Stocks Soar as the House Passes a Debt-Reduction Agreement

Stocks noticed a rise on Thursday, June 1st following the passage of a bill by the House to raise the debt ceiling. After the passage of the bill, Nasdaq Composite (^IXIC) rose to 1.28%  while Dow Jones Industrial Average (^DJI) rose to 0.47% or 153 points. The S&P 500 (^GSPC) shot to 0.99%.

According to the U.S. debt default, Janet Yellen the Treasury Secretary claimed that stocks have begun to rise in markets over the last week even before Monday. However, with the House passing the bill in a resounding 314-117 vote, investors are patiently waiting for the outcome in the Senate.

“The deadline to raise the debt ceiling is rapidly approaching, and the likelihood of triggering a negative market reaction with severe economic consequences will only increase as we approach the precipice,” CEO of Business Roundtable, Joshua Bolten said after the House vote on Thursday.

“We call on the Senate to eliminate the threat of a default by passing this bipartisan bill as soon as possible,” he added. 

After the market closed on Wednesday, the Nasdaq index reversed its rise that had been driven by artificial intelligence confidence following Nvidia's (NVDA) massive earnings report last week. After reporting a lower-than-expected full-year sales forecast, C3.ai (AI) shares dropped 13% on Thursday. Revenue is expected to be between $295 and $320 million for the artificial intelligence software maker. According to S&P Global Market Intelligence, Wall Street expected $321 million.

CrowdStrike (CRWD) and Salesforce (CRM) shares also declined. Investors focused on Salesforce's quarterly capital expenditure growth of 36%, causing the stock to drop 4.66%. CrowdStrike stock dropped 1.6% after the company predicted lower-than-expected profits for the year.

At the same time, data on consumer spending from retail sales have remained unclear. After the market closed on Wednesday, Nordstrom (JWN) beat analyst forecasts, sending its stock up 4.77 percent on Thursday. However, Macy's (M) set a different tone on Thursday morning. Even though the store lowered its full-year sales and EPS guidance, its stock price increased by 1.2%.

"We planned the year assuming that the economic health of the consumer would be challenged, but starting in late March, demand trends weakened further in our discretionary categories, "Macy's chairman and CEO Jeff Gennette said in the company's earnings release.