WASHINGTON (Alliance News) - Following the pullback seen in the previous session, stocks showed a strong move back to the upside during trading on Thursday. With the rally on the day, the major averages more than offset the losses posted on Wednesday.
The tech-heavy Nasdaq outperformed its counterparts on the day, soaring 107.30 points or 1.4% to a new record closing high of 7,823.92. The Dow jumped 224.74 points or 0.9% to 24,924.89 and the S&P 500 surged up 24.27 points or 0.9% to 2,798.29.
The rebound on Wall Street was partly due to optimism about the upcoming earnings season, with several leading financial companies due to report their quarterly results on Friday.
Easing trade concerns also contributed to the rally after news of US threats of a new 10% tariff on USD200 billion worth of Chinese imports contributed to the weakness on Wednesday.
China vowed to take countermeasures in response to the new tariffs, although the markets responded positively to the lack of an announcement of specific retaliation by the Chinese.
Traders also seem optimistic the continued tariff threats will eventually bring the US and China to the table for talks that could result in a long-term trade agreement.
On the US economic front, the Labor Department released a report showing consumer prices edged slightly higher in the month of June.
The Labor Department said its consumer price index inched up by 0.1% in June after rising by 0.2% in May. Economists had expected consumer prices to increase by 0.2%.
Excluding food and energy prices, core consumer prices rose by 0.2% for the second consecutive month, matching economist estimates.
While consumer prices showed only a modest monthly increase, the annual rate of growth still accelerated to a more than six-year high of 2.9% in June from 2.8% in May.
Core consumer price growth also edged up to 2.3% in June from 2.2% in May, reaching its highest level since January of 2017.
A separate report from the Labor Department showed first-time claims for unemployment benefits fell by more than expected in the week ended July 7th.
The report said initial jobless claims dropped to 214,000, a decrease of 18,000 from the previous week's revised level of 232,000. Economists had expected jobless claims to edge down to 225,000.
Telecom stocks showed a significant rebound on the day, with the NYSE Arca Telecom Index climbing by 1.8% after falling by 1.7% in the previous session.
Considerable strength was also visible among biotechnology stocks, as reflected by the 1.7% gain posted by the NYSE Arca Biotechnology Index. With the advance, the index reached a record closing high.
Computer hardware stocks also turned in a strong performance, driving the NYSE Arca Computer Hardware Index up by 1.6%.
Pharmaceutical, healthcare, and steel stocks also saw notable strength on the day, moving higher along with most of the other major sectors.
In overseas trading, stock markets across the Asia-Pacific region rebounded during trading on Thursday following yesterday's sell-off. Japan's Nikkei 225 Index jumped by 1.2%, while China's Shanghai Composite Index spiked by 2.2%.
The major European markets also moved back to the upside on the day. While the French CAC 40 Index jumped by 1%, the UK's FTSE 100 Index advanced by 0.8% and the German DAX Index climbed by 0.6%.
In the bond market, treasuries saw modest weakness but closed off their worst levels of the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by 1.1 basis points to 2.853%.
Earnings news is likely to move into the spotlight on Friday, with financial giants Citigroup (C), JPMorgan Chase (JPM), and Wells Fargo (WFC) due to report their quarterly results before the start of trading.
The earnings news may overshadow reports on import and export prices and consumer sentiment, although traders are also likely to keep an eye on any further developments regarding trade.
Copyright RTT News/dpa-AFX
Source : http://www.lse.co.uk/AllNews.asp?code=vwpwr5m8679