ASX set to edge up, Wall Street drifts near its all-time high

The US stock market is drifting near its record levels following mixed reactions to profit reports from Macy’s, Marvell Technologies and other companies.

The S&P 500 rose 0.3 per cent and pulled within 0.6 per cent of its all-time high set in late October. The Dow Jones was up 334 points, or 0.7 per cent, in early afternoon trade, and the Nasdaq composite rose 0.1 per cent.

Wall Street is waiting on Nvidia’s results on Thursday (AEDT).Credit: AP

The Australian sharemarket is set to advance, with futures at 5.03am AEDT pointing to a rise of 10 points, or 0.1 per cent, at the open. The ASX added 0.2 per cent on Wednesday. The Australian dollar was trading at US65.97¢ at 5.16am AEDT.

Marvell rose 3.8 per cent after the supplier of semiconductor products delivered a stronger profit for the latest quarter than analysts expected. CEO Matt Murphy credited strong demand for its data centre products, while also announcing a $US3.25 billion ($4.9 billion) purchase of Celestial AI to bolster its artificial-intelligence infrastructure business.

American Eagle Outfitters was another winner and rallied 15.8 per cent after the retailer reported a better profit than expected. Its CEO, Jay Schottenstein, said it also saw a strong start to the holiday shopping season with an acceleration in demand across its brands during the Thanksgiving weekend.

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Macy’s rose 2.3 per cent after reporting a profit for the latest quarter that was much better than the loss that analysts were expecting. The stock came into the day with a rally of 34.1 per cent for the year so far, more than double the S&P 500’s rise.

Outside of earnings reports, Capricor Therapeutics surged 347 per cent after the biotech company reported encouraging results for its potential therapy for people with Duchenne muscular dystrophy.

On the losing end of Wall Street were relatively few companies, including one out of every three stocks in the S&P 500 index. But among them were some of the market’s most influential stocks, which kept indexes in check.

Microsoft fell 1.6 per cent and was the heaviest weight on the S&P 500. Nvidia slipped just 0.6 per cent, but because it’s the most valuable stock on Wall Street, it was another one of the heaviest weights dragging on the index.

CrowdStrike slipped 0.3 per cent despite topping analysts’ expectations for profit. It too came into the day with a big gain for the year so far, raising the stakes, at 51 per cent.

In the bond market, Treasury yields eased after a report suggested US employers outside of the government may have cut more jobs in November than they added.

The data from ADP was much weaker than economists expected, but it has not had a perfect track record predicting what the more comprehensive jobs report from the US government will say each month.

Wednesday’s data may be discouraging for people looking for jobs, but it also keeps alive expectations that the Federal Reserve will cut its main interest rate next week. If the Fed does, that would be the third such cut this year in hopes of bolstering the slowing job market.

A report later in the morning on activity for US services business was more encouraging. It said growth was stronger last month than expected for businesses in the retail, finance, insurance and other industries.

Perhaps just as important was that the Institute for Supply Management’s survey also said prices were increasing at their slowest rate since April. That could help the Fed because fears of high inflation are the main argument against cutting interest rates.

The yield on the 10-year Treasury fell to 4.07 per cent from 4.09 per cent late Tuesday.

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Easing bond yields can boost prices for all kinds of investments, and bitcoin climbed again to top $US92,000 following its scary downward run in recent weeks. It briefly plunged below $US81,000 last month.

In stock markets abroad, indexes were close to flat in Europe following a mixed finish in Asia.

Japan’s Nikkei 225 jumped 1.1 per cent on gains for technology stocks like Tokyo Electron, which jumped 4.7 per cent. SoftBank Group Corp. leaped 6.4 per cent following reports that its founder, Masayoshi Son, regretted having to sell shares in computer chipmaker Nvidia to help pay for other investments.

Chinese indexes sank following the release of data showing weaker factory activity. Stocks fell 1.3 per cent in Hong Kong and 0.5 per cent in Shanghai.

AP

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