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Cisco to cut over 4,000 jobs, lowers annual revenue forecast
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CBRE surges on upbeat full-year profit forecast
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Deere cuts 2024 profit view, shares slide
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Indexes: Dow up 0.66%, S&P up 0.46%, Nasdaq up 0.19%
(Updated at 1:54 p.m. ET/18:54 GMT)
By Carolina Mandl, Johann M Cherian and Ankika Biswas
Feb 15 (Reuters) –
U.S. stocks rose on Thursday as retail sales data declined more than expected, feeding hopes the Federal Reserve will soon start cutting interest rates in coming months.
A Commerce Department report showed
U.S. retail sales
dropped 0.8% in January, weighed by declines at auto dealerships and gasoline service stations.
“Investors are cheering the fact that we got a weaker-than-anticipated retail report,” said Neville Javeri, a portfolio manager at Allspring Global Investments. “Maybe the consumer is slowing, maybe this negates the higher CPI number we saw a couple of days ago.”
Bets for a rate cut of at least 25 basis points in May edged up to 40%, while the odds for June stood at roughly 79%, according to the CME Group’s FedWatch Tool.
A Labor Department report showed initial claims for state unemployment benefits stood at 212,000 for the week ended Feb. 10, versus the estimated 220,000 figure.
The day’s data had investors less stressed about hotter than expected inflation data on Tuesday that sent stocks lower.
“The economy is doing fine, inflation is decisively down and we don’t want to focus on the minor fluctuations of these numbers,” said Todd Morgan, chairman of Bel Air Investment Advisors. “We just had a CPI print that was too hot and that’s just an aberration of the real direction; real inflation is approaching the Fed’s target.”
At 1:54 p.m. the Dow Jones Industrial Average rose 252.97 points, or 0.66% , to 38,677.24, the S&P 500 gained 22.65 points, or 0.46 %, to 5,023.27 and the Nasdaq Composite gained 29.71 points, or 0.19 %, to 15,888.85.
Alphabet dropped 2.5% after investment firm Third Point dissolved its stake in the megacap.
Apple slipped 1% after Warren Buffett’s Berkshire Hathaway trimmed its large stake in the iPhone-maker and Soros Fund Management entirely dissolved its stake.
Investor optimism grew as 80.3% of S&P 500 companies have now beaten earnings expectations, LSEG data showed, surpassing the annual 76% average.
CBRE Group jumped 9% after forecasting annual profit largely above estimates, driving a 2.3% rise in the S&P 500 real estate sector.
Recently underperforming sectors such as utilities , materials and energy notched strong gains, up between 1.2% and 2%. The small-cap Russell 2000 Index advanced 1.9%.
Cisco Systems shed 1.7% as it announced plans to cut 5% of its global workforce and lowered its annual revenue target.
Deere & Co, the world’s largest farm-equipment maker, lost 6.1% after cutting its 2024 profit forecast. West Pharmaceutical Services tumbled 13.9% after forecasting full-year results below estimates.
Advancing issues outnumbered decliners by a 5-to-1 ratio on the NYSE and a 2.4-to-1 ratio on the Nasdaq.
The S&P index recorded 62 new 52-week highs and two new lows, while the Nasdaq recorded 208 new highs and 58 new lows.
(Reporting by Carolina Mandl, in New York, Johann M Cherian and Ankika Biswas in Bengaluru; Editing by Pooja Desai and David Gregorio)
Read More: US STOCKS-Wall Street surges as retail sales slump feeds hopes for Fed rate cuts