by Sinéad Carew and Bansari Mayur Kamdar
(Reuters) – The New York Stock Exchange ended higher on Thursday, driven by technology stocks and high-growth stocks, with the S&P-500 climbing to a record closing amid heightened optimism about a decline in interest rate after comments from the chairman of the Federal Reserve (Fed).
The Dow Jones index gained 0.34%, or 130.30 points, to 38,791.35 points.
The broader S&P-500 gained 52.60 points, or 1.03%, to 5,157.36 points.
The Nasdaq Composite advanced 241.83 points (1.51%) to 16,273.38 points.
The Nasdaq also came close to a closing record. While it had established itself at a historic peak during the session, like the S&P-500, it finally saw part of its gains erased.
Heard again during the day in the American Congress, the head of the Fed, Jerome Powell, declared that the American central bank was “not far” from having sufficient confidence in the decline of inflation towards 2% target to start lowering rates.
These comments reinforced investors’ hopes that the Fed would make a shift in its monetary policy in June, a prospect that caused the main Wall Street indexes to rebound from the low experienced earlier this week due to a certain tension before the start of Powell’s hearings before parliamentary committees on Wednesday.
Data released today showed that the number of weekly jobless claims in the United States remained stable, confirming that the labor market continues to soften. They came on the heels of other jobs reports this week that suggested the market was less tight but remained strong.
Summarizing Jerome Powell’s statements to lawmakers, Anthony Saglimbene, chief market strategist at Ameriprise Financial, said the Fed chairman “left rate cuts on the table this year. That was what the market wanted to hear.
“The market has also reacted well to the employment data released so far this week,” he added. “This reinforces the thesis of a labor market which is slowing but which remains solid.”
However, he noted that investors were anxiously awaiting the monthly employment report, scheduled for Friday, to have additional information.
An element also highlighted by Chris Larkin, investment director at E*TRADE of Morgan Stanley. “Confidence could quickly evaporate” if Friday’s report were to “not point in the same direction” as the other data, he said.
Nine of the eleven major sectors of the S&P-500 ended the session in the green, led by communications services and information technology, both up more than 1.8%.
High-growth stocks were among the session’s catalysts, with Meta gaining 3.2% while Nvidia rose 4.5%.
Also note the 29.7% fall in Victoria’s Secret following disappointing annual forecasts.
(Written by Jean Terzian)
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