The rally in U.S. stocks lost steam on Thursday as Wall Street awaited Friday’s pivotal jobs report. Meanwhile, the crypto market saw heightened activity, with Bitcoin briefly surging to a record high above $103,000 before retreating.
The S&P 500 dipped 0.2% from its record high set the previous day—its 56th this year—marking a modest pullback in what’s shaping up to be one of its best years in decades. The Dow Jones Industrial Average dropped 248 points (0.6%), and the Nasdaq composite edged down 0.2% from its own record.
Bitcoin broke the $100,000 mark for the first time Wednesday night, spurred by news that President-elect Donald Trump selected Paul Atkins, a crypto advocate, as his nominee to lead the SEC. The cryptocurrency, which had rallied from under $70,000 on Election Day, settled at around $99,000 by Thursday, according to CoinDesk.
Bitcoin’s volatility extended to crypto-linked stocks. MicroStrategy, a company heavily invested in Bitcoin, surged 9% in early trading before reversing to a 4.8% loss. Coinbase Global, the crypto exchange, dropped 3.1% after erasing early gains.
In the broader market, airline stocks outperformed after upbeat financial forecasts from major carriers. American Airlines soared 16.8% following its announcement of better-than-expected revenue and profit for the final quarter of 2024. The company also named Citi as its exclusive credit card partner, projecting a 10% annual growth in revenue from co-branded credit cards and partnerships. Southwest Airlines gained 2% after raising its holiday revenue forecast, citing strong demand from leisure travelers.
On the downside, Synopsys fell 12.4% despite reporting stronger-than-expected profits, as its cautious revenue forecast raised concerns about macroeconomic uncertainties. Retailer American Eagle Outfitters plunged 14.3% after warning of “potential choppiness” outside peak shopping periods, echoing similar concerns from Foot Locker earlier in the week. This added to fears about the resilience of U.S. consumers, who are grappling with high prices and a slowing job market.
Consumer spending has been a critical driver of the U.S. economy, helping it sidestep a recession despite aggressive Federal Reserve rate hikes aimed at curbing inflation. However, the outlook remains uncertain as shoppers face mounting challenges.
The week’s focal point for Wall Street is Friday’s U.S. jobs report, which will provide insight into hiring and firing trends. A preliminary report on Thursday showed a slight uptick in unemployment benefit applications, though levels remain historically low.
Markets are betting the Federal Reserve will lower its main interest rate at its upcoming meeting in two weeks. The Fed began easing rates in September after reaching a 20-year high, aiming to support the cooling job market.
In the bond market, the yield on the 10-year Treasury slipped slightly to 4.17% from 4.18% the previous day.
The S&P 500 fell 11.38 points to 6,075.11, the Dow dropped 248.33 points to 44,765.71, and the Nasdaq composite lost 34.86 points to 19,700.26.
Overseas, European markets were mostly steady despite political turmoil in France, where a no-confidence vote led to the resignation of Prime Minister Michel Barnier and his Cabinet. Paris’s CAC 40 index edged up 0.4%.
In Asia, South Korea’s Kospi declined 0.9%, compounding its 1.4% drop from the previous day. Political uncertainty loomed as President Yoon Suk Yeol faced possible impeachment following a brief martial law declaration on Tuesday night, which he later revoked.
Crude oil prices slipped after eight OPEC+ members postponed plans to increase production.
