Stocks stop falling as Apple rises ahead of gains: Markets close

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(Bloomberg) — The world’s biggest technology companies led a rally in U.S. stocks ahead of gains from Apple Inc., with Wall Street also gearing up for Friday’s jobs report.

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Stocks ended a two-day decline. Nvidia Corp. led to gains among chipmakers and Apple climbed 1.5%. Wall Street expects the iPhone maker to announce a stock buyback, following in the footsteps of fellow big tech companies Alphabet Inc. and Meta Platforms Inc. Any news about artificial intelligence could create additional excitement.

Ahead of the monthly employment report, data showed U.S. labor costs rose by the most in a year as productivity growth slowed, raising the risk that inflation will remain high. Economists polled by Bloomberg forecast a rise of 240,000 jobs in nonfarm payrolls, which would be the slowest pace since November.

The Fed decided Wednesday to leave its target range for benchmark interest rates at 5.25% to 5.5%, after a raft of data pointing to continued price pressure. Jerome Powell said it was unlikely the Fed’s next move would be a rate hike.

“While the Fed has all but ruled out a rate hike, it has also made clear that it is willing to keep rates high for longer,” said Chris Larkin of Morgan Stanley’s E*Trade. “Markets will be hungry for any data that suggests the economy is not warming any more than it did in the first quarter.”

The S&P 500 hovered around 5,040. Qualcomm Inc., the world’s largest seller of smartphone processors, rose on positive expectations. eBay Inc. dropped due to disappointing prospects. The ten-year government bond yield remained little changed at 4.63%. The dollar retreated.

The options market is betting that stocks will swing sharply after Friday’s U.S. jobs report, which traders expect will provide more clarity on how much the Federal Reserve will cut interest rates this year.

The S&P 500 Index is expected to move 1.2% in either direction after the release, based on the cost of at-the-money puts and calls expiring Friday, according to Stuart Kaiser, head of U.S. equity trading strategy at Citigroup Inc .

That figure, based on S&P bond prices as of Wednesday’s close, is the biggest implied swing ahead of an employment report since March 2023, he said.

Business highlights:

  • Peloton Interactive Inc. said Chief Executive Officer Barry McCarthy is stepping down as the company undergoes a major restructuring that will reduce its global workforce by 15% in an effort to reduce costs.

  • MGM Resorts International reported first-quarter revenue and profit that exceeded analyst expectations, benefiting from Macau’s post-pandemic recovery and a new partnership with Marriott International Inc. which helped fill hotel rooms.

  • Carvana Co. reported stronger profits with sales exceeding expectations as the company deepens its restructuring plan and regains sales momentum.

  • DoorDash Inc., the largest food delivery service in the U.S., offered a disappointing profit forecast for the current quarter as the company invests in expanding its list of non-restaurant partners and improving efficiency.

  • Moderna Inc. reported a smaller first-quarter loss than Wall Street expected as the biotech giant’s cost cuts helped offset a sharp decline in its Covid business.

  • Apollo Global Management Inc. reported higher first-quarter profits as the company raised management fees and extended a record $40 billion in private lending, a key growth area.

Main events this week:

  • Unemployment in the eurozone, Friday

  • U.S. Unemployment, Nonfarm Payrolls, ISM Services, Friday

  • Chicago Fed President Austan Goolsbee will speak on Friday

Some of the major moves in the markets:

Shares

  • The S&P 500 rose 0.4% as of 10:31 a.m. New York time

  • The Nasdaq 100 rose 0.5%

  • The Dow Jones Industrial Average rose 0.4%

  • The Stoxx Europe 600 had changed little

  • The MSCI World index rose 0.5%

Currencies

  • The Bloomberg Dollar Spot Index fell 0.4%

  • The euro fell 0.2% to $1.0688

  • The British pound fell 0.3% to $1.2487

  • The Japanese yen rose 0.1% to 154.40 per dollar

Cryptocurrencies

  • Bitcoin rose 2.4% to $58,651.28

  • Ether rose 1.3% to $2,975.97

Bonds

  • The yield on 10-year government bonds was little changed at 4.63%

  • The German ten-year yield fell by two basis points to 2.56%

  • The British ten-year yield fell by five basis points to 4.31%

Raw materials

  • West Texas Intermediate crude was little changed

  • Spot gold fell 1% to $2,296.52 an ounce

This story was produced with the help of Bloomberg Automation.

–With help from Ryan Vlastelica and Jessica Menton.

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