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U.S. stock indexes opened mostly higher with the Nasdaq Composite COMP soaring 1.7% after Nvidia Corp. NVDA gave stronger-than-expected revenue guidance for its fiscal second quarter, pushing its shares toward all-time highs and propelling the company to the cusp of a $1 trillion market value. Wall Street is also betting on other semiconductor manufacturers with shares of Advanced Micro Devices AMD jumping 9% and Monolithic Power Systems MPWR up 14.2%. The Dow Jones Industrial Average DJIA was off 55 points, or 0.2%, to 32,744, while the S&P 500 SPX advanced 0.7%. The top triple-A credit ratings of the U.S. were placed on "rating watch negative" by credit firm Fitch Ratings Wednesday evening, due to "brinkmanship" in Washington which increases the risk that the country could default on some of its debt and other obligations. In economic data, the number of Americans who applied for unemployment benefits before Memorial Day weekend totaled just 229,000 after Massachusetts took dramatic steps to weed out a massive increase in fraud.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
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In a note released Wednesday, a team of analysts at JPMorgan Chase & Co. said they see the odds of Washington negotiators failing to reach a deal to lift the debt ceiling by early June at "around 25% and rising." Under such a scenario, they said, there's a "very high likelihood" that Treasury would prioritize principal and interest payments, which would avoid a technical default on government debt. Even so, there would "still be several adverse effects, including a likely downgrade of the U.S. credit rating." They also see the so-called X-date, or time when the government is likely to be unable to pay its obligations, as falling between June 1 and June 7. All three major stock indexes were lower in the final hour of trading on Wednesday, with a lack of progress on the debt ceiling weighing down markets.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
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