Wall Street Rises Slightly as Strong Retail Sales and PepsiCo Earnings Boost Market Sentiment

Wall Street posted modest gains on Thursday as encouraging retail sales data and strong earnings from key companies helped buoy investor confidence. The Dow Jones Industrial Average rose by 0.34%, the S&P 500 ticked up 0.09%, and the Nasdaq gained 0.11%. June retail sales surprised analysts with a 0.6% increase, while jobless claims came in lower than expected, signaling continued labor market strength. Analysts interpreted the data as a sign that consumer spending, a critical driver of economic growth, remains resilient.

PepsiCo led corporate performance with a 6.6% surge in share price after reporting robust demand for energy drinks and healthier beverages, despite projecting a modest decline in annual core profit. Meanwhile, U.S. chipmakers gained traction after Taiwan Semiconductor Manufacturing Company (TSMC) reported record profits driven by increasing demand for AI chips. TSMC’s U.S.-listed shares rose 3.2%, while Nvidia and Marvell also posted modest gains.

Sector-wise, consumer staples led the S&P 500 with a 0.6% increase. Netflix shares edged up as investors awaited its quarterly earnings, and United Airlines climbed 3% despite flagging possible third-quarter losses due to disruptions at Newark Airport. The broader market was also monitoring geopolitical developments, including tariff tensions and remarks from President Donald Trump regarding the Federal Reserve.

Markets were briefly rattled on Wednesday following reports that Trump was considering removing Fed Chair Jerome Powell. Though quickly denied, the news revived investor concerns about the Fed’s independence. Fed Governor Adriana Kugler emphasized that no rate cuts are expected in the short term, citing rising consumer prices influenced by Trump-era tariffs. According to CME’s FedWatch tool, traders currently see a 54.3% chance of a rate cut in September.

Looking ahead, global trade uncertainties continue to loom, with a potential wave of new tariffs set to hit on August 1. Trump hinted at progress in trade negotiations with India and Europe, but no concrete deals have been confirmed. On market breadth, advancing stocks outpaced decliners both on the NYSE and Nasdaq, while the S&P 500 and Nasdaq recorded a number of new 52-week highs, reflecting a cautiously optimistic investor outlook.

SOURCE: REUTERS