Stocks close higher, Dow gains 300 points as Fed’s Bostic spurs relief rally: Live updates

The modest rally for stocks is being led in part by utilities, with the Utilities Select Sector SPDR Fund (XLU) up 1.7%.

Nextera Energy, the biggest holding in the fund, has jumped more than 3% on the day. Duke Energy and Southern have each added about 1.9%.

Thursday's gains came despite the 10-year Treasury yield climbing well above the 4% level. Utility stocks tend to struggle when rates are high, given their own debt load and the fact that it makes their own dividend yields less attractive relative to bonds.

The move represents a mild reversal for the sector, as the XLU ETF is still down about 8% for the year.

— Jesse Pound

Credit-default swap (CDS) trading on U.S. Treasury bonds has picked up since January, with implied default probabilities increasing "to levels not seen since the 2013 debt-ceiling debate," MSCI researchers Andras Rokob and Andy Sparks wrote in a blog post Thursday.

CDS spreads have widened out in 2023, echoing similar moves in both 2011 and 2013, during two other episodes that saw battles between Congress and the White House over raising the U.S. debt ceiling, the researchers wrote.

"Assuming a 95% recovery, the CDS market's one-year implied default probability was 11.3%, as of Feb. 24, up significantly from the 3.3% probability prevailing at the beginning of the year," MSCI said. "The consequences of a potential default by the U.S. government extend beyond the immediate impact on holders of Treasurys," Rokob and Sparks warned. "Major market dislocation and a sharp slowdown in economic activity could both be realistic possibilities."

— Scott Schnipper; CNBC's Jeff Cox contributed to this report

Jenny Harrington, CEO at Gilman Hill Asset Management, is ditching shares of Foot Locker in the wake of its recent outperformance.

She told CNBC's "Halftime Report" on Thursday that after the runup in shares, the company no longer offers the greater than 5% dividend yield needed for her portfolio's target.

"I have a lot of things on the shortlist that I could buy that have a higher yield and more upside potential from here," she said. "So I sold Foot Locker. I'll take my profits on that. I'll sit in cash until what I'm looking at gets a little cheaper."

For similar reasons, Harrington also sold workplace benefits company Unum Group, which she added in May 2020.

"This is still super cheap," she said, noting that the dividend yield now sits under 3%. "If you don't need the dividend yield, you can continue to hold Unum all day long, because they actually benefit from a higher interest rate environment."

— Samantha Subin

Third Point's Dan Loeb has taken a passive stake in chipmaker AMD, sources told CNBC's Scott Wapner.

Shares of AMD jumped 3% in Thursday's afternoon trading following the news.

The hedge fund manager took the bet when AMD shares struggled, according to sources. AMD shares have underperformed the rest of the sector over the last 12 months, down more than 30% as the PHLX Semiconductor Index declined 14%.

The stock has bounced back this year by 24% as China opened up its economy and the overall stock market has rebounded.

— Yun Li

Many on Wall Street remained bullish on Snowflake despite an earnings report that prompted a sell off.

Snowflake beat expectations on the top and bottom lines of analysts polled by Refinitiv. But investors took pause after it reported guidance for the current quarter was weaker than analysts had anticipated going into the report. The stock was down more than 13% midday in Thursday's session.

Yet analysts were not jolted to the same extent. While noting a slower ramp-up speed than previously expected, analysts at JPMorgan, Citi, Goldman Sachs, Barclays, Deutsche Bank and Morgan Stanley still held buy or overweight ratings following the report. But some did lower their price targets as a result.

"SNOW's Q4 print should result in estimate revisions; hence, shares will likely suffer in the short-term," said Barclays analyst Raimo Lenschow in a note to clients Thursday.

Goldman Sachs analyst Kash Rangan said that while the slower timeline for gaining share among younger customers came as a surprise, he remained optimistic about the company because of the increasingly de-risked product revenue, its free cash flow margin expansion and "best-in-class" software asset.

Duetsche Bank analyst Brad Zelnick, however, noted that the company's results show it's "not immune from cloud growth moderation."

— Alex Harring

JPMorgan downgraded Dollar Tree to neutral from overweight on Thursday, a day after the discount retailer gave first-quarter EPS guidance and fiscal-year revenue that fell short of Wall Street's expectations.

Dollar Tree's fourth-quarter EPS of $2.04 topped StreetAccount's estimate of $2.02, while revenue of $7.72 billion also beat estimates of $7.61. Its same-store sales growth was 8.7%, driven by a 10% increase in the average ticket and partially offset by a 1.1% decline in traffic, JPMorgan analyst Matthew Boss pointed out in a note to clients.

