Real estate investment trusts were the session’s biggest losers as yields on government bonds jumped, making property stocks’ returns less attractive. Warehouse and data centre giant Goodman Group fell 2.8 per cent, retail landlords Scentre and Stockland lost 2 per cent and 2.6 per cent, respectively, and office property owner Charter Hall dropped 2.4 per cent.
Overnight in New York, the S&P 500 gained 0.3 per cent and pulled within 0.6 per cent of its all-time high set in late October. The Dow Jones climbed 0.9 per cent, and the Nasdaq composite added 0.2 per cent.
Stocks broadly got a lift from easing Treasury yields in the bond market. Yields fell after a report suggested US employers outside of the government may have cut more jobs in November than they added.
While the surprisingly weak report from ADP may be discouraging for people looking for jobs, it also bolstered expectations that the Federal Reserve will cut its main interest rate next week. If the Fed does, that would be the third cut of the year in hopes of helping the slowing job market.
Investors love lower interest rates because they boost prices for investments and can charge up the economy.
The biggest jump in the S&P 500 came from Microchip Technology, which leaped 12.2 per cent after saying it expects sales and profit for the final months of the year to come in at the high end of the forecast ranges it earlier gave. CEO Steve Sanghi said business is doing better than expected, and it’s reducing inventory levels.
Marvell Technology was another winner and rose 7.9 per cent after the supplier of semiconductor products delivered a stronger profit for the latest quarter than analysts expected. CEO Matt Murphy credited demand for its data centre products, while also announcing a purchase of Celestial AI to bolster its artificial-intelligence infrastructure business. The deal’s price tag could top $US3.25 billion.
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American Eagle Outfitters was another winner and rallied 15.8 per cent after the retailer reported a better profit than expected. Its CEO, Jay Schottenstein, said it also saw a strong start to the holiday shopping season with an acceleration in demand across its brands during the Thanksgiving weekend.
Macy’s rose 2.3 per cent after reporting a profit for the latest quarter that was much better than the loss that analysts were expecting. The stock came into the day with a rally of 34.1 per cent for the year so far, more than double the S&P 500’s rise.
On the losing end of Wall Street were relatively few companies. But among them were some of the market’s most influential stocks, which kept indexes in check.
Microsoft fell 1.6 per cent and was the heaviest weight on the S&P 500. Nvidia slipped just 0.6 per cent, but because it’s the most valuable stock on Wall Street, it was another one of the heaviest weights dragging on the index.
In other international markets, indexes were close to flat in Europe following a mixed finish in Asia.
With AP, Bloomberg
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