocks rose on Thursday as investors weighed several key earnings reports and kept an eye on the bond market as Treasury yields continued to climb.
The Dow Jones Industrial Average added 308 points, or 1%. The S&P 500 and Nasdaq Composite rose 0.7% and 0.9%, respectively.
Several strong earnings reports supported the market, with AT&T and IBM rising 9% and 4.5%, respectively, after beating top and bottom line estimates for their most recent quarter.
On the downside, Tesla shares fell nearly 5% after the electric vehicle maker said Wednesday evening it expects to miss its 2022 delivery target. The company also posted quarterly earnings It missed analyst expectations.
Meanwhile, the benchmark 10-year Treasury yield hit a high of 4.18% on Thursday, briefly trading at levels not seen since 2008. It last traded near 4.17%. Rising rates have been a headwind for stocks all year as the Federal Reserve continues to try to ease inflationary pressures not seen in decades.
A surge in yields on Wednesday contributed to the end of a two-day winning streak for stocks, with the Nasdaq Composite falling 0.85%. The high-yield environment is one reason why many strategists are skeptical that the market will sustain a rally in the near term.
“Despite recent market volatility, the central bank’s tightening expectations have only increased inflation
Readings around the world continue to heat up. While still larger &
A few days ago, our intermediate-term bearish base case remains unchanged,” Wolff Research’s Chris Senyek said in a note to clients.
On the economic front, weekly jobless claims showed a surprise decline in early filings, but the Philadelphia Fed index showed a contracting manufacturing sector.