"Digging deeper, management cited 'multiple moving parts and noise in the last 30-45 days of the quarter' citing Omicron a year ago with forward looking 'caution' tied to an uncertain macroeconomic environment and anniversary of stimulus/fiscal in the marketplace over the past few years," he wrote.

Multi-year, however, he sees Dollar Tree "returning to a double-digit EPS 'compounder' with top- and bottom-line drivers in place at the core DT banner (with DT Plus roll-out incremental) and stabilization at the Family Dollar concept."

Shares of Dollar Tree were down more than 2% in midday trading.

— Michelle Fox

Atlanta Federal Reserve President Raphael Bostic said he thinks the central bank can stick with quarter-point interest rate hikes.

"I am still very much of a mindset that slow and steady is going to be the appropriate course of action," Bostic told media members. He added that he favors rate hikes of 0.25 percentage point, a step down the Fed took at its meeting a month ago.

"Right now I'm still in very firmly in the quarter point move pacing," he added.

Some other Fed officials have said they are open to hiking by half a point when they meet later this month. Market pricing currently points to that move, though the probability for a half-point increase has risen in recent days.

—Jeff Cox

Many on Wall Street were unmoved by Tesla's investor presentation on Wednesday even as the stock took a leg down.

CEO Elon Musk presented the third installment of his "Master Plan." Musk and other executives reiterated the goal of producing 20 million electric vehicles per year by 2030, which would mean a more than 15-fold increase from the 1.31 million delivered in 2022. He also shared plans to build more car and battery cell production plants, while increasing output at already existing locations.

Wall Street analysts largely agreed that the plan gave a long-term vision for the company, but they said it lacked specifics on how the electric vehicle giant would get there. Still, many held the ratings they had on the stock heading into the meeting.

"Walking away from Tesla's investor day, we were admittedly disappointed with the overall lack of details on its next-gen platform," Deutsche Bank analyst Emmanuel Rosner said in a Thursday note to clients.

Meanwhile, investors sold off following the call. The stock was down after hours Wednesday and during Thursday's session.

CNBC Pro subscribers can read what all the major analysts had to say here.

— Alex Harring

In a world where defense spending is expected to grow, some "Halftime Report" investment committee members revealed how they plan to play the sector.

Ritholtz Wealth Management's Josh Brown, for example, told CNBC's "Halftime Report" on Thursday that he owns the iShares U.S. Aerospace & Defense ETF. The fund's up 4% this year and includes names like Raytheon Technologies, TransDigm and Boeing.

"Budgets are going higher, and these are the companies that are direct beneficiaries," Brown said, calling the industry one of the "very few guaranteed secular bull markets" right now. "These are the best run, largest aerospace and defense companies, all in one ticker," and at a relatively low cost.

Like Brown, Cerity Partners' Jim Lebenthal is betting on the industry through Raytheon Technologies, and he's considering adding to that position. He told "Halftime Report" that he likes the company's "hybrid nature" defense and commercial aerospace businesses.

Lebenthal is also keeping an eye on Northop Grumman and Lockheed Martin as potential buys near term.

"This is a sad story, but the truth is defense budgets are going up around the world, " he said. "... I hate what I'm saying, but it's just the simple truth and it's not going to change anytime soon. So, this is a growth industry for the next few years."

— Samantha Subin

The Federal Reserve should go back to higher interest rate increases at its next meeting, economist Mohamed El-Erian told CNBC on Thursday.

"If they are truly data-dependent, then they should go back to 50" basis points, El-Erian, the Allianz chief economic advisor, said on CNBC's "Squawk Box."

At its last meeting, the central bank raised its benchmark interest rate 25 basis points, or 0.25 percentage points. That was a step down from the previous increase of 50 basis points, which itself followed four consecutive 75 basis point hikes.

With markets expecting another 25 basis point move at the meeting later this month, El-Erian noted that the Fed faces a tough choice either way.

"If you stick to 25 and go higher for longer, which is the alternative, you risk hiking into a slowing economy and you undermine your credibility even more," he said. "It's the tragedy of the second-best. The further you are away from the right policy response, which they fell behind on, the more that whatever you do has collateral damage and unintended consequences."

—Jeff Cox

The three major indexes showed a mix bag for stocks as investors entered the second half of the trading day.

The Nasdaq Composite led the way down, dropping 0.5%.

The S&P 500 followed with 0.2% down. The broad index was pulled down by the consumer discretionary and financial sectors, which were each down more than 1%.

