U.S. stocks took a breather, opening mostly lower on Thursday after two days of rallies this week that pushed the broad S&P 500 index to an intraday record high on Wednesday.
So far, investors have been relieved President Donald Trump has backed away from aggressive, across-the-board tariffs during his first days in office. However, Trump is slated to virtually address the World Economic Forum in Davos at 5 PM Davos time, or late morning in New York, potentially offering more clues on trade policy and timing of tariffs.
“One new area of interest may be the international tax code, where he (Trump) could potentially tariff countries trying to enact the OECD’s Global Minimum Tax,” said Chris Turner, head of foreign exchange strategy at Dutch bank ING.
The OECD’s, or Organisation for Economic Co-operation and Development’s Global Minimum Tax is meant to ensure multinational companies pay a minimum level of income tax wherever they operate.
Markets shrugged off a rise in first-time jobless claims last week to 223,000, a six-week high driven by Californians displaced due to the wildfires. So-called continuing claims, or those who have already been collecting weekly unemployment benefits, rose to the highest level since 2018, excluding the pandemic era, suggesting it’s taking unemployed workers longer to find jobs.
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At 10:12 AM ET, the S&P 500 was down 0.7%, or 4.30 points, to 6,082.07; the blue-chip Dow edged up 0.24%, or 104.04 points, to 44,260.77; and the tech-laden Nasdaq slid 0.44%, or 87.83 points, to 19,921.51. The benchmark 10-year Treasury yield was just higher at 4.642%.
Corporate news
As investors await more remarks from Trump, they’re focusing on company news.
American Airlines unexpectedly warned of a loss per share in the first three months of the year that could pull full year earnings below analysts’ forecasts. Shares were down almost 9%.
In contrast, Alaska Air Group expects a smaller-than-expected loss in its first three months. Its shares jumped nearly 5%.
Electronic Arts shares tumbled 17.5% after the company cut its revenue outlook, partly because of fewer gamers playing its soccer-themed video-game titles.
Chip darling Nvidia and other semiconductor shares dropped after one of its main suppliers, South Korea’s SK Hynix, warned of uncertain demand this year for some of its memory products used in smartphones and computers. SK Hynix also gave a cautious spending outlook.
Bitcoin volatility
Bitcoin continued to trade choppily, but was last up 1.21% at $105,044.70 after positive remarks from Goldman Sachs chief executive David Solomon.
Solomon reportedly said at Davos he saw bitcoin as an “interesting speculative asset” and that the cryptocurrency’s “underlying technology” is a focus of significant research at Goldman Sachs to test it in ways that could “create less friction in the financial system.”
Regulation, though, is preventing banks like his to be more active in bitcoin. “At the moment, from a regulatory perspective, we can’t own, we can’t principal, we can’t be involved with bitcoin at all,” he said.
Under Trump, the Securities and Exchange Commission is expected to be crypto-friendly and set new guidelines for crypto.
Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@usatoday.com and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
