Benchmarks closed in the green on Thursday as investors focused on improving labor market data that offset inflation worries and snapped a 3-day losing streak.
The Dow Jones Industrial Average (DJI) rose 434.79 points, or 1.3%, to close at 34,021.45 and the S&P 500 gained 49.46 points, or 1.2%, to close at 4,112.50. The Nasdaq Composite Index closed at 13,124.99, adding 93.31 points, or 0.7%. The fear-gauge CBOE Volatility Index (VIX) decreased 16.2%, to close at 23.13. Advancing issues outnumbered declining ones for 1.91-to-1 ratio on the NYSE, while a 1.06-to-1 ratio on the Nasdaq favored advancers.
How Did the Benchmarks Perform?
Dow’s 1.3% jump on Thursday makes its biggest one-day percentage rise in almost two months. More of the blue-chip stocks ended in the green, led by a more than 2.5% rise in shares of The Home Depot, Inc.
HD
The Travelers Companies, Inc.
TRV
and JPMorgan Chase & Co.
JPM
. JPMorgan sports a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Of the 11 major sectors of the S&P 500, only the energy sector closed in the red declining 1.4%. The industrials, financials, utilities and materials sectors closed more than 1.5% higher for the session and the technology sector recovered from the massive sell-off on Wednesday with a 1.4% rise.
The tech-laden Nasdaq also recovered as investors picked up winners from the beaten-down tech space, and bought in the dip. Shares of Peloton Interactive, Inc.
PTON
, Applied Materials, Inc.
AMAT
and Lam Research Corporation
LRCX
closed 6.7%, 4.4% and 4.9% higher on Thursday and were the highest gainer of the index. Big tech companies like Apple Inc.
AAPL
and Microsoft Corporation
MSFT
ended the session with more than 1.5% gain. However, Tesla, Inc.
TSLA
failed to recover from losses and ended 3.1% lower.
Overall, the S&P 500 posted 13 new 52-week highs and no new lows, while the Nasdaq Composite recorded 49 new highs and 201 new lows. A total of 11.50 billion shares were traded on Thursday, higher than the last 20-session average of 10.5 billion.
Weekly Jobless Claims Fall to a Pandemic Low
On Thursday, the U.S. Department of Labor reported that the seasonally adjusted initial claims came in at 473,000 for the week ending May 8. It is a decrease of 34,000 from the previous week’s upwardly revised figure of 507,000 and the consensus estimate was 497,000. The reported figure is not only the fresh pandemic low, but also reflects aggressive hiring being made by companies amid the rapid recovery.
While initial claims declined for the fifth consecutive week, continuing claims came in at 3.655 million for the week ending May 1 and was down from the upwardly revised 3.70 million the week before. Per the reports, applications for initial jobless benefits fell the most in Michigan, New York, Florida and Vermont, whereas there was notable increase in Georgia and Washington.
Wholesale Prices Grows at the Fastest Pace in 13 Years
Yesterday, the U.S. Bureau of Labor Statistics reported that its producer price index (PPI) jumped 0.6% in April, surpassing the consensus estimate of a 0.3% rise. The wholesale price has now risen 6.2% in the past 12 months and is the highest level since the index was reformulated in 2009. Prices of a variety of goods and services have surged this year as the economy recovers and a record spike in oil prices drove most of the increase in wholesale prices. There has been a significant rise in the cost of many raw and partly finished goods, including farm crops, precious metals and computer chips.
In April, wholesale food prices jumped 2.1% and the surge in the price of corn and other farm goods is expected to raise the cost of groceries in the coming months, per the report. Core PPI, which excludes food, energy and trade margins rose 0.7%.
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