Stocks gain as Fed’s Jackson Hole meeting underway

Stocks gain as Fed’s Jackson Hole meeting underway

Stocks rose sharply on Thursday as central bankers from around the world gathered for the US Federal Reserve’s much-anticipated Jackson Hole economic symposium.

The S&P 500 jumped 1% after the index broke a three-day streak of losses in the previous session, and the tech-heavy Nasdaq Composite advanced 1.4%. The Dow Jones Industrial Average added 150 points, or about 0.5%.

Peloton Interactive (PTON) was in the spotlight Thursday morning after the fitness equipment maker reported an operating loss of more than $1 billion in its fiscal fourth quarter as revenue fell short. of Wall Street expectations. The results sent shares down 13% at the start of the session.

Investors will tune in to the Fed meeting in Wyoming for clues from central bank officials on the pace and magnitude of their rate hike plans for the rest of this year, as activity appears to slow in some facets of the US economy. USA. The most watched part of the meeting is scheduled for Friday, with Chairman Jerome Powell scheduled to make comments that could indicate whether the central bank’s next monetary policy announcement in September will result in another 75 basis point increase or a slighter increase. of 0.50%.

“It is widely expected that Jerome Powell will continue his narrative on fighting inflation, deterring markets from the notion that the Fed has made a dovish pivot,” David Norris, partner and head of US credit at TwentyFour Asset Management, said in a note. . “Markets are anticipating a more aggressive statement from Powell along the lines of a ‘higher for longer’ narrative about interest rates.”

WASHINGTON, DC - JULY 27: US Federal Reserve Board Chairman Jerome Powell speaks during a press conference following a Federal Open Market Committee (FOMC) meeting at Federal Reserve Headquarters, July 27, 2022 in Washington, DC.  Powell announced that the Federal Reserve is raising interest rates by three-quarters of a percentage point.  (Photo by Drew Angerer/Getty Images)

U.S. Federal Reserve Board Chairman Jerome Powell speaks during a press conference following a Federal Open Market Committee (FOMC) meeting at Federal Reserve Headquarters, July 27, 2022 in Washington, DC. (Photo by Drew Angerer/Getty Images)

Still, the Federal Reserve’s policy is expected to be dictated by economic data meeting by meeting.

On Thursday, BEA data showed that economic activity contracted less than initially estimated in the second quarter. The second estimate of second-quarter GDP showed the economy contracted at an annualized rate of 0.6% during the quarter, down from the 0.9% reported late last month.

Labor market data also showed a drop in initial jobless claims, with around 243,000 people applying for jobless benefits last week, down from 250,000 the week before. The previous week’s data was also revised to 245,000 from 250,000.

Elsewhere, Nvidia (NVDA) shares tumbled 3% ahead of the open after the chipmaker released quarterly results on Wednesday that missed estimates and lowered its guidance for the next period.

Salesforce (CRM) shares are down nearly 8% in extended trading after the software giant lowered its annual revenue and profit outlook against a stronger dollar and more moderate spending by its customers.

Tesla (TSLA) shares, meanwhile, were up about 1.8% ahead of the market after the electric vehicle giant executed a shareholder-approved 3-for-1 stock split earlier this month after Wednesday’s bell. fair. The move comes exactly two years after a 5-for-1 stock split and is aimed at attracting more retail investors.

Crude oil futures were close to $95 a barrel. Earlier this week, Saudi Arabia suggested that the OPEC+ alliance could make production cuts possible.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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