U.S. stocks closed mixed on Thursday (February 6), as investors temporarily ignored the Trump administration's tariff policies and focused on the upcoming non-farm payrolls data. The Dow Jones Industrial Average fell 125.65 points, closing at 44,747.63, a decrease of 0.28%; the Nasdaq Composite Index rose 99.66 points, ending at 19,791.99, up 0.51%; and the S&P 500 Index increased by 22.09 points, closing at 6,083.57, up 0.36%.
On the same day, the market saw a batch of the latest corporate earnings reports, which overall showed a weak performance. Particularly in the tech sector, reports from Qualcomm, Arm, and Skyworks Solutions disappointed the market. Ford Motor Company’s stock price dropped more than 7% as the company forecast difficulties in 2025. Additionally, Honeywell’s stock also fell by 5.6% due to its full-year earnings guidance falling short of analysts' expectations.
The impact of Trump's tariff policies temporarily weakened in the market. Last weekend, Trump announced additional tariffs on imports from Canada, Mexico, and China, causing market concerns. However, after Trump announced on Monday a delay in tariffs on Mexico and Canada, market sentiment improved. Investors began to focus more on corporate earnings, with many believing that corporate earnings prospects remain optimistic. Ed Yardeni, president of Yardeni Research, stated, "The market is gradually accepting that the impact of tariff policies will pass, and corporate earnings prospects remain strong."
In economic data, the U.S. Department of Labor released the latest unemployment claims data. It showed that initial jobless claims rose by 11,000 last week, reaching 219,000, slightly above expectations. Although unemployment claims increased, they remain at relatively moderate levels. ADP Research's employment data indicated that the pace of hiring in the U.S. private sector was stable in January, which aligns with Federal Reserve Chairman Powell's description last week of the job market as "fairly stable."
Furthermore, the U.S. Bureau of Labor Statistics released the fourth-quarter productivity report, showing that productivity, measured as output per hour for nonfarm businesses, grew at an annual rate of 1.2%, revised from 2.3% in the third quarter. Although productivity growth slowed, it remains at a relatively high level, offering support for the Federal Reserve in dealing with rising labor costs. The report also indicated that unit labor costs increased by 3% in the fourth quarter, higher than the 0.5% growth in the previous quarter.
Federal Reserve officials continue to monitor tariff policies, inflation, and their impact on the economy. Federal Reserve Vice Chairman Philip Jefferson mentioned that the current U.S. labor market is solid, but the path to lower inflation remains challenging. Chicago Fed President Austan Goolsbee also noted that while the uncertainty of fiscal policy may reduce the number of rate cuts, interest rates are expected to be lowered over the next 18 months.
On the international central bank front, the Bank of England announced on Thursday a 25 basis point cut to its benchmark interest rate, bringing it to 4.5%. Analysts suggest that the risks facing UK economic growth might prompt the central bank to ease further, with more rate cuts expected in the future.
