U.S. stocks ended mostly higher on Thursday as a fusillade of better-than-expected corporate results helped to reinvigorate Wall Street buying appetite a day after the S&P 500 and the Dow posted their biggest drops in more than seven weeks.
The House of Representatives also passed a budget blueprint, paving the way for the Senate to eventually pass a tax-reform package by a simple majority. Some analysts view passage of a tax-cut package as critical to extending the stock-market rally.
What did stock indexes do?
The Dow Jones Industrial Average DJIA, +0.31% rose 71.40 points, or 0.3%, to 23,400.86. The S&P 500 SPX, +0.13% gained 3.25 points, or 0.1%, at 2,560.40, while the Nasdaq Composite Index COMP, -0.11% edged down 7.12 points, or 0.1%, at 6,556.77.
Nasdaq was buffeted by weakness in the biotechnology sector, which also weighed on the overall health-care group. The iShares Nasdaq Biotechnology ETF IBB, -2.32% slid 2.3% while the health-care sector lost 1%, marking the S&P 500’s worst performing sector on the day.
What’s driving the market?
The House of Representatives narrowly passed a budget bill on Thursday, which paves the way for the Senate to later pass a tax-reform package with a simple majority, instead of 60 votes.
Earlier in the session, the European Central Bank announced plans to extend the length of its quantitative-easing measures but reduce its monthly asset purchases. The move had been expected, but it represented a very gradual tapering of crisis-era measures by the central bank. The ECB, as expected, left interest rates unchanged and reiterated that it anticipated them to remain at present levels for an “extended period” and beyond the eventual end of its asset buying program.
Read:Draghi averts ‘taper tantrum’—for now—as ECB takes baby step toward ending QE
The markets are also closely monitoring President Donald Trump’s coming pick to head the Federal Reserve after Chairwoman Janet Yellen’s term ends in February. Yellen is out of the race for the top spot, according to two reports on Thursday, leaving Fed Gov. Jerome Powell and Stanford University economist John Taylor as front-runners.
See:What investors need to know about Fed candidate John Taylor’s famous rule
What did analysts say?
On the Fed leadership watch, Kevin Giddis, head of fixed income capital markets at Raymond James, said it is likely a three-way race between Jay Powell, John Taylor, and Yellen.
“If it is John Taylor (hawk), look for the 10‐year to take out 2.50% without a problem,” he said in a note.
What data were in focus?
Weekly jobless claims rose by 10,000 to 233,000 in the latest week, holding at a historically low level.
Pending home sales showed a decline to a 2½ year low in September, missing consensus estimates for a rise of 0.4%, as the housing market is buffeted by lean supply and strong demand. Meanwhile, the advanced U.S. trade deficit widened by 1.3% in September.
See:MarketWatch’s economic calendar
Which stocks were in focus?
Shares of Twitter Inc.TWTR, +18.49% surged 18.5%, booking their best daily performance since September 2016, after the social-media group reported narrower losses. But Twitter also admitted to overstating users for years.
Celgene Corp.CELG, -16.37% plummeted 16.4% after the company reported a third-quarter profit beat and revenue miss and lowered its 2017 profit and revenue outlook. The stock pressured the overall biotech and health-care sectors.
Tenet Healthcare Corp.THC, -9.17% shares tanked 9.2% following a Reuters report that the hospital operator has ended its plan to sell itself after its chief executive abruptly left ahead of schedule.
Nutrisystem Inc.NTRI, -10.51% continued to slide, falling 10.5%, despite turning in better-than-expected quarterly earnings.
Ford Motor Co.F, +1.91% rose 1.9% after the auto maker beat profit and revenue estimates.
Buffalo Wild Wings Inc.BWLD, +19.57% shares soared 19.6% after a big profit boost due to a switch to boneless wings for one of its signature promotions.
Bristol-Myers Squibb Co.BMY, -4.77% shares fell 4.8% after the company missed on profit and revenue and changed its 2017 guidance
Shares of CVS Health Corp.CVS, -2.94%Rite Aid Corp.RAD, -6.18%Express Scripts Holding Co.ESRX, -3.65% and Walgreens Boots Alliance Inc.WBA, -3.24% all fell sharply after Amazon.com Inc.AMZN, -0.05% secured a wholesale pharmacy license. Amazon rose 0.8%.
Shares of Pfizer Inc.PFE, -1.16% fell 1.2% after a Reuters report that the drugmaker will begin the auction process for its consumer health care unit in November.
U.S.-listed shares of Nokia Corp.NOK, -21.32% tumbled 21% after the Finnish telecommunications company said its loss widened in the third quarter.
Shares of 3M Co. MMM, -1.99% which jumped after the maker of Post-it Notes reported better-than-expected quarterly results earlier in the week, closed down 2%.
CVS Health Corp. CVS, -2.94% was in talks to buy Aetna Inc. AET, +11.54% in a deal that could value the health insurer at more than $66 billion, according to The Wall Street Journal. CVS’s shares closed regular trade down 2.9%, while Aetna’s shares jumped 11.5%.
U.S.-listed shares of Barclays PLCBCS, -9.48% slid 9.5% and those ofDeutsche Bank AGDB, -2.34% fell 2.3% after each bank reported earnings.
How did other markets fare?
The euro EURUSD, +0.0172% fell to $1.166 as that ECB announcement was made, down from $1.181 late Wednesday in New York. The ICE Dollar Index DXY, +1.06% jumped 0.1%.
Oil prices CLZ7, +1.23%reversed earlier drop to settle higher, while gold GCZ7, -0.89% finished lower.
Stocks in Asia closed mixed, while European stocks held steady at a higher level after the ECB announcement. Gains were led by Spanish stocks IBEX, +1.92% which soared almost 2% on reports that Catalan President Carles Puigdemont could call early elections and dissolve parliament. However, later reports indicated that the Catalan leader may not call a snap election.
Read:Why Italy faces worst shock in Europe as ECB prepares to taper bond buys
—Sara Sjolin and Mark DeCambre contributed to this article.
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