The Dow was able to buck the trend, up around 100 points, or 0.3%. A pop in Salesforce on the back of earnings and future guidance helped the 30-stock average stay above the flatline.

— Alex Harring

Check out the companies making headlines in midday trading.

Salesforce — Shares of the cloud software maker surged more than 10% after the company beat Wall Street estimates across the board in its quarterly report and issued a better-than-expected forecast. Salesforce also said it is expanding its share buyback program after introducing it last year. Wall Street analysts believe Salesforce's strong results are impressive given the activist pressure it's facing.

Macy's — Macy's gained 9% after reporting fourth-quarter results. The retailer posted $1.71 in earnings per share, above the $1.57 anticipated by analysts polled by Refinitiv. Revenue came in line with Wall Street expectations at $8.26 billion.

Tesla — The electric-vehicle maker's shares lost 6% after Tesla's investor day, which some believed lacked specifics.

See the full list here.

— Hakyung Kim

Now that the 10-year Treasury yield has broken above the 4% psychological barrier, it should continue to move higher, according to Credit Suisse.

"This should open up a deeper rise within what we now expect to be an even broader range. Next supports are seen at 4.11%, then the 4.325% October high," analyst David Sneddon wrote in a note Thursday.

The yield on the benchmark 10-year was last up nearly 8 basis points to 4.073%.

—Michelle Fox

Regional bank stocks, as reflected in the SPDR S&P Regional Banking ETF (KRE), fell as much as 2.9% intraday Thursday, on pace for the worst day since mid-January. The regionals were caught in the downdraft from crypto-related banks Silvergate Capital (SI) down as much as 50% intraday, and Signature Bank (SBNY) down as much as 5.9%.

KRE is now on track for a fourth successive declining session, and is off about 3.2% week-to-date, which would be its worst week since mid-December.

Signature Bank is trading at the lowest since November 2020.

Also weighing on the group are potential commercial real estate exposure as office real estate values are questioned and benchmark interest rates rise, threatening REITs with higher cap rates.

Hudson Pacific Properties (HPP) fell Thursday to a record low, going back to its 2010 IPO, Steve Roth's Vornado Realty Trust (VNO) touched its lowest point since 1998, JBG Smith Properties (JBGS) also fell to the lowest since its 2017 IPO and Kilroy Realty (KRC) dropped to its lowest since 2011.

— Gina Francolla, Christopher Hayes, Scott Schnipper

The S&P 500 has been flirting with its 200-day moving average, and a drop below that level could signal more selling.

The 200-day was at about 3,940 Thursday, and the index fell below that level but recovered Wednesday. The S&P 500 was trading near that level Thursday morning.

The 200-day is literally the average of the last 200 closing prices, and it is viewed as a momentum indicator for a stock or index. Stock chart analysts would view it as a negative signal if the index were to close below that level and stay below it.

—Patti Domm

The S&P 500 and Nasdaq Composite opened lower on Thursday, falling 0.5% and 0.8%, respectively, to start the day.

The Dow Jones Industrial Average, however, rose 53 points, or 0.1%.

— Tanaya Macheel

The amount that businesses end up paying workers for output jumped in the fourth quarter, fueling the idea that inflation is still a problem for the U.S. economy.

Unit labor costs jumped 3.2% for the October to December period, the Labor Department reported Thursday. That was well above the Dow Jones estimate for a 1.6% increase.

The increase came from a 4.9% rise in hourly compensation, minus the 1.7% increase in productivity, which was below the 2.5% estimate.

In other economic news, jobless claims fell to 190,000 for the week ended Feb. 18, down 2,000 from the previous period and below the estimate for 195,000. Continuing claims fell to 1.655 million, down 5,000.

Both data points indicate the Federal Reserve likely is on track to increase its benchmark interest rate at least another 0.25 percentage point when it meets later this month.

—Jeff Cox

These are some of the stocks making the biggest moves before the bell:

• Salesforce — Shares of the cloud software stock soared nearly 16% in premarket after the company beat Wall Street estimates across the board in its latest earnings report and issued a better-than-expected forecast. Salesforce also said it is expanding its share buyback program.
• Best Buy — The consumer electronics retailer shed 1.9% after its fiscal year earnings and revenue guidance came in lighter than expected. However, its quarterly earnings beat estimates.
• Macy's — The retailer advanced 7.3% after beating expectations on per-share earnings and meeting them on revenue, according to Refinitiv.

See the full list here.

— Alex Harring

Shares of Silvergate Capital tumbled more than 43% in premarket trading after the company, which provides banking services to crypto businesses, filed to delay its 10-K annual report.

