In a trading session marked by a blend of optimism and concern, the stock market exhibited a mixed performance on Thursday, with the Dow Jones Industrial Average managing to eke out a marginal gain. The market's resilience was largely attributed to a robust rally in the technology sector, driven by the stellar performance of Alphabet Inc. and Advanced Micro Devices (AMD), which offset the losses seen in energy stocks. All eyes are now on the upcoming monthly jobs report, set to be released on Friday, which is expected to provide further insights into the state of the labor market.
By the closing bell at 16:00 ET (21:00 GMT), the S&P 500 had surged by an impressive 0.80%, while the Dow Jones Industrial Average edged up by a modest 0.2%, or 18 points. The tech-heavy Nasdaq Composite, fueled by the impressive performance of tech giants, had soared by 1.4%.
Alphabet's AI Unveiling and AMD's AI Advancements Fuel Tech Surge
Alphabet Inc. Class A (NASDAQ: GOOGL) emerged as a standout performer, with its stock price surging by more than 5% on the back of a significant announcement. The tech titan unveiled its latest AI model, Gemini, a multi-model AI system with the capability to understand audio, photos, and video. This unveiling was seen as Alphabet's strategic move to compete with rivals such as OpenAI, Microsoft (NASDAQ: MSFT), and Meta (NASDAQ: META), in the ever-evolving AI landscape.
Simultaneously, chip stocks played a pivotal role in supporting the broader technology sector, registering an impressive gain of nearly 3%.
This boost was primarily attributed to Advanced Micro Devices Inc. (NASDAQ: AMD), which saw its stock price soar by more than 9% following the launch of its new AI chip, MI300X. AMD's management expressed confidence in the chip's capabilities, even asserting that "MI300X performance surpasses NVDA H100 for AI workloads," as noted by Oppenheimer in a research report.
C3.ai and Chewy Face Challenges, GameStop Charts a New Course
Not all stocks enjoyed the day's gains, however. C3.ai (NYSE: AI), a favorite among retail investors, faced a significant setback, with its shares plummeting by nearly 11%. This decline was precipitated by the company's guidance, which indicated a full-year adjusted operating loss in the range of $115 million to $135 million, exceeding its prior forecast of $70 million to $100 million.
Chewy (NYSE: CHWY), an online pet-care retailer, also grappled with challenges, experiencing a drop of nearly 1% in its share price. The company trimmed its annual sales outlook due to inflationary pressures, which have adversely impacted customer demand.
On a different note, GameStop (NYSE: GME) managed to defy market expectations by posting a 10% increase in its share price. This boost came as the video game retailer unveiled a plan to amend its investment policy, allowing it to invest in equity securities. Despite quarterly results missing the top-line expectations, this strategic move garnered significant attention from investors.
Focus Shifts to Labor Market Data Ahead of Nonfarm Payrolls
As the stock market absorbed these developments, a key focus remained on the labor market data released during the trading session. The report revealed that the number of Americans filing for first-time unemployment aid had slightly increased to 220,000, up from 219,000 the previous week. While this uptick was modest, it contributed to a growing body of data pointing to a softening labor market.
Attention now turns to the eagerly awaited nonfarm payrolls report for November, which is expected to take center stage.
Economists anticipate that the economy added 180,000 new jobs during the month, with the unemployment rate likely to remain steady at 3.9%. Of note, average hourly earnings are projected to have increased by 0.1%. This report will provide valuable insights into the health and direction of the labor market, influencing investor sentiment in the days to come.
