The S&P 500 Index ($SPX) (SPY) closed down -0.13% on Thursday, the Dow Jones Industrials Index ($DOWI) (DIA) closed up +0.11%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -0.53%. E-mini S&P March futures (ESH26) fell -0.20% and E-mini Nasdaq March futures (NQH26) fell -0.57%.
Stock indexes closed mostly lower on Thursday, with the S&P 500 and Dow Jones Industrial Average falling to one-week lows. Concerns about AI spending weighed on stocks on Thursday, as Microsoft sank -10% after reporting disappointing growth in its cloud business and higher-than-expected expenses. Microsoft’s decline undermined most of the Magnificent Seven tech stocks, excluding Meta Platforms and Apple, and weighed on the broader market.
Meta Platforms rallied more than 10% on Thursday and was a positive factor for the market after providing a much stronger than expected revenue outlook. Additionally, International Business Machines rose more than 5% and Honeywell International rose 4% to help the Dow Jones Industrial Average recover from a one-week low and move into positive territory after they reported better-than-expected fourth-quarter earnings results.
Stocks rebounded from their worst levels Thursday on signs that a deal to fund the government was near. Thune, the Senate majority leader, said an emerging deal would put the Department of Homeland Security on interim funding while other agencies would get funding through Sept. 30. Without a deal, government funding will expire Saturday for much of the federal government.
WTI crude oil (CLH26) prices rose more than +3% to a 4.25-month high on Thursday to boost energy producers after President Trump said on Wednesday that he wants Iran to come to the table and negotiate a nuclear deal that is “a fair and equitable deal without nuclear weapons.” He warned Iran that time is running out to reach a deal with the United States and noted that a fleet of American warships entering the region is ready to complete its mission “with speed and violence.”
US Weekly Initial Jobless Claims fell -1,000 to 209,000, showing a slightly weaker labor market than expectations of 205,000. However, continuing claims fell -38,000 to a six-month low of 1.827 million, showing a stronger labor market than expectations of 1.85 billion.
The US trade deficit in November was -$56.8 billion, higher than expectations of -$44 billion and the largest deficit in four months.
US Factory Orders in November rose +2.7% MoM, stronger than expectations of +1.6% MoM and the largest increase in 6 months.
Threats to stocks and the dollar persist. President Trump has threatened new 100% tariffs on US imports from Canada, the possibility of a US government shutdown over ICE funding, and lingering concerns about Greenland.
The market’s focus this week will be on new tariff news and the prospects for a continuing resolution (CR) to fund the government. On Friday, December PPI final demand is expected to decline to +2.8% YoY from +3.0% YoY in November, and December PPI excluding food and energy is expected to decline to +2.9% YoY from +3.0% YoY in November. Additionally, the January Chicago PMI MNI is expected to rise +0.8 to 43.5.
Fourth-quarter earnings season is in full swing, with 102 of the S&P 500 companies scheduled to report results this week. Apple reports after the close today. Earnings have been a positive factor for stocks, with 77% of the 143 S&P 500 companies reporting beating expectations. According to Bloomberg Intelligence, S&P earnings growth is expected to increase +8.4% in the fourth quarter. Excluding the Magnificent Seven mega-cap tech stocks, Q4 earnings are expected to increase +4.6%.
Markets are pricing in a 14% chance of a -25bp rate cut at the next policy meeting on March 17-18.
Foreign stock markets closed mixed on Thursday. The Euro Stoxx 50 fell to a one-week low and closed down -0.70%. China’s Shanghai Composite hit a two-week high and closed up +0.16%. Japan’s Nikkei Stock 225 closed up +0.03%.
Interest rates
March 10-year Treasuries (ZNH6) closed up +7 ticks on Thursday. The 10-year Treasury yield fell -1.6 bps to 4.227%. Treasury bond prices recovered from early losses on Thursday and rose after a drop in stocks fueled some demand for safe-haven government debt. Additionally, Thursday’s report on weekly jobless claims came in higher than expected, a supportive factor for Treasuries.
Gains in Treasuries were limited with the price of crude oil jumping 3% on Thursday to a 4.25-month high, boosting inflation expectations. Additionally, weak demand from the Treasury auction for $44 billion in 7-year Treasuries was negative for Treasuries, as the auction had a bid-to-cover ratio of 2.45, below the 10-auction average of 2.54.
European government bond yields fell on Thursday. The German 10-year bond yield fell to a 1.5-week low of 2.821% and ended down -1.7bp to 2.840%. The 10-year UK bond yield fell from a 2.25-month high of 4.566% and ended down -3.3bps to 4.511%.
