Dow hits 2023 intraday high as stocks aim to cap off best month in more than a year

The small-cap focused Russell 2000
RUT
has risen more than 10% as the beaten-down corner of the market came roaring back, and is on track for its best month since January.

What’s driving markets

The Dow powered higher after the open on Thursday, driven by a more than 8% gain in shares of Salesforce Inc.
CRM,
+6.64%
following a batch of strong quarterly earnings.

At the same time, weakness in other megacap technology names — such as Nvidia Corp.,
NVDA,
-2.93%
Meta Platforms Inc.
META,
-2.32%
and other members of the “Magnificent Seven” — weighed on both the Nasdaq and S&P 500.

See: Salesforce’s stock rises 9% on strong quarterly earnings

In addition to the latest round of corporate earnings, investors also parsed a couple of closely watched economic reports on Thursday. Investors received yet another report showing inflation continued to ease last month. The core personal-consumption-expenditures price index, the Federal Reserve’s preferred gauge of inflation, was up 3.5% year-over-year in October, compared with 3.7% in September.

“…[T]his morning’s PCE print underscores that inflationary pressures continue to moderate to the downside, but the question remains if it will be enough for the Fed to declare a final victory,” said Quincy Krosby, chief global strategist for LPL Financial.

MarketWatch Live: Inflation has cooled further, Fed-favored PCE gauge shows

Meanwhile, jobless claims continued to tick higher, offering more evidence that the U.S. labor market is cooling. Investors will receive a monthly report on job creation from the Labor Department next week.

Initial jobless claims rose 7,000 to 218,000, in the week ending Nov. 25, the Labor Department said Thursday. Economists polled by The Wall Street Journal had estimated new claims would rise 11,000 to 220,000. 

See: Jobless claims tick higher in latest week, reaching highest level in 2 years

Easing price pressures in recent months have helped propel the S&P 500 up more than 8.5% in November, its best month in more than a year and its seventh-best month of the last 20 years, according to FactSet data.

Investors also digested comments from New York Fed President John Williams, the latest in a long line of Fed speakers who have made public comments about the central bank’s monetary policy this week. Williams said the central bank has raised interest rates to or near their peak.

See: Fed’s Williams says interest rates are ‘at, or near’ peak

In other markets, oil futures saw a huge reversal on Thursday after the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, reached an agreement to reduce their monthly overall production by an additional 1 million barrels per day, according to media reports.

News of the agreement initially boosted prices, but they quickly erased all of their gains before falling deep into the red.

See: Oil futures gain as OPEC+ reportedly reaches a deal to cut output by an additional 1 million barrels per day

U.S.-traded West Texas Intermediate crude
CL.1,
-2.88%
futures were down 3.3% at $75.30 a barrel in recent trade. Falling oil prices also weighed on shares of oil and gas companies, with the S&P 500 energy sector down 0.4%, according to FactSet.

But the worst-performing sectors on Thursday were communications services, information technology and consumer discretionary, all weighed down by weakness in the “Mag 7” names.

Companies in focus

• Snowflake Inc.’s
  SNOW,
  +5.07%
  stock rocketed higher after the company delivered upbeat results and an impressive forecast.

• Pure Storage
  PSTG,
  -12.85%
  shares were sharply lower after the enterprise provider of storage services issued disappointing revenue guidance.

• Tesla Inc.
  TSLA,
  -1.58%
  shares are also worth watching as the company is scheduled to host its Cybertruck delivery event on Thursday in Austin, Texas, which is set to begin later in the day.

See: Elon Musk lashes out at advertisers who boycott X: ‘Go f— yourself’