S&P 500 rises amid earnings surprises

The S&P 500 rose Wednesday as Wall Street tried to claw back some of the steep losses suffered in the previous session.

The S&P 500 advanced 0.96 per cent to finish at 5,000.62, while the Nasdaq Composite climbed 1.3 per cent to settle at 15,859.15. The Dow Jones Industrial Average added 151.52 points, or 0.4 per cent, closing at 38,424.27.

Lyft shares jumped 35 per cent after the ride-hailing company posted better-than-expected earnings in the fourth quarter. Airbnb slipped 1.7 per cent even as the company beat on revenue expectations in its latest quarter.

Shares of Nvidia nudged 2.5 per cent higher, sending the chipmaker’s market capitalization briefly above that of fellow “Magnificent 7” member Alphabet’s. This follows Nvidia’s roughly 0.2 per cent slide on Tuesday after rising Treasury yields sunk technology stocks.

On Tuesday, the 30-stock Dow lost more than 1 per cent for its worst day since March 2023. The S&P 500 and Nasdaq Composite also slumped more than 1 per cent. A hotter-than-anticipated inflation reading early in the morning incited the sell-off as traders fretted that the Federal Reserve may not cut interest rates as early as they had hoped.

January’s CPI report likely pushes the likelihood of a Fed rate cut to the second half of 2024, versus investors’ initial expectations of rate cuts as early as March.

Turning to commodities, oil prices reversed earlier gains on Wednesday as U.S. crude inventories surged, reflecting decreased demand, with West Texas Intermediate losing 1.58 per cent to settle at $76.64 a barrel and Brent settling at $81.60 a barrel, down 1.41 per cent. The decline followed a 1 per cent increase earlier in the trading session driven by geopolitical tensions after Israel's airstrikes in Lebanon in response to rockets fired into northern Israel.

Canada is planning to boost its energy security through an improved permitting process, as per energy minister Jonathan Wilkinson. Canada intends to reduce the time to approve mining permits through better funding to get rid of the administrative backlog.

Turning to US sectors, all closed higher overnight except for Consumer Staples and Energy. Industrials was the best performer.

Futures

The SPI futures are pointing to a 0.7 per cent gain.

Currency

One Australian dollar at 8.30am was buying 64.92 US cents.

Commodities

Gold lost 0.17 per cent. Silver added 1.13 per cent. Copper fell 0.24 per cent. Oil lost 1.63 per cent.

Figures around the globe

European markets closed higher. London’s FTSE gained 0.75 per cent, Frankfurt added 0.38 per cent, and Paris closed 0.68 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei lost 0.69 per cent, Hong Kong’s Hang Seng added 0.84 per cent and China’s Shanghai Composite was closed.

Yesterday, the Australian share market closed 0.73 per cent lower at 7,547.74.

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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