Wall Street rises to pull S&P 500 back nearly to record high
U.S. stocks rose Thursday to pull the Standard & Poor’s 500 index back within 1% of its record after a rough April.
The S&P 500 rose 26.41 points, or 0.5%, to 5,214.08. The Dow Jones industrial average gained 331.37 points, or 0.8%, to 39,387.76, and the Nasdaq composite added 43.51 points, or 0.3%, to close at 16,346.26.
A report showing a pickup in layoffs helped to support the market. The number of workers applying for unemployment benefits rose by more last week than economists expected, though it remains relatively low compared with history.
That could be a sign that the economy can pull off a hoped-for balancing act of staying solid enough to avoid a bad recession, but not so strong that it puts upward pressure on inflation. Treasury yields erased earlier gains immediately after the report’s release, an indication of expectations for the Federal Reserve to deliver long-sought cuts to interest rates later this year.
Elsewhere on Wall Street, some stocks swung sharply after their latest earnings reports.
Equinix jumped 11.5% after reporting stronger profit for the latest quarter than analysts expected. The company, which runs data centers around the world, also said an independent investigation led by its board found no accounting inconsistencies or errors that would require financial restatements. Earlier, an investment firm had accused it of “major accounting manipulation.”
Yeti Holdings rose 12.8% after reporting better-than-expected profit for the latest quarter , thanks to stronger sales for its drink-ware, coolers and equipment. It also raised its forecast for full-year earnings per share. Like other companies, it’s plowing cash into buying back its own stock, which boosts per-share profit for existing investors.
Cheesecake Factory gained 6.2% after topping profit expectations . The results were encouraging after some recent warnings by big food and drink companies about how much pressure their customers, particularly lower-income ones, are feeling.
Airbnb sank 6.9% despite topping expectations for profit and revenue. It said an earlier Easter pulled more of its business this year into the first quarter from the second quarter.
Beyond Meat, the maker of plant-based meat substitutes, fell 14.4% after it posted a much worse loss than analysts expected as demand continued to crater.
In the bond market, the yield on the 10-year Treasury eased to 4.45% from 4.50% late Wednesday. The two-year yield, which more closely tracks expectations for the Fed, slipped to 4.81% from 4.84% late Wednesday.
A smooth auction of 30-year Treasury bonds helped to keep yields stable.
Treasury yields have largely been easing since Federal Reserve Chair Jerome H. Powell said last week that the central bank remains closer to cutting its main interest rate than raising it, despite a string of stubbornly high readings on inflation this year. A cooler-than-expected jobs report Friday, meanwhile, suggested that the U.S. economy could manage to avoid being either too hot or too cold.
It could take awhile for inflation in the United States to cool all the way back to the Fed‘s target, even with its main interest rate at its highest level in more than two decades. Economists at S&P Global Market Intelligence slightly downgraded their forecasts for U.S. economic growth in 2025 and 2026, which they said could allow inflation to settle at the Fed’s target on a sustained basis by 2027.
In stock markets abroad, indexes rose in London and other markets in Europe after the Bank of England hinted that it may soon cut its key interest rate from a 16-year high.
In Asia, indexes were mixed. They climbed 1.2% in Hong Kong and 0.8% in Shanghai after China reported that its exports rose 1.5% in April from a year earlier, while imports jumped 8.4%. The renewed growth suggests a stronger recovery in demand than earlier data had suggested.
Choe writes for the Associated Press
