The U.S. stock market showed signs of recovery on Thursday, with the S&P 500 posting its first gain in a week, buoyed by an improved market sentiment reflected in the CNN Money Fear and Greed index. While the index remained in the “Greed” zone, a slight increase from the previous day suggests a growing optimism among investors.
Tesla Inc. (TSLA) was the star performer, surging by around 22% after reporting better-than-expected third-quarter earnings. This strong performance overshadowed the decline in International Business Machines Corp. (IBM) shares, which fell by 6.2% after missing third-quarter revenue estimates.
Positive economic data also contributed to the market’s resilience. Initial jobless claims dropped to 227,000 for the week ending October 19, lower than the anticipated 242,000, indicating a robust labor market. The S&P Global flash manufacturing PMI climbed to 47.8 in October, recovering from the 15-month low of 47.3 in September, suggesting a slight improvement in manufacturing activity. The services PMI also rose to 55.3 in October, demonstrating continued growth in the services sector.
Despite the positive overall trend, several sectors within the S&P 500 closed in the red, with materials, industrials, and utilities stocks experiencing the most significant losses. However, the consumer discretionary and communication services sectors bucked the trend and closed higher, contributing to the overall market gain.
The Dow Jones Industrial Average ended the day down by approximately 141 points at 42,374.36. The S&P 500 climbed 0.21% to 5,809.86, while the Nasdaq Composite rose 0.76% to close at 18,415.49. Investors are awaiting earnings results from AutoNation, Inc. (AN), Colgate-Palmolive Company (CL), and HCA Healthcare, Inc. (HCA) later today.
The CNN Business Fear & Greed Index, a measure of market sentiment, currently stands at 63.4, remaining in the “Greed” zone, a slight increase from the previous reading of 62.3. The index is calculated using seven equally weighted indicators and ranges from 0 to 100, with 0 representing extreme fear and 100 indicating extreme greed. A higher reading suggests investors are more optimistic and willing to take on more risk, while a lower reading indicates greater fear and caution in the market.