The Eurozone economic confidence indicator in January rose +2.2 to a three-year high of 99.4, stronger than expectations of 97.1.
Eurozone December M3 money supply increased +2.8% year-on-year, below expectations of +3.0% year-on-year.
The swaps price in a 0% probability that the ECB will raise rates +25 bps at its next monetary policy meeting on February 5.
US Stock Engines
Cryptocurrency-exposed socks retreated on Thursday as Bitcoin (^BTCUSD) fell more than -5% to a 2.25-month low. Strategy (MSTR) closed down more than -9% and Galaxy Digital Holdings (GLXY) closed down more than -6%. Additionally, Coinbase (COIN) and MARA Holdings (MARA) closed down more than -4%, and Riot Platforms (RIOT) closed down more than -3%.
Microsoft (MSFT) closed down more than -10% to lead the losers in the Dow Jones Industrials on disappointment that Q2 revenue from Azure and other cloud services ex-forex failed to beat expectations, up +38% year-over-year and right in consensus.
Las Vegas Sands (LVS) closed down more than -13% to lead the losers in the S&P 500 after reporting its Macau fourth-quarter adjusted real estate Ebitda from operations of $608 million, weaker than the consensus of $626.1 million.
United Rentals (URI) closed down more than -12% after reporting fourth-quarter revenue of $4.21 billion, weaker than the consensus of $4.25 billion, and forecasting full-year revenue of $16.8 billion to $17.3 billion, the midpoint below the consensus of $17.14 billion.
HubSpot (HUBS) closed down more than -11% after BMO Capital Markets lowered its price target on the stock to $385 from $465.
ServiceNow (NOW) closed down more than -10% after reporting an adjusted gross margin of 80.5% in the fourth quarter, weaker than the consensus of 81.2%.
Tractor Supply Co (TSCO) closed down more than -7% after reporting fourth-quarter net sales of $3.9 billion, weaker than the consensus of $3.99 billion, and forecasting full-year comparable sales of between +1% and +3%, the midpoint below the consensus of +2.96%.
Whirlpool (WHR) closed down more than -5% after reporting Q4 net sales of $4.1 billion, below consensus of $4.26 billion, and forecasting full-year ongoing EPS of around $7.00, weaker than consensus of $7.23.
Dow Inc. (DOW) closed down more than -2% after reporting fourth-quarter net sales of $9.46 billion, missing the consensus of $9.5 billion.
Meta Platforms (META) closed up more than +10% to lead gains on the Nasdaq 100 after reporting fourth-quarter revenue of $59.89 billion, better than the consensus of $58.42 billion, and forecasting first-quarter revenue of $53.5 billion to $56.5 billion, well above the consensus of $51.27 billion.
International Business Machines (IBM) closed up more than +5% and led the gains in the Dow Jones Industrials after reporting fourth-quarter revenue of $19.69 billion, stronger than the consensus of $19.21 billion.
Southwest Airlines (LUV) closed up more than +18% to lead gains in the S&P 500 after forecasting first-quarter adjusted EPS of at least 45 cents, well above the consensus of 28 cents.
Royal Caribbean Cruises Ltd (RCL) has surged more than +18% to lead cruise stocks higher after forecasting full-year adjusted earnings per share of between $17.70 and $18.10, stronger than the consensus of $17.67. Additionally, Norwegian Cruise Line Holdings (NCLH) closed up more than +10% and Carnival (CCL) closed up more than +8%.
Honeywell International (HON) closed up more than +4% after forecasting full-year adjusted earnings per share between $10.35 and $10.65, the midpoint better than the consensus of $10.41.
CH Robinson Worldwide (CHRW) closed up more than +4% after reporting fourth-quarter adjusted diluted EPS of $1.23, better than the consensus of $1.13.
Lockheed Martin (LMT) closed up more than +3% after forecasting full-year earnings per share of between $29.35 and $30.25, well above the consensus of $29.09.
Earnings Reports (01/30/2026)
Air Products and Chemicals Inc (APD), American Express Co (AXP), Aon PLC (AON), Charter Communications Inc (CHTR), Chevron Corp (CVX), Church & Dwight Co Inc (CHD), Colgate-Palmolive Co (CL), Exxon Mobil Corp (XOM), Franklin Resources Inc (BEN), LyondellBasell Industries NV (LYB), Regeneron Pharmaceuticals Inc (REGN), Verizon Communications Inc (VZ).
On the date of publication, Rich Asplund had no (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. This article was originally published on Barchart.com