On Thursday morning the stock received two downgrades. JPMorgan cut its rating to underperform and warned it may not meet its financial obligations without liquidating.

Canaccord Genuity downgraded Silvergate to a hold. The company has been managed well but it wants to see the dust from recent filings settle.

Silvergate shares are now down 22% in 2023. Earlier this year, they suffered another 40% drop after the bank reported massive withdrawals in the fourth quarter in light of the FTX collapse.

— Tanaya Macheel

Tesla shares fell 6% in premarket trading following a disappointing investor day where the company failed to unveil any concrete details on its next-generation vehicles.

"At the Investor Day, TSLA targeted a 50% cost reduction for its next gen model," wrote Wells Fargo analyst Colin Langan. "However, the timeline and cost details were limited, and the event lacked a TSLA-like surprise. With high expectations, we expect the stock to trade down."

Langan's report was titled, "TSLA Investor Day: Got the What, but Missing the When & How."

Tesla is a popular stock with retail investors and is an overall barometer on risk-taking in the market. A loss today could weigh on the broader market.

— John Melloy

The recent market sell-off puts the S&P 500 in danger to break below a key chart level, according to a note from JPMorgan's trading desk.

"The S&P 500 Index slide from anticipated resistance in the 4100s threatens key chart levels surrounding 3900," the note said. "A move through that support has the strong potential to accelerate bearish price pressures, in our view."

The S&P 500 closed at 3,951.39 on Wednesday. Over the past month, the broader market index is down 5.5%.

"Even after the recent setback, the S&P 500 Index still looks overvalued relative to the shape of the money market curve," the JPMorgan note said. "An 18-month relationship that uses the expected terminal rate and overall amount of easing priced after terminal rate is achieved currently shows the index fair value just below 3800."

— Fred Imbert, Michael Bloom

Nio shares fell 1% in the premarket after JPMorgan downgraded the electric vehicle maker to neutral from overweight.

"Whilst management at the result call attributed most of the miss to a one-off item related to clearance of old models (ie ES6, ES8 and EC6 before new models on new platform arrive in 1H23), our concern is that 1Q23 margin could trend down further (JPMe vehicle GPM about 5%) while the magnitude of improvement from 2Q23 will be shy of street expectation, considering a challenging competition environment," JPMorgan said.

"On top of that, we note our 2023 delivery forecast (190k units or 56% growth) is below management's ambitious target (240- 250k, doubling from 122 in 2022)," the bank added.

— Sarah Min

Shares of Tesla fell about 3% after the bell as the electric vehicle maker held its 2023 Investor Day.

During the event, hosted in Texas, CEO Elon Musk unveiled his "Master Plan 3," focusing heavily on sustainable energy, but sharing few details.

Investors and analysts alike are monitoring the event for insight into how the company plans to grapple with increasing competition.

— Samantha Subin, Lora Kolodny

The crypto-focused bank's stock plummeted more than 30% in overnight trading after it filed to delay the release of its 10-K.

Silvergate Capital said in a filing Wednesday that it's evaluating a string of pending inquires and investigation and needs more time to "complete management's evaluation of internal controls over financial reporting."

Given this recent string of events, the company also said in the filing that it may be "less than well-capitalized."

Silvergate Capital shares have come under pressure in recent months as it grapples with the fallout from the collapse of crypto-exchange FTX.

— Samantha Subin

Along with Salesforce, a slew of technology stocks moved in overnight trading after reporting earnings.

Snowflake shares fell more than 7% on lighter-than-expected product revenue guidance, despite posting a top-and-bottom line beat for the recent quarter, according to Refinitiv.

Meanwhile, Okta's stock jumped 14% on a top-and-bottom line beat. The identity management company also shared strong revenue and EPS guidance for the current period, including an unexpected profit.

Outside of tech, shares of American Eagle Outfitters jumped about 7% on strong quarterly results.

Read the full list of stocks moving after the bell here.

— Samantha Subin

Salesforce's stock popped more than 15% in overnight trading after posting better-than-expected fourth-quarter results and strong guidance for the year ahead.

The cloud software company reported adjusted earnings per share of $1.68 on revenue of $8.38 billion. Analysts surveyed by Refinitiv had called for EPS of $1.36 on $7.99 billion in revenue.

Salesforce also said it's expanding its share buyback program to $20 billion.

— Samantha Subin, Jordan Novet

Stock futures opened higher Wednesday evening.

Futures tied to the Dow gained 148 points, or 0.45%. S&P 500 futures and Nasdaq 100 futures added 0.08% each.

— Samantha Subin