NEW YORK — Stocks rose on Wall Street Thursday, taking back much of their losses from a day earlier, and are on track to notch weekly gains.
The S&P 500 rose 0.8 per cent. The Dow Jones Industrial Average rose 242 points, or 0.5 per cent, as of 10:01 a.m. Eastern. The Nasdaq composite rose 0.8 per cent. Every major index is on track for weekly gains. U.S. markets will be closed Friday for Juneteenth.
The gains are helping to erase much of the losses from a day earlier that were driven by anticipation that the U.S. Federal Reserve will likely raise interest rates this year in an effort to fight inflation. Bond yields are pulling back. That, along with falling oil prices, is relieving much of the pressure on stocks.
The gains were broad and being led by technology stocks. Intel surged 7.4 per cent after U.S. President Donald Trump announced that the semiconductor giant will make chips for Apple in the U.S. Other big semiconductor companies gained ground. Nvidia rose 1.5 per cent and Micron Technology surged 6.1 per cent.
On the losing end, SpaceX fell for the second straight day since its ballyhooed debut on the U.S. stock market last week. The Elon Musk-led rocket maker and AI company was down 6.5 per cent following a 4.9 per cent loss Wednesday.
Crude oil prices continued to fall after the United States and Iran signed an agreement to end their war and reopen the Strait of Hormuz to oil tanker traffic. Brent crude, the international standard, fell 3.1 per cent to US$77.11 per barrel. U.S. benchmark crude fell 3.7 per cent to $73.15 per barrel.
Prices are still above roughly $70 from before the war, but are well below the $100-plus price from a few weeks ago.
Higher oil prices had been weighing on markets throughout the U.S. war with Iran. The current deal between the nations waives sanctions against Iran and allows it to sell its oil freely. It also opens up the Strait of Hormuz, where a fifth of the world’s oil supply is shipped.
Rising energy costs have also been putting more pressure on already hot inflation. The average price of gasoline in the U.S. has dipped below $4 a gallon, but is still 25 per cent higher from a year ago. Prices have been rising for a wide range of goods because of higher shipping costs.
Hotter inflation prompted the Federal Reserve to shift course from cutting its benchmark interest rate to likely raising rates by the end of the year. The central bank closed its two-day meeting on Wednesday by maintaining its benchmark interest rate at its current level. But it signaled that it will likely raise the rate at least once by December.
That prompted a jump in bond yields on Wednesday, but they eased on Thursday.
The yield on the 10-year Treasury fell to 4.44 per cent from 4.49 per cent late Wednesday. The yield on 2-year Treasury, which more closely tracks action by the Fed, fell to 4.16 per cent from 4.20 per cent late Wednesday.
Markets were mixed in Europe and Asia.
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Senior Producer Mayuko Ono contributed to this report.
By Damian J. Troise
