US equities posted modest gains on Thursday as investors digested a strong January jobs report, fresh corporate earnings, and new labour market data, while keeping a close watch on inflation indicators that could shape the path of interest rates.
The Dow Jones Industrial Average rose 295 points, or about 0.6%.
The S&P 500 advanced 0.3%, while the Nasdaq Composite gained 0.4%, reflecting cautious optimism following a volatile start to the week.
Earnings reactions shape trading
Individual stocks moved sharply as investors reacted to company updates.
Shares of Cisco Systems fell about 7% after the networking equipment maker issued weaker-than-expected guidance for the current quarter, raising concerns about near-term demand.
By contrast, McDonald’s turned positive after reporting earnings that beat expectations.
The stock rose around 1%, offering some support to the broader consumer discretionary sector.
The mixed earnings response reflected continued selectivity among investors, with guidance and forward outlooks playing a central role in stock performance.
Market steadies after uneven prior session
Thursday’s gains followed a subdued trading session a day earlier.
On Wednesday, the Dow slipped more than 66 points, while the Nasdaq fell about 0.2%. The S&P 500 ended marginally lower.
Markets initially rallied on Wednesday after the release of the January nonfarm payrolls report, which showed job growth of 130,000 — far above forecasts and well ahead of December’s revised figure.
The unemployment rate edged down to 4.3% from 4.4%.
However, those early gains faded as investors weighed the broader implications of stronger hiring for monetary policy and inflation.
The January employment data eased concerns that the labour market was losing momentum after months of subdued hiring.
Recent reports had pointed to what economists often describe as a “low-hire, low-fire” environment, in which companies are reluctant to expand payrolls but also hesitant to lay off workers.
The stronger-than-expected payrolls report reassured investors about economic resilience.
At the same time, it complicated expectations around interest rates, as sustained labour strength could limit the scope for further easing by the Federal Reserve.
If inflation remains elevated, the combination of firm hiring and price pressures could reduce the likelihood of multiple rate cuts, making upcoming inflation data especially important.
Jobless claims show stability
Additional labour market data released on Thursday pointed to continued stability.
The US Department of Labor reported that initial jobless claims totalled 227,000 for the week ended February 7, down 5,000 from the prior week’s upwardly revised level.
The figure was slightly above the Dow Jones estimate of 225,000.
Continuing claims increased by 21,000 to 1.86 million. Despite the rise, the four-week moving average fell to its lowest level since October 2024, suggesting that longer-term unemployment pressures remain contained.
Investors are now turning their attention to upcoming economic releases that could further influence market direction.
The January consumer price index is due on Friday and is expected to provide fresh insight into inflation trends.
The data will be closely watched for signs of whether price pressures are easing enough to give the Federal Reserve greater flexibility.
Meanwhile, January’s existing home sales report is scheduled for release later Thursday.
Economists surveyed by Dow Jones expect sales to come in at an annualised pace of about 4.15 million.
The housing data follows a mixed run of economic indicators this week.
Tuesday’s retail sales report showed flat consumer spending in December, disappointing expectations and raising questions about household demand at the start of the year.
The post US stocks open in the green: Dow surges 300 points, S&P up 0.3% appeared first on Invezz
