U.S. stock rose, with the Dow Jones gaining after four straight days of declines and the Nasdaq’s slide into correction territory. Jobless claims rose more than expected.

The Nasdaq at yesterday’s close was down more than 10% from its recent high as investors worried about the Fed tightening monetary policy and higher Treasury yields. The Dow Jones Industrial Average (DJIA) fell for the fourth day in a row, down 0.9%. The S&P 500 also fell nearly 1%. The yield on the 10-year Treasury note fell after yesterday hitting a high of 1.9%.

Key Takeaways

  • U.S. stock rose in early trading on Thursday, Jan. 20, with the Dow Jones gaining after four straight days of declines and the Nasdaq having slid into correction territory.
  • Jobless claims rose more than expected to 286,000 for the week ended Jan. 15.
  • American Airlines’ fourth quarter earnings beat estimates, while oilfield services company Baker Hughes missed. Travelers profit also topped estimates. CSX and Netflix report earnings later today.

The Labor Department reported initial jobless claims in the U.S. rose to 286,000 for the week ended Jan. 15, an increase of 55,000 from the previous week’s revised 231,000. Economists had been expecting a decline to 225,000.

U.S. Department of Labor

American Airlines Group Inc. (AAL) beat estimates in its fourth quarter earnings report, while oilfield services company Baker Hughes Company (BKR) missed. Profit posted by The Travelers Companies, Inc. (TRV) also topped estimates. CSX Corporation (CSX) and Netflix, Inc. (NFLX) report earnings later today.

Shares of United Airlines Holdings, Inc. (UAL) fell about 2.5% yesterday after the company reported its quarterly results and warned that omicron had hurt its bookings and will delay its pandemic recovery.

Oil prices slipped after passing $87 per barrel yesterday, highs last seen in 2014. Major cryptocurrencies gained. The dollar slid against the euro. 

In Asia, China cut its benchmark lending rates amid concerns about an economic slowdown in the world’s second largest economy by GDP. The Hang Seng index jumped over 3% on the news. Stocks in Europe edged lower.

Later this morning, the National Association of Realtors will report existing home sales for December. Economists forecast a seasonally adjusted annual rate of 6.4 million existing homes sold, slightly less than in November. The median existing home sold for a record $353,900 in November, up 13% year over year.

Today’s Headlines: Quick Hits

Netflix is expected to post a rise in fourth quarter revenue on steady subscriber growth during the holiday season, powered by popular titles like Don’t Look Up and The Power of the Dog, as well as the latest seasons of The Witcher and Emily in Paris, while monthly fees are expected to increase.

Starbucks Corporation (SBUX) suspended COVID-19 vaccine requirements for U.S. employees, after the Supreme Court ruled against the Biden administration’s vaccine-or-test mandate for large employers.

Amazon.com, Inc. (AMZN) is launching its first retail apparel store. Called “Amazon Style,” the first location will be in the Los Angeles suburb of Glendale, California, and open later this year.

Meta Platform, Inc.’s (FB) Instagram is testing a subscription service that allows users to pay for extra content from creators. Price tiers will range from $0.99 to $99.99 for the exclusive content.

The Walt Disney Company (DIS) said it will form a new hub for international content creation. The changes come amid slowing subscriber growth for the Disney+ service.

BetMGM raised its 2022 revenue forecast to more than $1.3 billion from $1 billion and said it expects to post a profit for 2023. The U.S. sports-betting venture between MGM Resorts International (MGM) and Britain’s Entain PLC (GMVHY) is gaining market share in line with its long-term growth target of 20% to 25% in U.S. sports betting.

Walmart Enters the Metaverse: The Big Story

Walmart Inc. (WMT) is preparing a push into the metaverse, according to filings. The retail giant filed seven trademarks at the end of December that signal its plans to make and sell virtual goods in the metaverse. According to one of those filing, Walmart is also exploring whether to offer users a cryptocurrency along with non-fungible tokens (NFTs). The retailer plans on making and selling virtual goods that include electronics, home decorations, toys, sporting gods, and personal care products.

Businesses have been rushing to develop virtual products. Nike, Inc. (NKE) filed a number of trademark applications that previewed its plans to sell virtual branded sneakers and apparel. It said it will team up with Roblox Corporation (RBLX) later this month and create an online world called “Nikeland.” Last month, Nike had announced its purchase of the virtual sneaker company RTFKT for an undisclosed amount.

The Gap, Inc. (GAP) has also started selling NFTs of its logo sweatshirts. The apparel maker said that its NFTs will be priced ranging from roughly $8 to over $400.