Wall Street Opens Mixed After GDP, George Comments; Dow up 50 Pts

By Geoffrey Smith 

Investing.com -- U.S. stock markets opened mixed on Thursday, after a fresh reminder of the pressure on the Federal Reserve to end a quantitative easing policy that some feel is doing more harm than good. 

Esther George, president of the Kansas City Federal Reserve, told CNBC that the Fed should start tapering its bond purchases - currently running at $120 billion a month - "sooner rather than later," given the progress that the economy has made in recovering from the pandemic. George's comments come a day ahead of a keenly-awaited speech by Fed Chairman Jerome Powell.

“It doesn’t mean that we will move all the way to neutral or tighter policy, but I think it’s a first step," George said. "“When you look at the job gains we saw last month, the month before, you look at the level of inflation right now, I think it would suggest that the level of accommodation we’re providing right now is probably not needed."

Such signs were evident in the latest weekly jobless claims data, which stayed to last week's post-pandemic low at 353,000. The economy grew by slightly more than expected in the second quarter, at an annualized rate of 6.6%, but the second reading of the GDP report provided no new shocks with regard to inflation. 

By 9:35 AM ET (1335 GMT), the Dow Jones Industrial Average was up 54 points, or 0.2%, at 35,460 points. The S&P 500 and Nasdaq Composite, however, were both down by less than 0.1%, after closing at new record highs on Wednesday.

Enterprise software companies were in vogue in early trade, as their quarterly updates and the steady deterioration of the U.S.'s Covid-19 situation both encouraged demand for stocks that have already done well out of the pandemic. Salesforce.com (NYSE:CRM) stock rose 4.7% while Snowflake (NYSE:SNOW) stock rose 4.1%. Zoom Video (NASDAQ:ZM) stock also rose 4.6%, although Splunk (NASDAQ:SPLK) stock fell 1.1% in the wake of its update and Autodesk (NASDAQ:ADSK) fell an alarming 14% after a weaker-than-expected outlook for the rest of the year.

Williams-Sonoma (NYSE:WSM) stock was another big gainer, continuing to profit from the greater diversion of consumer spending to home comforts and furnishings during the pandemic. The stock rose 12% after the company increased its dividend, expanded its buyback program and raised its guidance again.

Going in the other direction were Dollar Tree and Dollar General. Dollar Tree (NASDAQ:DLTR) stock fell 10.5% and Dollar General (NYSE:DG) stock fell 7.0%, after both discount retailers warned of rising costs that their business model hardly allows them to pass on to customers. 

Elsewhere, the cosmetics sector delivered some more impressive results, profiting from the reopening of both offices and entertainment spaces during the spring and early summer.  Coty (NYSE:COTY) stock rose 14% while Ulta Beauty (NASDAQ:ULTA) stock edged 0.3% higher. 

Get The News You Want

Read market moving news with a personalized feed of stocks you care about.

Get The App