The index rose on Thursday after strong jobs data and China’s promise of more economic stimulus.
Unemployment claims fell by 4,000 to 218,000, the lowest level in four months, beating expectations for a slow increase.
Traders will be keeping an eye on Friday’s release of consumer spending data.
U.S. stocks rose on Thursday, paring yesterday’s losses, boosted by China’s economic stimulus and strong jobs data.
The index rose after Chinese leaders pledged to support the economy with stronger policy measures.
The sentiment comes days after the country announced a series of economic stimulus measures in an unprecedented move to shore up the country’s slump, which has been plagued by weak domestic demand and a weak real estate sector.
Strong labor market data also fueled the index’s rise. The number of jobless claims unexpectedly fell last week, dropping by 4,000 to 218,000, the lowest level in four months, according to figures released by the Labor Department on Thursday.
These reports mark the second consecutive week of declines and were well below economists’ expectations for a rise to 225,000.
Meanwhile, data released on Thursday showed GDP for the second quarter was unchanged at an annual rate of 3%. The growth rate for the first quarter was revised upward to 1.6% from 1.4%.
The positive indicators are likely to give markets more confidence in the strength of the U.S. economy, as traders expect a series of rapid rate cuts over the next year.
Markets are pricing in a 52% chance that the Federal Reserve will cut rates by another 50 basis points in November, according to the CME FedWatch tool.
Traders on Friday will focus on new consumer spending data, the Fed’s preferred measure of inflation.
Here are the U.S. indexes as of 10:10 a.m. Thursday:
Here’s what else is happening today:
Bénard Arnault increased his net worth by $6 billion in one day after China’s economic stimulus package sparked a rally in luxury goods stocks.
Hedge fund manager Eric Jackson believes stocks are mirroring the early days of the biggest bull market in history and we could be in for an ‘all-out rally’
SocGen announces that the US personal savings rate, a key consumption indicator in the US, has fallen to ‘crisis level’
the story continues
In Commodities, Fixed Income and Cryptocurrencies:
Oil futures fell. WTI crude oil fell 3.29% to $67.32 per barrel. Brent crude oil, the international benchmark, fell 3.13% to $71.13 per barrel.
Gold rose 0.01% to $2,685 an ounce.
The yield on the 10-year U.S. Treasury rose 6 basis points to 3.794%.
Bitcoin rose 0.31% to $57,745.72
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