Traders on the floor of the New York Stock Exchange (NYSE) in New York City experienced a surge in stocks on Thursday, following positive labor market data that boosted investor confidence in the U.S. economy. This came after a sharp market sell-off earlier in the week, causing concern among market participants.
The S&P 500 advanced 2.3% to close at 5,319.31, marking its best day since November 2022. The Dow Jones Industrial Average also saw a significant increase, surging 683.04 points, or 1.76%, to 39,446.49. The Nasdaq Composite added 2.87%, ending the day at 16,660.02. These gains were a welcome relief for investors who had been rattled by the recent market volatility.
One of the standout performers of the day was pharmaceutical giant Eli Lilly, which saw its stock price surge by 9.5% after reporting better-than-expected earnings and raising its full-year outlook. The strong demand for its diabetes treatment Mounjaro and obesity drug Zepbound contributed to the positive results. Additionally, momentum names that had suffered earlier in the week bounced back, with chipmakers Nvidia and Broadcom both jumping by more than 6%. Tech giants Meta Platforms and Apple also saw gains of 4.2% and 1.7%, respectively.
The positive momentum in the market was further fueled by the release of the latest weekly jobless claims data, which came in below forecasts. First-time filings for jobless benefits stood at 233,000, down 17,000 from the previous week and lower than the Dow Jones estimate of 240,000. This news helped allay concerns about the strength of the labor market and provided a much-needed boost to investor sentiment.
Following the jobless claims data, the 10-year Treasury yield hit 4%, a level not seen since before the disappointing July jobs report that had sent markets reeling. Additionally, a weaker Japanese yen against the U.S. dollar also contributed to the positive market performance. The unwinding of a popular carry trade with hedge funds, which had been triggered by a yen surge, was cited as a factor in Monday’s stock drop.
Market experts, such as SoFi’s head of investment strategy Liz Young Thomas, noted that the bounce in the market was a result of positive news and indicated that investors are closely monitoring incoming data for signs of economic strength. While the major averages are still lower for the week, the recovery from Monday’s rout has been significant, with the S&P 500 down only 0.5% and the Dow and Nasdaq lower by around 0.7% each.
Overall, Thursday’s market performance was a welcome reprieve for traders and investors, signaling renewed confidence in the U.S. economy and a willingness to embrace positive news amid ongoing market volatility. The focus now shifts to upcoming economic data releases and their potential impact on market sentiment and performance in the days ahead.
