Nasdaq Composite up 0.52% as Market Regains Footing after Wednesday Slide
Stocks are ticking upward Thursday after a sharp decline on Wednesday brought on by trade tensions between China and the U.S.
Quick overview
- The stock market saw a sharp selloff on Wednesday but showed signs of recovery on Thursday, with the Nasdaq Composite gaining 0.52%.
- The S&P 500 and Dow Jones also experienced slight increases, indicating a potential rebound led by tech stocks.
- Wednesday's decline was attributed to escalating trade tensions between the U.S. and China, particularly regarding software export restrictions.
- Investors remain hopeful for positive tech earnings reports, but the market's volatility suggests a challenging outlook ahead.
On Wednesday, the stock market experienced a sharp selloff, but the stock indices showed signs of recovery on Thursday with the Nasdaq Composite adding 0.52%.
The S&P 500 gained 0.32% on Thursday morning as the markets opened, and the Dow Jones climbed 0.05%. With the Nasdaq adding 0.52%, it looks like tech stocks are leading Thursday’s recovery.
Wednesday’s lower performance was a result of the increased trade difficulties between China and the U.S., specifically comments from U.S. treasury Secretary Scott Bessent confirming that the White House intends to limit software exports to China. Those restrictions should go into effect on November 1st.
Why the Stock Market Is Ticking Upward
There may be no major improvement in the trade situation, but stocks are climbing for Thursday. That uptick can be attributed to the already elevated state of the stock market as well as hope that tech stocks will report positive earnings very soon.
Two of the top tech companies reported losses for the most recent quarter. Tesla (TSLA) saw its stock dip 4% on Wednesday and then 2.77% on Thursday after reporting less than stellar quarterly earnings. IBM suffered a 5% stock loss after meeting expectations on some aspects of revenue and coming in right at expectations on others.
Investors appear hopeful that some of the tech earnings reports this month will be positive, but those quarterly reports will need to be overwhelmingly upbeat in order to keep stock values high. The market may be elevated right now, with tech stocks performing most of the heavy lifting, but the market is in a volatile place at the moment.
Investors should buckle up for a rough weekend and a bearish start to next week as well so long as trade tensions remain high between the United States and China. Their trade disputes are going to affect technology stocks the most, and that means the highest performers could be brought very low soon.
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