Stocks were choppy to start Thursday, but gained speed in afternoon trading. While there was plenty for market participants to consider – including a fresh round of corporate earnings reports – most eyes were looking ahead to tonight's Apple (AAPL) earnings event and tomorrow's monthly jobs report.
After Wednesday's Fed-induced roller-coaster ride, the Dow Jones Industrial Average finished Thursday up 0.9% at 38,225 and the S&P 500 gained 0.9% to 5,064. The Nasdaq Composite outperformed, surging 1.5% to 15,840, thanks to Qualcomm's (QCOM) impressive earnings report.
In its fiscal second quarter, QCOM, which makes chips for smartphones, disclosed earnings of $2.44 per share on $9.4 billion in revenue. Analysts, meanwhile, anticipated earnings of $2.32 per share on $9.3 billion in sales. Results got a significant boost from Android sales in China, which were up 40% year-over-year. Qualcomm also reiterated the dividend hike it first announced in March.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
In the the earnings call, CEO Cristiano Amon said the company is creating an artificial intelligence (AI) ecosystem to commercialize generative AI applications across smartphones, PCs, automobiles and more.
"As AI expands rapidly from the cloud to devices, we are extremely well-positioned to capitalize on this growth opportunity, given our leadership position at the edge across technologies, including on-device AI," Amon added.
QCOM stock jumped 9.7% today, gaining $18 billion in market value along the way. This upside created a halo effect for fellow semiconductor stocks, including Micron Technology (MU, +2.4%) and Arm Holdings (ARM, +2.8%).
Peloton stock goes on wild ride after earnings, CEO exit
Elsewhere on the earnings calendar, fitness equipment maker Peloton Interactive (PTON) reported a wider-than-expected per-share loss in its first quarter, while revenue also missed estimates.
More notably, perhaps, was news that Barry McCarthy is stepping down as CEO, effective immediately, ending a troubled two-year tenure that saw shares lose 90% of their value. Peloton also said it will cut 15% of its global workforce to lower costs.
PTON stock was initially up on the news – jumping 18% at the opening bell – but quickly reversed course to end the day down 2.8%.
Apple stock climbs ahead of earnings
Drugmaker Moderna (MRNA, +12.7%) and Carvana (CVNA, +33.8%) were two notable post-earnings gainers, too. Still, it was Apple's fiscal Q2 results, released after Thursday's close, that Wall Street was most excited about.
Apple stock closed up 2.2% ahead of the release. Analysts, on average expect the iPhone maker to report earnings of $1.50 per share, down 1.3% year-over-year on revenue of $90 billion (-5% YoY).
"This anticipated drop follows the seasonal trend post-holiday quarter," say the folks at Toggle AI, an artificial intelligence market research firm. Attention is focused on slowing iPhone sales in China, while "investors are looking for updates on Apple's AI strategy and potential financial maneuvers, including a proposed $90 billion buyback and a 3% dividend hike," the researchers add.
April jobs report on deck
Another key event on investors' minds is tomorrow morning's release of the next jobs report. Economists are expecting the U.S. to have added 240,000 new jobs in April, down from the 303,000 added in March.
Brent Schutte, chief investment officer at Northwestern Mutual Wealth Management Company, will be watching the labor force participation rate and wage growth. "A rise in labor force participation could help ease the current elevated wage pressures," Schutte wrote in his weekly commentary. "However, if the participation rate holds steady or declines, wage pressures are more likely to persist."
During yesterday's press conference, Fed Chair Jerome Powell noted that inflation has come down significantly in the past year and the labor market has remained strong, which is good news. However, he also said that in order to bring inflation down to its 2% target, which is a prerequisite for rate cuts, wage growth is one thing that "will probably" need to slow.
Related content
- Kiplinger's Economic Calendar for This Week
- Philips CPAP Settlement: What to Know
- How the Biden Marijuana Shift Could Impact Taxes
-
Three Ways President Trump Could Impact the EconomyThe Letter Some of Trump's top priorities could boost economic growth, but others risk fueling inflation.
-
Average Health Care Costs by Age: Can You Afford It?Expect to pay more as you age. We've got solutions for how to cover these costs, which can exceed $1,000 per month in your 60s.
-
Will You Be Able to Afford Your Dream Retirement?You might need to save more than you think you do. Here are some expenses that might be larger than you expect, along with ways to ensure you save enough.
-
More SECURE 2.0 Retirement Enhancements Kick in This YearSaving for retirement gets a boost with these SECURE 2.0 Act provisions that are starting in 2025.
-
Saving for Your Emergency Fund: As Easy as 1-3-6An emergency fund that can cover six months' worth of expenses is far easier to build if you focus on smaller goals at first.
-
Stock Market Today: Dow Slides 697 Points on Super-Hot Jobs DataWhen the December nonfarm payrolls report hit the tape, there was no question which way stocks would go at Friday's opening bell.
-
Blowout December Jobs Report Puts Rate Cuts on Ice: What the Experts Are SayingJobs Report The strongest surge in hiring since March keeps the Fed on hold for now.
-
Constellation Energy Stock Soars on Its $26 Billion Buy. Here's Why Wall Street Likes the DealConstellation Energy is one of the best S&P 500 stocks Friday after the utility said it will buy Calpine in a cash-and-stock deal valued at $26 billion.
-
Why Walgreens Is the Best S&P 500 Stock After EarningsWalgreens stock is soaring Friday after the embattled pharmacy chain reported strong earnings and gave an upbeat outlook.
-
Delta Stock Remains a Strong Buy After EarningsDelta stock is soaring Friday after the air carrier beat earnings expectations and issued a strong outlook. Here's what investors need to know.
