Market Wrap – Markets digest earnings and jobs data

Stock markets recovered during the US session, with tech stocks posting strong gains. Tesla was amongst the leaders as the electric vehicle makers stock rallied by around 5 percent.

The yield on the benchmark 10-year US Treasury note ticked down 3.59% Thursday morning, while the 2-year exceeded the longer-dated note, reaching the deepest inversion since 1980s.

The dollar index weakened on Thursday against the euro and a basket of other currencies as they clawed back early week losses against the buck.

Disney earnings were also heavily in focus. The world’s largest entertainment company delivered an adjusted earnings per share of $0.99, higher than the Street’s estimates of $0.74 cents per share.

The earnings report showed that Disney lost 2.4 million streaming subscribers. Revenue jumped to $23.5 billion against forecasts of $23.4 billion.

Comments from the Richmond Fed President Waller also seemed hawkish on rates. Just yesterday Kashkari said there is not much evidence that rate hikes so far have had much effect on the labour market.

Waller said that “Inflation is likely past its peak but still elevated” and “It will take longer for pullback in demand to further slow the pace of price increases.”

He also said that “Data continues to push back recession risk” and “While average inflation has peaked, the decline has been distorted by a few goods; median has stayed high.”

Jobs data this afternoon showed the number of Americans filing for unemployment benefits rose to 196,000 in the week ending February 4th, from the previous week’s nine-month low of 183 thousand and above market expectations of 190 thousand.

Still, the latest figure suggested the labour market remained tight, which could contribute further to inflationary pressure in the world’s largest economy. The 4-week moving average, which removes week-to-week volatility, declined to 189.25 thousand, the lowest level since last April.