US stocks stage partial rebound from rout

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NEW YORK – Wall Street stocks staged a partial rebound on Thursday (Jan 28) from the prior session’s rout following mixed economic data as shares of GameStop and others continued to gyrate.

The Dow Jones Industrial Average finished up 1 per cent at 30,603.36.

The broad-based S&P 500 also won 1 per cent to 3,787.38, while the tech-rich Composite Index advanced 0.5 per cent to 13,337.16.

Major indices had shed more than 2 per cent on Wednesday due in part to worries about the coronavirus and lofty valuations.

Investors had also been rattled by massive jumps in GameStop, AMC Entertainment and others, but the market applauded new restrictions on these trades by TD Ameritrade and Robinhood, analysts said.

Wednesday’s big fall set the for bargain-hunting on Thursday.

“The restrictions put in place regarding the retail traders by the platforms… (have) helped to calm the market down,” said Quincy Krosby, chief market strategist at Prudential Financial.

“The worry in the market was, if this continue at this pace, it could cause even more damage to the overall market.”

Both GameStop and AMC fell sharply.

The Commerce said the US economy shrunk by 3.5 per cent last year, with the growth of 4 per cent annualised in the fourth quarter moderating from the torrid paces of the second and third quarters.

Other data showed an unexpectedly big drop in new jobless claims.

A plethora of large companies, including Apple, McDonald’s, Comcast and Tesla, reported results.

Most topped expectations, but shares of these companies were mixed.

Among those releasing results were American Airlines, which jumped 9.3 per cent after reporting a smaller-than-expected loss.

Like GameStop and others, American has been targed by short-sellers and was mentioned in a Reddit forum that has been instrumental in this week’s market upheaval.

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