The S&P 500 bounced back on Thursday, posting its first positive day in a week that has been beset by higher rates.

The S&P 500 added 0.21% to 5,809.86 and snapped a three-day run of losses. The Nasdaq Composite jumped 0.76% and closed at 18,415.49. The Dow Jones Industrial Average lost 140.59 points, or 0.33%, to end at 42,374.36. The blue-chip index notched a four-day losing streak, its first since June.

Tesla was the best-performing stock in the broad market index. The electric vehicle manufacturer surged nearly 22% after posting third-quarter results that beat analysts’ expectations, registering its best day since 2013. Molina Healthcare gained 17.7% on better-than-expected earnings and revenue. Whirlpool and UPS also jumped after posting results.

Dragging the Dow was IBM, which fell more than 6% as the company’s consulting revenue narrowly missed analysts’ estimates. Boeing slipped 1.2% after its machinists rejected a new labor contract.

Roughly 160 S&P 500 companies have posted quarterly results so far, but their earnings growth has been underwhelming. The blended growth rate, which tracks reports that have already come out and estimates for those set to report, indicates an overall S&P 500 earnings growth rate of 3.4% from the year-earlier period, according to FactSet. That result came up short of analysts’ projections.

Treasury yields moved lower, easing from three-month highs reached in the previous session. The 10-year Treasury yield topped the 4.25% threshold on Wednesday at the high of the session.

“The pressure on the market has been from the rate side,” said Rob Haworth, senior investment strategist at U.S. Bank Asset Management. “That’s really what has dampened equity market enthusiasm, and you haven’t had big enough earnings news yet to drive the market to a new high … we’re also not seeing as broad a momentum as we were seeing.”

Stocks are coming off a losing session, with the Dow suffering its biggest one-day drop since early December, falling more than 400 points on Wednesday. The S&P 500 shed nearly 1% and the Nasdaq lost 1.6%.

Southwest Airlines and activist hedge fund Elliott Investment Management struck a deal to avert a proxy fight in exchange for naming six directors to the airline’s board — short of board control — and an earlier retirement for Executive Chairman Gary Kelly. Southwest CEO Bob Jordan will keep his job as part of the deal.

“We are pleased to have come to an agreement with Southwest on the addition of six new directors that will enhance and revitalize its Board,” Elliott’s John Pike and Bobby Xu said in a statement Thursday.

Five of Elliott’s board nominees along with former Chevron CFO Pierre Breber will join the board, which will stand at 13 members, Southwest said.

The Southwest board will appoint a new chairman to replace Kelly, who will now step down next month instead of next year.

Elliott had called for both Kelly and Jordan’s ouster and criticized the airline’s leadership for not moving fast enough on sales- and profit-boosting strategies. The airline has made few changes to its business model in its 50 years of flying and is now planning to upend its long-standing policies like open seating and a single-class cabin for premium seats that more profitable carriers like Delta Air Lines offer.

Southwest’s shares are up less than 1% this year while the S&P 500 has risen 21%. The airline’s third-quarter profit, also announced Thursday, topped analysts’ estimates. Shares in the carrier were down roughly 6% in midday trading.

The Dallas-based carrier has been slashing unprofitable routes to cut costs. At an investor day last month, it said the new revenue initiatives and other changes put it on track to boost earnings before interest and taxes in 2027 by $4 billion. The airline also authorized a $2.5 billion buyback, the first $250 million of which was announced Thursday. 

Elliott and Southwest as recently as last week had been girding for a proxy fight. The activist called for a special meeting in December to vote on its slate of board nominees, which it had trimmed from 10 to eight.

Elliott’s campaign hinged in large part on the removal of Kelly and Jordan from their leadership positions.

With eight new directors joining as a result of the settlement and of Southwest’s earlier board refreshment, the deal is the largest board change Elliott has driven in a U.S. fight.

Southwest’s board said in September it would drop from 15 directors to 12. Thursday’s announcement notches the board back up to 13 members.

Also in September, Southwest said Kelly would step down next spring, but the airline’s board had staunchly backed Jordan. Both Kelly and Jordan have worked at Southwest for more than three decades.

“I believe Southwest’s best days lie ahead under the vision and leadership of Bob Jordan and the oversight of this reconstituted Board,” Kelly said in a release Thursday.

— CNBC’s Leslie Josephs contributed to this report.

Correction: This story has been corrected to remove an inaccurate description for Pierre Breber, who will be joining Southwest’s board. Southwest previously announced its board would drop from 15 directors to 12. An earlier version of this story misstated that announcement.

United Airlines said Tuesday that it is starting a $1.5 billion share buyback as the carrier reported higher-than-expected earnings for the busy summer travel season and forecast strong results for the last three months of the year.

