Tech stocks power Wall Street gains, tariff relief hope

Perth Now

2 days ago

Wall Street's main indexes have advanced, lifted by hopes that technology giants might dodge President Donald Trump's newest tariffs on chip imports.
Apple's shares climbed 2.4 per cent, having risen 5.1 per cent and led gains on Wall Street in the prior session, after Trump said the iPhone maker will invest an additional $US100 billion ($A153 billion) in the US.
This brings its total commitment to $US600 billion ($A920 billion) over the next four years.
Trump also announced a tariff of about 100 per cent on imports of semiconductors, but said it would not apply to companies that are manufacturing in the US or have committed to do so.
Shares of chipmakers Nvidia and Broadcom rose 1.3 per cent each, while peer Advanced Micro Devices advanced 3.0 per cent.
The tech sector emerged as the top performer, gaining 1.1 per cent, while the healthcare sector fell to the bottom.
Eli Lilly dropped 11.2 per cent after reporting data on its late-stage oral weight-loss drug. The drugmaker also raised its full-year profit forecast.
In early trading on Thursday, the Dow Jones Industrial Average rose 263.08 points, or 0.60 per cent, to 44,456.20, the S&P 500 gained 37.82 points, or 0.60 per cent, to 6,382.88 and the Nasdaq Composite gained 177.85 points, or 0.84 per cent, to 21,347.27.
Trump's higher tariffs of 10 per cent to 50 per cent on dozens of trading partners took effect on Thursday.
Fresh signs of a faltering labour market, especially after a disappointing July payrolls report, have fuelled speculation that the Federal Reserve could soon kick off a rate-cutting cycle.
Underscoring the jitters, new data showed jobless claims came in at 226,000 for the week of August 2, surpassing economists' expectations of 221,000.
"It's certainly validating the increase in jobless claims we've been seeing, which also jives with the weakness we saw in the employment report," said Ben Laidler, head of equity strategy at Bradesco BBI.
"The narrative is clear, the economy is slowing. It may not be headed towards recession, but it's definitely slowing."
Traders are now betting almost fully on a September rate cut, with at least two moves expected this year, CME Group's FedWatch tool showed.
Investors are also watching for Trump's interim replacement for Fed Governor Adriana Kugler in the coming days, amid expectations that the nominee would be a policy dove who will likely favour bringing interest rates lower.
Kugler's resignation leaves an opening at the seven-member Fed Board led by Chair Jerome Powell, who Trump has repeatedly criticised for not cutting borrowing costs.
Powell's tenure is due to end in May.
Meanwhile, chipmaker Intel lost 0.7 per cent after Trump called for its chief executive's resignation, saying, "the Intel CEO is highly conflicted and should resign immediately".
Second-quarter earnings barrage continued at full throttle.
DoorDash topped revenue estimates and forecast a stronger-than-expected gross merchandise value for the current quarter. Its shares jumped 4.9 per cent.
Datadog gained 6.2 per cent after beating estimates for second-quarter results.
Airbnb slumped 8.4 per cent after the company forecast slower growth for the second half of the year.
Advancing issues outnumbered decliners by a 4.32-to-1 ratio on the NYSE and by a 2.32-to-1 ratio on the Nasdaq.
The S&P 500 posted 17 new 52-week highs and no new lows, while the Nasdaq Composite recorded 41 new highs and 28 new lows.