Tech stocks experienced a significant rebound at the opening of Thursday's session, driven by a sharper-than-expected decline in weekly jobless claims, which eased fears of imminent recession-like conditions in the U.S.
The Nasdaq 100 index, tracked through the Invesco QQQ Trust QQQ, surged 2.4% by 10:30 a.m. in New York. This rally puts the index on track to end a five-session losing streak, the longest for the tech-heavy index since December 2022.
Within tech industries, chipmakers outperformed, with the VanEck Semiconductor ETF SMH up 4.3%.
Initial jobless claims fell to 233,000 for the week ending Aug. 3, a decrease of 17,000 from the previous high of 250,000, and below market expectations of 240,000.
The four-week moving average, which smooths out week-to-week volatility in jobless claims, rose by 2,500 to 240,750, the highest in about a year. The outstanding claims increased by 6,000 to 1,875,000 for the week ending July 27, the highest since November 2021.
Analysts React To Unemployment Data
This unexpected drop in jobless claims provided a breath of fresh air for the market, propelling tech stocks upward and calming recession fears, at least for the moment.
"Some good news this morning with jobless claims coming in less than expected," said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. It’s hard to believe a recession has already begun, and “the panic that started earlier in the month was overblown, he said.
Ed Yardeni, president of Yardeni Research, echoed this sentiment, stating the decline in weekly jobless claims "should help to relieve fears that an employment-led recession is underway."
Traders adjusted their expectations for a 50-basis-point cut in September, with market-implied probabilities of such an outcome falling to 54%, down from 70% earlier this morning and nearly 100% following last Friday's weak labor market report.
The policy-sensitive two-year Treasury yield rose by 9 basis points to 4.06%, after hitting a level as low as 3.65% on Monday.
Nasdaq 100 Movers On Thursday
Leading the gains among Nasdaq 100 constituents were:
| Name | 1-day %chg |
| ON Semiconductor Corporation ON | 7.13% |
| Arm Holdings plc ARM | 6.52 |
| Datadog, Inc. DDOG | 6.08 |
| Marvell Technology, Inc. MRVL | 5.74 |
| Cadence Design Systems, Inc. CDNS | 5.65 |
The major contributors to the broader tech index surge were:
| Name | Weight | 1-day %chg | Percentage-point (pp) contribution |
| NVIDIA Corporation NVDA | 6.95% | 3.23% | +0.22pp |
| Broadcom Inc. AVGO | 4.66 | 4.73 | + 0.22pp |
| Microsoft Corporation MSFT | 8.46 | 1.68 | +0.14pp |
| Meta Platforms, Inc. META | 4.87 | 2.84 | +0.14pp |
| Apple Inc. AAPL | 9.19 | 1.22 | +0.11pp |
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