United expects to earn an adjusted $2.50 to $3.00 a share in the fourth quarter, compared to $2.00 a share a year earlier and the $2.68 analysts polled by LSEG estimated.

Here is what United reported for the third quarter compared with what Wall Street expected, based on average estimates compiled by LSEG:

• Earnings per share: $3.33 adjusted vs. $3.17 expected
• Revenue: $14.84 billion vs. $14.78 billion expected

The share buyback would be United’s first since before the Covid-19 pandemic. U.S. airlines received more than $50 billion in government aid during the pandemic travel slump that prohibited share repurchases and dividends, though airlines were still fighting for financial stability.

Southwest Airlines announced a $2.5 billion share repurchase program last month.

“Like other leading airlines and companies, we are initiating a measured, strategic share repurchase program,” United CEO Scott Kirby said in a note to staff on Tuesday. “Importantly, my commitment to you is that investing in our people and our business will always be my top priority even while we institute this share repurchase program.”

For the third quarter, United posted revenue of $14.84 billion, up 2.5% from a year earlier and above analysts’ estimates. It reported net income of $965 million, down 15% from a year ago.

United said domestic unit revenue was positive in August and September compared to last year as airlines trimmed a glut of flights that were pushing down fares. United expanded capacity by 4.1% in the third quarter. The carrier said corporate revenue rose 13% in the quarter; premium revenue, including business class tickets, rose 5%; and sales from its no-frills basic economy tickets were up 20%.

The airline last week unveiled a far-flung expansion for next year that included new flights to Mongolia, Senegal, Spain and Greenland in a chase for international travel demand.

Adjusting for one-time items, United reported earnings per share of $3.33, topping Wall Street forecasts and United’s estimate in July of $2.75 to $3.25 a share.

Airline executives will hold a call with analysts at 10:30 a.m. ET on Wednesday and will likely face questions about demand for the end of the year and into 2025, as well as production problems at Boeing, where most factories have been idled during a more than monthlong machinist strike.

Southwest Airlines is planning to reduce service to and from Atlanta next year, cutting more than 300 pilot and flight attendant positions, according to a company memo seen by CNBC.

The changes come a day before Southwest’s investor day, when executives will map out the company’s plan to cut costs and grow revenue as pressure mounts from activist investor Elliott Investment Management.

Southwest told staff it isn’t closing its crew base in Atlanta. Instead, it will reduce staffing by as many as 200 flight attendants and as many as 140 pilots, for the April 2025 bid month.

The airline also isn’t laying the crews off, but they will likely have to bid to work from other cities.

Southwest will reduce its Atlanta presence to 11 gates next year from 18, according to a separate memo from the pilots’ union.

It will service 21 cities from Atlanta starting next April, down from 37 in March, the carrier said.

“Although we try everything we can before making difficult decisions like this one, we simply cannot afford continued losses and must make this change to help restore our profitability,” Southwest said in its memo. “This decision in no way reflects our Employees’ performance, and we’re proud of the Hospitality and the efforts they have made and will continue to make with our Customers in ATL.”

The unions that represent Southwest’s pilot and flight attendants railed against the airline for the staffing and service cuts.

“Southwest Airlines management is failing Employees while impacting Customers. Management continues to make decisions that lack full transparency, sufficient communication with Union leadership, and most alarmingly, a lack of focus on what has made the airline great, the Employees,” said Bill Bernal, the flight attendants’ union president.

A Southwest spokesman confirmed the changes and said the carrier will “continue to optimize our network to meet customer demand, best utilize our fleet, and maximize revenue opportunities.”

The airline had already pulled out of certain airports, some of which it experimented with during the pandemic to focus on more profitable service.

Southwest is not only facing changing booking patterns and oversupplied parts of the U.S. market but aircraft delays from Boeing, whose yet-to-be-certified 737 Max 7 airplanes are years behind schedule

The airline’s COO, Andrew Watterson, told staff last week that it will have to make “difficult decisions” to boost profits.

The reduction in Atlanta, the world’s busiest airport and Delta Air Lines home hub, is the latest development for the airline. In July, Southwest announced it plans to get rid of open seating and offer extra legroom on its airplanes, the biggest changes in its more than half-century of flying.

Also on Wednesday, Southwest released an expanded schedule, selling tickets through June 4. In addition to the planned cuts in Atlanta, the carrier said it will boost service to and from Nashville, Tennessee. It will also start offering overnight flights from Hawaii, beginning April 8. Those include service from Honolulu to Las Vegas and Phoenix; Kona, Hawaii, to Las Vegas; and Maui, Hawaii, to Las Vegas and Phoenix.